TaxTMI 
TaxTMI 
International Financial Services Centres Authority (Investment by International Financial Service Centre Insurance Office) Regulations, 2022
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....nternational Financial Service Centre Insurance Office) Regulations, 2022. (2) They shall come into force from the date of their publication in the Official Gazette. 2. Applicability: (1) An IIO incorporated in an IFSC shall undertake investment of assets in accordance with the provisions of these regulations; (2) An IIO not incorporated in an IFSC may either chose to follow norms related to investment of assets as applicable to its parent entity or as specified under these regulations; (3) An IIO established as a branch of Foreign insurer or Lloyd's India, registered with the Insurance Regulatory Development Authority of India (IRDAI), may either chose to follow norms related to investment of assets as applicable to its parent entity or as specified under these regulations. Explanation: The choices referred to under sub-regulation (2) and (3) shall be exercised by- (a) by an IIO already registered with IFSCA-within one month of notification of these regulations; (b) by an Applicant seeking registration as an IIO, at the time of seeking registration. 3. Objective - These regulations aim to put in place the regu....
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.... consists of a parent company or any other legal person exercising control over rest of the group, including its branches and/or subsidiaries that are subject to AML/CFT policies and procedures. Explanation: Use of common brand names in conjunction with other parameters of significant influence and / or control, whether direct or indirect, shall be reckoned for determination of its inclusion in the group or otherwise. (h) 'infrastructure assets' means any investment made in the infrastructure sub-sectors identified in the 'Harmonised Master List of Infrastructure sub-sectors' as per Gazette Notification no. CG-DLE-11102022-239561 dated October 11, 2022 of the Department of Economic Affairs, Ministry of Finance, Government of India, as revised from time to time, and shall also include the following: a. district heating; and b. financial institutions including the market infrastructure institutions set up in IFSCs. Explanation: (1) The Infrastructure Assets shall not include any maintenance services and facilities for private use. (2) The investments in infrastructure sub-sectors, identified in the Notification referred a....
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....case may be. 5. Investments by IIO - (1) The IIO shall have a Board approved Investment Policy, which shall, inter-alia provide for situations of breaches, action plans to address breaches, provisions for providing Economic Capital, if required. (2) IIOs shall value all of its assets and liabilities, and maintain solvency margin in accordance with the regulations notified by the Authority in this regard. (3) Every IIO, in order to meet its liabilities, shall earmark, invest and at all times keep earmarked and invested, assets of value not less than that of its liabilities and shall also take into account factors such as nature, term or duration, currency and uncertainties of such investments; Provided that an IIO established as place of business of Indian Insurer or Indian Re-insurer, shall not invest its assigned capital including additional assigned capital, if any, in the IFSC, and as such the said assigned capital shall be invested and continued to be invested in accordance with the regulatory requirements applicable on its Parent Entity. (4) An IIO may invest not more than five per cent. of the assets referred to in sub-regulatio....
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....ply with this sub-regulation, it shall submit detailed explanations to the Authority; Provided also that investments in respect of risks assumed (premiums sourced) by the IIO under International Financial Services Centres Authority (Registration of Insurance Business) Regulations, 2021 are ring-fenced and accounted for separately, without being affected by the returns on the investments made in other regulatory jurisdictions. 6. 'Investible Funds' or 'Investment Assets' means investments made out of the following funds: (1) in case of IIO, transacting Life Insurance Business - (a) Shareholders' Funds, to the extent they represent Solvency Margin; (b) Policyholders' Funds in respect of: (i) Participating and Non-Participating Funds of Policyholders, (ii) Funds of Variable Insurance Products including One Year Renewable Pure Group Term Assurance Business (OYRGTA) at their carrying value, (iii) Non-Unit Reserves of Unit Linked Insurance business, and (iv) Pension, Annuity and Group Superannuation business including funds of Variable Insurance products at their carrying value as per guidelines issued under these....
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....Pattern Matrix Sr. No. Type of Investment Asset Exposure (per cent.) Maximum Buffer 1 Listed/ to be listed Bonds, Debentures and equivalent fixed income instruments including Asset Backed Securities (ABS), Mortgage Backed Securities (MBS); and Debt Mutual Funds subject to Note 3. 80 20 2 Debts (other than specified in (1) above), Corporate and Bank Deposits and similar rights 30 10 3 Listed/ to be listed Equities and equity type instruments including Preference Shares; and Equity Mutual Funds 20 5 4 Alternative Investment Funds (AIF) - Category 1 and 2 5 5 5 Loans (other than policy loans in Life Insurance) 5 0 6 Immovable Property including Real Estate Investment Trusts (REITs) 5 0 7 Infrastructure including Infrastructure Investment Trusts (InvIT) and instruments for financing Infrastructure Assets 5 0 8 Money markets for short period, including in Liquid and Money Market Mutual Funds (for new funds pending deployment and payments on maturing policies) 100 0 9 Money markets for short period including in Liquid and Money Market Mutual Funds (for other than new funds....
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.... Buffer (per cent.) 1. Bonds and other fixed income instruments including Debt Mutual Funds 2. Debts, Loans, Corporate and Bank Deposits and similar rights SCR-RC 1 100 0 SCR-RC 2 and 3 50 10 SCR-RC 4, 5 and 6 20 0 SCR-RC - 7 and lower within Investible Grade 10 0 India including IFSC 100 0 12. Equity Exposures by Sovereign Credit Ratings: The exposures of an IIO to Equities and similar instruments listed below shall be limited as per the following matrix, based on the top Investment Grade ratings given by internationally reputed rating agencies to the countries where such instruments are offered and investments made:- Matrix 4: Equity Exposure Matrix by Sovereign Credit Rating Type of Investment Asset Sovereign Credit Rating - Rating Category (SCR-RC) SCR-RC Maximum (per cent.) Buffer (per cent.) 1. Listed Equities and equity type instruments including Equity Mutual Funds 2. Preference Shares 3. Alternative Investment Funds (AIF) Category 1 and 2 only 4. Derivatives SCR-RC 1 100 0 SCR-RC 2 & 3 50 10 SCR-RC 4, 5 & 6 20 5 SCR-RC - 7 and lower, within Investible Grade ....
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....pital and free reserves (excluding revaluation reserve) and debentures, bonds (incl. C.P) of the Investee. 15. Governance: (1) The Board of an IIO shall have its own prudential mechanisms to evaluate, monitor, measure, report, control and limit their investment exposure. (2) An IIO shall conduct independent due diligence on proposed investments in addition to the rating given by Rating Agencies. (3) An IIO shall infuse such additional capital, as may be specified by the Authority in case: (a) Exposure of investment exceeds the limit specified under regulation 9 to 14; or (b) Rating downgrade of the Asset in which investment has been made, to below investment grade. (4) An IIO shall continuously monitor the exposures of its investments to Market Risk, Interest Rate Risk, Currency Risk, Credit Risk, Other Market Risk, Liquidity Risk, Climate Change Risk etc. and take appropriate prudential measures to manage the same. 16. Management and Control (1) The entire investment process of an IIO shall be overseen by an Investment Management Committee comprising of persons with financial and actuarial background duly authori....