in

Irdai removes curbs on dividend payout as insurers deliver better results

Dividend payout by BSE500 firms up 1.7%; share buyback rises 64% in FY19

“The authority has been assessing the economic position both at global level and at the Indian context, in general and the insurance sector in particular”, it said.

The insurance regulator has withdrawn an April 2020 circular, which asked to refrain from paying dividends from FY20 profits. The can now declare dividend for the current financial year.

“Dividend can be declared from the recent profit or the current year’s profit. That is their (insurers) call,” said an official.

"There is good growth in both general and life But, all are not alike. Some companies might have recovered but some might be still struggling,” he added.

The move comes as the business performance of has been reviving gradually, said after assessing the financial results for Q2FY21 and Q3FY21.

It, however, asked to take a conscious call while declaring dividends for FY21, keeping in mind their capital position, solvency margin, and liquidity position.

“Considering the revival phase of the economy in general and the in particular, and taking into account the solv­ency position of the insurers, it has been decided to withdraw the applicability of the circular with immediate effect,” the regulator said.

“The authority has been assessing the economic position both at global level and Indian, in general and the insurance sector in particular. It is observed that the performance of the insurers in terms of business is gradually reviving, albeit at a slower pace vis-a-vis the pre-Covid levels,” it added.



Reference