Refrain from paying dividend for FY20, IRDAI tells insurers

Listed and unlisted insurers - life, non-life and reinsurers - have been asked by the sectoral regulator to refrain from making dividend pay-outs from profits pertaining to FY 20.

In a circular to all the insurers, the Insurance Regulatory and Development Authority of India (IRDAI) on Friday said: "In view of the emerging market conditions, and to conserve capital with the insurance companies in the interests of the policyholders and of the economy at large, insurers are urged to take a conscious call to refrain from dividend pay-outs pertaining from profits pertaining to the financial year ending 31st March 2020, till further instructions."

The IRDAI said the position will be reassessed by it based on the financial results of insurers for the quarter ending September 30, 2020.

According to it, the necessary relaxations on recognition of approved investments under its investment regulations arising out of the above will be separately considered. With this circular, the IRDAI has not only barred private insurers but also the Life Insurance Corporation of India paying out dividend to its owner, the Central government.

Source: SME Times