The Insurance Regulatory & Development Authority (IRDAI) has advised insurance companies to create a buffer against their exposure to the beleaguered Infrastructure Leasing & Financial Services (IL&FS) Group, an official said here on Thursday.

While the public-owned (LIC) is the biggest stakeholder with a 25.34 percent stake in IL&FS, the private player IDBI Federal Life Insurance has an exposure of around Rs 20-crore plus.

Aditya Birla Sun Life has no exposure but the real extent of exposure of the other insurance companies in the IL&FS is not clear so far.

The IRDAI and Khuntia had earlier warned insurance companies on probable risks associated in investments in low-rated debt instruments.

Later, some of the group companies of IL&FS defaulted on debt repayments causing a liquidity freeze in the NBFC sector in September 2018.

Presently, the IL&FS is in the red with a debt of over Rs 90,000 crore and the Ministry of Corporate Affairs dragged the company to the National Company Law Tribunal where it (IL&FS) submitted a revival plan.

--IANS

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