The Hindu Business Line : IRDA asks for status reports from Tata AIG ventures

Mumbai, Sept. 16 The Insurance Regulatory and Development Authority has asked the two Indian insurance joint ventures between the Tata Group and American International Group (AIG) of the US to submit reports on their operational status. This comes in the wake of Monday’s news of AIG facing a severe liquidity crunch, prompting it to request for short-term financing from the Federal Reserve of the US.

AIG holds 26 per cent stake in two joint ventures with the Tatas — Tata AIG Life Insurance and Tata AIG General Insurance. Tata Sons holds 74 per cent equity in both these companies.

Sources said the management of both these entities have written to AIG seeking certain clarifications regarding the US insurer’s financial status. The two companies have not responded to IRDA yet.

Even though IRDA claimed that the two companies had satisfactory solvency margins to meet their liabilities, it has asked for the reports in the light of the developments reported in the US.

“The recent developments in the New York financial markets have caused concern in the financial markets in India. Certain newspapers have reported that AIG, which is a leading insurance group of US, has sought financial support from the Fed Reserve,” IRDA said in a statement on its Web site.

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