Life Insurance Corporation of India, General Insurance Corporation of India, and New India Assurance Co. are still considered as Domestic Systemically Important Insurers (D-SIIs), according to the Insurance Regulatory and Development Authority of India (IRDAI), which also stated that they are "too big or too important to fail."
Due to their size, market importance, and linkages both domestically and internationally, insurance businesses are referred to as Domestic Systemically Important Insurers (D-SIIs), which are essential to the domestic financial system. The stability of the domestic financial system could be severely impacted by the failure or financial instability of these insurers.
The continuous provision of insurance services to the national economy depends on the proper operation of D-SIIs. The Insurance Regulatory and Development Authority of India (Irdai) announced the list of Domestic Systemically Important Insurers (D-SIIs) for the year 2022–23 and stated that LIC, GIC Re., and New India "continue to be identified as Domestic Systemically Important Insurers (D-SIIs), as in the 2021–22 list of D-SIIs."
D-SIIs are viewed as insurers that are "too big or too essential to fail," according to the statement.
According to Irdai, this view and projected expectation of government support may boost risk-taking, decrease market discipline, cause competitive distortions, and raise the likelihood of future crisis.
The regulator stated that D-SIIs are being exposed to increased regulatory oversight and added, "These concerns require that D-SIIs be subjected to extra regulatory measures to cope with systemic risks and moral hazard issues."
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