Important Points for IC 99 - Asset Management Exam
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For life insurers, investment in Central Govt, Securities, State Govt. Securities & or other approved securities such as municipalities should not be for less than 50% of total investment assets as per Regulation 4 in the IRDA Investment Regulations 2013.
D.G. Gardener defined the derivatives as "A derivative is a financial product which has been derived from market for another product."
The securities Contracts (Regulation) Act 1956 defines "derivative" in the following manner under section 2 (ac).
"Derivative" includes : "a security derived from a debt instrument, share, loan whether secured or unsecured, risk instrument or contract for differences or any other form of security" - "a contract which derived its value from the price, or index of prices at underlying securities."
Accounting Standard SFAS133 defines a derivative instrument as a financial derivative or other contract which will comprise of all three of the following characteristics : i) it has one or more underlying asset, and one or more notional amount or payments provisions or both. Those terms determine the amount of the settlement or settlements.
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