INDIA “IN NO HURRY” TO IMPLEMENT SOLVENCY II

India’s Insurance Regulatory & Development Authority (IRDA) is “in no hurry” to implement Solvency II guidelines, according to IRDA chairman CS Rao. India’s current solvency regulations require insurers to maintain a 150% margin over insured liabilities, a level which some of the public sector players had difficulty meeting — in turn leading to reports earlier this year that a partial privatisation was being considered in order to raise funds for the insurers. Reports suggested that these insurers would find it equally difficult to abide with the IAIS’s new Solvency II system. One potential problem is the valuation of government-issued securities. Business Online reported that these were still valued on a book basis by the public sector insurers, while Solvency II would require them to be valued at mark-to-market or fair value. Most of the private sector in insurance is reportedly ready to migrate to Solvency II.