Investors can continue to invest in current ULIPs and no new ULIPs are allowed, clarifies SEBI
Market regulator Securities and Exchange Board of India (SEBI) said today that it was working together with insurance watchdog IRDA (Insurance Regulatory and Development Authority) to expeditiously find a “legally binding” resolution to who controls unit-linked insurance plans (ULIPs) and there are no restrictions on investment in existing schemes.
“We want to do it (move the appropriate court) quickly,” SEBI chairman CB Bhave said on the sidelines of a CII conference on Indian financial markets.
He also told foreign institutional investors, who are apprehensive over the turf war between the two regulators, that they can “continue to invest in current ULIPs”, which have a portfolio of over Rs92,000 crore.
SEBI’s latest direction is against floating any new product, he clarified.
“FIIs should know what the correct position is and the correct position is that investors can continue to invest in current ULIPs and no new ULIPs are allowed,” Mr Bhave said.
SEBI had last week said that all ULIPs issued after 9th April will have to have its approval. This was questioned by insurance sector regulator IRDA.
Yesterday, the market watchdog had moved the Supreme Court and some High Courts to guard against any ex-parte decision.
On 10th April, SEBI had banned 14 life insurance companies from raising funds through ULIPs without its approval.
Later on 14th April, SEBI came out with a second order that exempted the existing ULIP schemes of these 14 players from the ban.