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| M&A guidelines for insurance sector by March end |
| Press Trust of India / New Delhi Feb 19, 2009, 19:46 IST |
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The Insurance Regulatory and Development Authority (IRDA) is all set to come out with merger and acquisition (M&A) norms by the end of next month that would facilitate consolidations in the sector.
"The guidelines for merger and acquisition (for the insurance sector) would be ready by March end," IRDA Member Actuary R Kannan said on the seminar organised by Assocham here.
The regulator is looking at the various aspects of M&A with regard to protection of interest of shareholders as well as policyholders.
Among other things the sector regulator is looking at is the liability as on the day of closing, besides evaluation of assets and protection of assets.
Kannan said, "One of the important aspects is management of cashflow and make a projection so that till the last policy holder exits money is available."
However, he said, the regulator would not dictate the price rather it would be its endeavour to make the whole process transparent so that all the policyholders and shareholders take an informed decision.
So the norms would have a portion of asset and liability valuation, corporate governance and transparency, he added.
At present, there are no specific guidelines for M&A in insurance sector in the country.
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