20 October 2000

LIC misses IRDA deadline on equity increase
Mumbai: In what is the first instance of defying the diktats of the insurance regulatory body, Life Insurance Corporation missed the deadline to raise its equity capital to Rs 100 crore from the present level of Rs 5 crore. By doing so, it became the first insurance company to default on the Insurance Regulatory and Development Authority guidelines.

IRDA had given a period of six months to LIC and the four General Insurance Corporation subsidiaries to raise their paid-up capital to Rs 100 crore.

While LIC executives and officials in the finance ministry, however, said that the life insurance company is not required to raise its equity capital, top IRDA officials maintained that LIC had to increase its equity to Rs 100 crore by yesterday.

LIC executives maintain that the equity norms are applicable only to the new life insurance companies only. The government has raised the equity in the four GIC subsidiaries because they are being delinked from the parent company.

19 October 2000