IRDAI Proposes Gold ETF Investment, Higher Limits For REITs And InvITs

Indian Insurance Regulation and Development Authority (IRDAI) proposed changes under the main circular on the actuarial, financial and investment functions of insurance companies.

Existing norms do not allow insurance companies to invest in commodities. The proposed changes will allow insurance companies to deposit their unit -related insurance plan (ULIP) money to the Golden Stock Exchange Fund (ETF) to 5 percent of the Fund assets on the 15 percent general investment fund limit.

On the same lines, the proposed norms double the investment limit in REIT/INVits and GYO bonds, 6 percent of the relevant fund size of the Life Insurance company and 6 percent of the investment assets of general insurance companies.

Aneesh Srivastava, Star Health and Chief Investment Officer, General Manager of Allied Insurance, “These are attractive and safe assets that earn approximately 6-7 percent,
Capital appreciation. If these limits are finalized, they help better pricing for insurance companies. “

The regulator in the draft circular proposed to reduce the minimum public holding process during the investment in Invit/GYO to 25 percent from the current 30 percent of the total unpaid total.
Invit/REIT units.

The proposed norms will be valid for life, general and health insurers. If norms pass, they will allow insurance companies to obtain higher return in their investments, make product pricing competitive and offer long -term funds for infrastructure investments.