IRDA and SEBI, fresh out of a turf war, join hands so that life insurance companies will soon be able to launch initial public offer

According to the media speculations, IRDA has already submitted its set of guidelines to SEBI. The guidelines include recommendations like doing away with three year profitability clause and exemption from the norm of having 25 per cent equity with the public.

Though, there is a question mark. As per the recommended guidelines by IRDA, companies should complete at least ten years of business before they decide to list.

If this rule is to be applied, only three insurers ICICI Prudential, SBI life Insurance and HDFC Standard Life Insurance will become eligible by the end of this year.

Insurers like Reliance Life Insurance will not be eligible as they have completed just seven years in business.

That’s why; those three are striving to be ready as soon as they can. They are already putting enough efforts, internally and ultimately, to be ready when the promoters want to do a listing.

Though, the final guidelines are still months away. IRDA will look at what companies are eligible for IPO, whereas SEBI is only concerned with the disclosure requirement.

Now the biggest question, keeping the present market scenario in mind, would the insurance companies oblige the listing if they find that the final regulations isn’t favorable?