Insurers to gain access to G-Sec, repo transactions

Key facts

• Insurers will soon be able to undertake repo and government securities lending transactions.
• The insurance regulator is developing an operational framework for these activities.
• Recent amendments to insurance laws enable these changes.
• The new framework will cover settlement, platforms, collateral, and risk management.

Insurers hold a substantial amount of government securities. Allowing them to participate in repo and securities lending transactions will offer them more options for managing their liquidity and potentially enhance returns on their holdings.