Pvt insurers shy away from State-guaranteed bonds.

(From Business Line)

Insurers' reluctance to invest in such securities stems from fears of depreciation in market value.

Bangalore, Oct. 1 - PRIVATE sector life and non-life insurance companies are staying away from State Government guaranteed securities fearing liquidity risks.

Industry sources said they preferred parking their investible funds in either Government securities, public sector bonds or top rated corporate bonds. This is despite the low yields in these securities in view of the lower risk profile.

In fact, for most of the private sector insurers, both life and non-life, the average yield on investments is less than 7 per cent. …