New Delhi: The capital markets and insurance regulators have agreed to maintain current status on unit-linked insurance products (Ulips), television channel CNBC TV18 showed Union finance minister Pranab Mukherjee as saying on Monday.
The Securities and Exchange Board of India (Sebi) and the Insurance Regulatory Development Authority (Irda) have also agreed to abide by legal verdict, Mukherjee told reporters after meeting the heads of the regulatory bodies.
“To resolve any ambiguity and to ensure smooth functioning in the market, the regulators have agreed to jointly seek a binding legal mandate from an appropriate court,” Mukherjee said.
“Meanwhile, status quo ante is being restored,” he told reporters outside the finance ministry.
Ulip is an insurance product in which a bulk of the premiums is invested in equities and bonds.
Mukherjee’s comments came after a series of meeting between finance ministry officials and Irda chairman J Hari Narayan Sebi chief C B Bhave.
Late last Friday, the Sebi said it barred 14 life insurance companies from issuing Ulips without the capital markets regulator’s approval with immediate effect.
In response, insurance regulator Irda on Saturday assured policyholders their investments are safe and issues arising out of Sebi orders will be addressed in the ”appropriate forum”.
The ball had since gone into the finance ministry’s court.
Bhave and Hari Narayan held separate meetings with finance secretary Ashok Chawla on the ongoing tussle between the two regulators.
The life insurance companies against whom Sebi passed the order are SBI Life, ICICI Prudential, Tata AIG, Aegon Religare Life, Aviva Life, Bajaj Allianz, Bharti AXA, Birla Sunlife, HDFC Standard Life, ING Vysya Life, Kotak Mahindra Old Mutual Life, Max New York Life, Metlife India and Reliance Life.