CAM GIFT City IFSC Updates

International Financial Services Centres Authority (Investment by International Financial Services Centre Insurance Office) (Amendment) Regulations, 2024

On October 14, 2024 , IFSCA notified the International Financial Services Centres Authority (Investment by International Financial Services Centre Insurance Office) (Amendment) Regulations, 2024 (“Investment Amendment”) to amend the IFSCA (Investment by International Financial Services Centre Insurance Office) Regulations, 2022 (“Investment by IIO Regulations”).

Key Amendments:

• Insertion of Regulation 9A which provides that every International Financial Services Centre Insurance Office (“IIO”) shall invest and at all times keep invested its funds of unit linked business as per pattern of investment subscribed by the policy-holders, where the units are linked to categories of assets which are both marketable and readily realizable.
• Maximum Investment Asset Exposure by an insurer as a percentage of the total unit linked business assets is provided as follows:

1. 10% for single entity (Investee),
2. 5% for within the IIOs own group,
3. 15% for any other single group;
4. 15% for particular industrial sector.

However, there are certain relaxations for investments in passively managed/index-based mutual funds and exchange traded funds, where the exposure limits (except for 5% within IIOs own group) are applicable after three years from the launch of fund or Asset under Management of fund becomes equal to or more than USD 25 million.

• The maximum Exposure limits for investments by an IIO in Domestic Tariff Area (“DTA”) is as per categories specified in Regulation 5(2) of the IRDAI (Re-insurance) Regulations, 2018 is as follows:
• 10% for securities of Central Government of India;
• 15% for corporate bonds;
• 10% for SEBI approved Alternative Investment Funds- Category I and II;
• 5% for immovable property immovable property including Real Estate Investment Trust (“REITs”);
• 5% for infrastructure including Infrastructure Investment Trust (“InvITs”) and instruments for financing Infrastructure assets;
• 90% for money markets instruments for short period;
• 25% for investments in equity, preference shares, and convertible debentures;
• 90% for investment in debt including commercial papers.

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The notification is available here

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