Life insurers to abide by IRDA's directions, says Council

New Delhi, Apr 11 (PTI) India's Life insurance industry
association Life Insurance Council on Sunday said insurers
will abide by Insurance Regulatory and Development Authority's
direction and would continue business as usual.
"The 14 life insurers would abide by the IRDA's direction
to continue business as usual," Life Insurance Council
Secretary General S B Mathur told PTI when asked if the
insurance companies would continue to sell ULIP policies
following the regulator IRDA's directions.
Market regulator Securities and Exchange Board of India
(SEBI) on Friday last week banned 14 life insurance companies
from raising funds through unit-linked insurance policies,
which invest the money collected into equity and debt markets.
Insurance sector regulators IRDA, however, yesterday
rejected the SEBI ban and asked the insurance companies to do
business as usual.
Unit-linked equity products (ULIPs) are insurance plans
sold by life insurers where the money collected from consumers
is invested into equity and debt markets and returns are
linked to the same. Regulation of ULIPs has become a bone of
contention between the two regulators.
The turf war concerns the nature of ULIPs which account
for over 50 per cent of the total life insurance business in
the country.
As on March 31, 2009, total funds under the management
of life insurance sector stood at over Rs 9 lakh crore of
assets, according to the Life Insurance Council's figure.
The life insurance companies against whom SEBI passed
the order are SBI Life, ICICI Prudential, Tata AIG, Aegon
Religare Life, Aviva Life, Bajaj Allianz, Bharti AXA, Birla
Sunlife, HDFC Standard Life, ING Vysya Life, Kotak Mahindra
Old Mutual Life, Max New York Life, Metlife India and Reliance
Life. PTI BSP
MYR