Insurance companies have to make provisions for IL&FS defaults: Regulator

Insurers have to declare their exposure to IL&FS as non-performing assets (NPAs) if the beleaguered business group has defaulted on payments, said the insurance regulator Friday.

Insurance companies will have to take a hit in their shareholders’ profit—similar to what the Reserve Bank of India asked last week banks to do about their IL&FS exposure.

“Now, it has to be treated as NPA like what RBI has suggested. The insurance companies will automatically do it. There is method of treating the NPA, same method which is used by banks under RBI guidelines, similar treatment has to be done here,” said