Irdai relaxes norms for surety bonds to expand market for such products

The Insurance Regulatory and Development Authority of India (Irdai) has relaxed norms for 'surety bonds' to increase availability and expand the surety insurance market. The solvency requirement applicable for such products has been reduced to 1.5 times from 1.875 times and the 30% exposure limit on each contract underwritten by insurers has been removed. The amendments follow the recent notification removing the cap on premiums that could be underwritten in a financial year by mono-line insurers transacting only surety insurance business. The changes aim to increase liquidity for contractors, foster a healthy business environment and boost the infrastructure sector.

Irdai relaxes norms for surety bonds to expand market for such products
The Insurance Regulatory and Development Authority of India (Irdai) has relaxed norms for 'surety bonds' to increase availability and expand the surety insurance market. The solvency requirement applicable for such products has been reduced to 1.5 times from 1.875 times and the 30% exposure limit on each contract underwritten by insurers has been removed. The amendments follow the recent notification removing the cap on premiums that could be underwritten in a financial year by mono-line insurers transacting only surety insurance business. The changes aim to increase liquidity for contractors, foster a healthy business environment and boost the infrastructure sector.