Title: Exposure Draft
Reference No.: --
Draft Guidelines for Listed Indian Insurance Companies
The Authority, in exercise of the powers conferred by Section 14 of Insurance Regulatory and Development Authority of India Act, 1999, read with clause (b) of sub-section (4) of Section 6A of the Insurance Act, 1938, proposed to issue Guidelines for Listed Indian Insurance Companies.
A summary of these guidelines is as under
1. These Guidelines shall be applicable to all insurers who have listed their equity shares or are in the process of getting their shares listed on the stock exchanges in relation to transfer or proposed transfer of shares.
2. These guidelines shall be in addition to IRDAI (Issuance of Capital by Indian Insurance Companies transacting Life Insurance Business) Regulations, 2015 and IRDAI (Issuance of Capital by Indian Insurance Companies transacting other than Life Insurance Business) Regulations, 2015
3. Provisions relating to Transfer of the Shares
a. Every person who intends to make any transfer/ make any arrangement or agreement for transferring 1 percent or more but less than 5 percent of the paid up equity share capital of the concerned insurer, may do so, subject to the compliance of Fit and Proper criteria.
b. Every person who intends to make an acquisition / make an arrangement or agreement for acquisition which will / is likely to take the aggregate holding of such person together with shares held by him, his relatives, associate enterprises and persons acting in concert with him, to 5 per cent or more of the paid-up equity share capital of the concerned insurer shall seek prior approval of the Authority in the manner specified in these guidelines.
4. Provisions Relating to Shareholding
a. Every insurance company which intends to go for listing shall convert its equity share holding in Demat format.
b. The minimum shareholding by promoters / promoter group shall at all times be maintained at 50 percent of the paid up equity capital of the insurer. However, where the present holding of the promoters is below 50 percent, such holding shall be the minimum holding.
c. Ownership limits for all shareholders, other than promoters/ promoter group, in a definitive time frame as may be specified by the Authority, shall be based on categorization of the shareholders under two broad categories viz. (i) natural persons (individuals) and (ii) legal persons (entities/institutions).
d. A subsidiary company may invest in a listed insurance company, provided it complies with all the provisions as may be applicable for such an investment under applicable laws.
5. The Guidelines shall also be applicable to an insurance intermediary licensed by the Authority provided that such insurance intermediaries is drawing more than 50 percent of its revenue from insurance business.
The draft guidelines are attached herewith (Click the links to download the Guidelines and Form). The comments/suggestions should reach by 22nd June, 2016 to the undersigned by e-mail at rksharma at irda dot gov dot in with a copy to Dr. Mamta Suri, HOD-F&A at mamta at irda dot gov dot in
R K Sharma