Market regulator Securities and Exchange Board of India (SEBI) barred the launch of new unit-linked insurance plans (ULIPs) by 14 life Insurance companies until they seek permission from the Insurance Regulatory and development authority (IRDA).
However, the order will not apply to existing ULIPs, SEBI said.
On April 10, SEBI had banned the 14 insurance companies from selling their Unit-linked Insurance products as these were in the nature of mutual funds and not insurance.
SEBI and IRDA agreed to maintain the current status of ULIPs after the intervention of the finance ministry.
Both the regulators have agreed to jointly seek a legal binding mandate from an appropriate court.
Earlier, the IRDA rejected SEBI’s decision and asked the companies to carry on with business as usual.
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