InvestorQ : I recently read something with respect to Insurance Regulatory and Development Authority of India (IRDAI) and Infrastructure Leasing and Financial Services (IL&FS). But how is the insurance regulator connected with IL&FS or its scam?
Shobit Khurana made post

I recently read something with respect to Insurance Regulatory and Development Authority of India (IRDAI) and Infrastructure Leasing and Financial Services (IL&FS). But how is the insurance regulator connected with IL&FS or its scam?

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Nitin Shah answered.
3 years ago
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Yes, Insurance Regulatory and Development Authority of India (IRDAI) is monitoring the IL&FS crisis. Although there was no seemingly obvious connection between the insurance regulator and the defaulting company, there is one of percentage of stake held.

According to insurance regulatory rules, as set by the IRDAI, an insurance company cannot have more than 15 percent stake in a single entity. However, a company can seek IRDAI exemption for specific transactions.

Thus, it is being said that LIC flouted norms by increasing its stake in LIC beyond the stipulated 15 percent without seeing any permission or approval from IRDAI.

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