Shares of most insurance companies were trading higher on Tuesday as sentiment improved after the Insurance Regulatory and Development Authority of India scaled back its suggestion to increase the surrender value payment to policyholders.
The new regulation will come into effect from April 1. Surrender value is what a life insurance company pays to policyholders on termination of the policy before the tenure.
The regulator suggested an increase in the surrender value payment to policyholders in its December draft. This was flagged by life insurance companies as it would have an impact on earnings.
Max Financial Services Ltd. rose the most, trading 3.72% higher as of 10:41 a.m.
ICICI Prudential Financial Services Ltd., Bajaj Finance Corp., and Poonawall Fincorp Ltd. were all trading higher following the news.
However, bucking the trend were shares of Dhani Services Ltd. and ICICI Lombard General Insurance Co., among others.
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