The Insurance Regulatory and Development Authority of India (IRDAI) has authorized insurers to utilize equity derivatives. This move equips them with enhanced tools to navigate market turbulence and safeguard the returns of policyholders.
Previously, IRDAI regulations permitted insurers to engage with rupee interest rate derivatives like forward rate agreements (FRAs), interest rate swaps, and exchange-traded interest rate futures (IRFs). Beyond fixed-income derivatives, insurers were also allowed to participate in credit default swaps (CDS) to offer protection to buyers.
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