The Insurance Regulatory and Development Authority of India ( Irdai) in its draft guidelines (feedback is invited till June 22) for listed insurance companies has proposed that the minimum shareholding by promoters or promoter group be maintained at 50 per cent of the paid- up equity capital of the insurer at all times. Where the present holding is below 50 per cent, that shall be the minimum.
These are proposed to apply for all insurers which have listed their equity shares or are in the process of doing so. These guidelines, said Irdai, would be in addition to and not in derogation of any other law in force.
The regulator proposes that ownership limits for all shareholders, other than promoters or promoter group, be based on categorisation under two broad categories, natural persons ( individuals) and legal persons ( entities/ institutions).
A subsidiary company may invest in a listed insurance company if it complies with all the provisions applicable for such an investment under applicable laws. These guidelines to also apply to an insurance intermediary licensed by Irdai, provided the latter draw more than 50 per cent of revenue from the insurance business.
On transfer of shares, every person who intends to make any transfer of one per cent or more but less than five per cent of the paid- up equity share capital of the insurer concerned can do so, subject to criteria compliance.
Business Standrad New Delhi,16th June 2016
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