'No time limit for LIC to cut stake in companies'

The Irda on Thursday said no timeframe had been set for Life Insurance Corp of India to reduce its holding in companies in which it has more than 10 per cent stake.

"There is no specific time for that (LIC to cut stake in companies)," chairman J Hari Narayan said on the sidelines of a health insuranc summit. "They (LIC) will do it (reduce stake)...at an appropriate time."

Insurance companies are not allowed to hold more than 10 per cent stake or 10 per cent net worth of a company. LIC has more than this mandated stake in at least 10 companies.

On initial public offerings of insurance companies, Narayan said so far, no insurer had sought Irda's approval. In December, the regulator issued IPO norms for life insurance companies, as the sector is demanding capital infusion for further growth. "So far, nobody (has) approached us," Narayan said.

On the rise in complaints against insurers, he said it was because investors did not understand the language used in policy documents. Irda has asked insurers to simplify the language used in the policy documents to make it easier to understand.

Narayan said 37 per cent of the complaints on general insurance were related to wealth insurance.

Irda will soon release guidelines on the terminology to be used in policy documents, particularly in health insurance, he said.