The Economic Survey 2010-11 today said there will be different set of norms for life and non-life insurance companies for coming out with a public float. It is proposed that the disclosure requirements for life and non-life companies would be separately mandated given the nature of their respective business, the Economic Survey tabled in the Parliament said.
The Survey said that investors would be required to be made aware of the financial performance, company profile, financial position, risk exposure, corporate governance and management of these companies.
“The IRDA is participating in the meetings of the Standing Committee on Disclosures and Accounting Issues (SCODA) set up by the SEBI to finalise the disclosure requirements for insurance companies in their prospectus documents,” the Survey added.
“Several insurance companies will be completing 10 years of their operations shortly, after which they may be allowed by the regulator to go in for an IPO,” the Survey said.
In October last year, capital market regulator SEBI had given approval to insurance companies for coming out with a public float.
Several private sector insurers, including Reliance Life and HDFC Standard Life, have shown interest in tapping the capital market to augment their resource base.
Among the life insurers, HDFC Standard Life and SBI Life have completed 10 years of operations.
As per the disclosure norms in offer document of life companies approved by the SEBI, the insurers would have to come up with disclosure of risk factors specific to the companies.
Also, the offer document would have a glossary of terms used in the insurance sector.
Besides, the state-owned Life Insurance Corporation, 22 private companies are offering life insurance policies.
In the general insurance industry there are 24 players, of which four are from the public sector.