Reliance Health Insurance’s solvency margin reduced to 63%, according to IRDA to be 150%
IRDA said- Reliance Health should transfer its portfolio to Reliance General Insurance by November 15
Insurance regulator IRDA has directed Anil Ambani’s company Reliance Health Insurance (RHICL) not to sell the new policy. IRDA also asked Reliance Health Insurance in a letter issued on Wednesday to hand over its responsibility to Reliance General Insurance by 15 November. IRDA took this decision because of the continuing decline in RHICL’s solvency margin. By the end of September, this margin was 63%, according to the rules should not be less than 150%. The solvency margin of an insurance company shows whether it has enough money to settle claims in adverse circumstances.
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Pls EARN & SPEND for freebies, don’t BORROW.
Wake up @ysjagan
— Sunil Deodhar (@Sunil_Deodhar) November 3, 2019
Gave Reliance Health a chance, but the situation has not improved: IRDA
According to IRDA, Reliance Health Insurance could not meet the solvency margin requirement since June. The company was given a chance twice before the decision to stop selling the policy, but the situation did not improve.
Reliance Health Insurance started a business in October 2018. Reliance Capital is its promoter company. It formed Reliance on Health Insurance, separating Reliance General Insurance’s health insurance business.
Reliance Health Insurance cannot use its assets for any payment other than a settlement of claims till 15 November. IRDA estimates that Reliance Health’s assets settle the potential claims of existing customers in the future.
IRDA has said that the process of transfer of Reliance Health Insurance’s portfolio to Reliance General Insurance and settlement of claims will be monitored, safeguarding the interests of the insured.