Our Bureau New Delhi, Dec. 3 The Insurance Regulatory and Development Authority (IRDA) is pitching for consolidation in the Indian insurance industry. The IRDA Chairman, Mr J. Hari Narayan, said today that the regulatory authority was working on guidelines for mergers and acquisitions (M&As) in the insurance sector. "There is a need to evolve M&A guidelines. Given what is happening across markets, it may be an opportune time for insurance industry to consider M&As. But in India we do not have within the insurance regulatory roadmap (framework) appropriate guidelines in this regard. I think we need to evolve some of them and we are working on them", he told a FICCI conference on insurance here. A consolidation in the industry is expected to help improve competitiveness of the players besides providing increased benefits to customers. Since the opening up of the insurance sector, the number of participants in the industry has gone up from six insurers (including Life Insurance Corporation of India, four public sector general insurers and General Insurance Corporation, as the national re-insurer) in 2000 to 42 insurers operating in the life, non-life and re-insurance segments as of today. During 2008-09, registration had been granted to three companies in the life segment. At the conference, Mr Hari Narayan noted that insurance companies would be getting into an asset-liability mismatch of "varying degrees of intensity as we go along". He highlighted that the lack of availability of long-term securities in the market might impact certain kinds of liabilities that would arise in the future. "This is one issue that we would be taking up with the Finance Finistry at an appropriate time", Mr Hari Narayan said. The IRDA Chairman asked the insurance companies to use the opportunity of this downturn to get their house in order (improve treasury management performance etc) and build foundation for future growth, which he said would help double penetration of insurance in the country. He also raised the issue of variation in management expenses ratio among the life insurance companies that have been in operations for at least five years. On the issue of changes in solvency regime, Mr Hari Narayan felt that it was perhaps "premature" or may even be "imprudent" at this point of time to expect wide-ranging or significant changes in the solvency regime in the Indian insurance sector. Mr Hari Narayan also said that IRDA was looking at rationalising the insurance intermediary sector. http://www.thehindubusinessline.com/2008/12/04/stories/2008120452420100.htm Who is wise? He that learns from everyone. Who is powerful? He that governs his passions. Who is rich? He who is content. Who is that? Nobody - Benjamin Franklin --~--~---------~--~----~------------~-------~--~----~ You received this message because you are subscribed to the Google Groups "Kences1" group. To post to this group, send email to [email protected] To unsubscribe from this group, send email to [EMAIL PROTECTED] For more options, visit this group at http://groups.google.com/group/kences1?hl=en -~----------~----~----~----~------~----~------~--~---
