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AMCs barred from offering Insurance products bundled with MFs

Published on June 22, 2022
Current Context: The Securities and Exchange Board of India (Sebi) has barred asset management companies (AMCs) in India from offering insurance products bundled with their mutual fund schemes.
AMCs barred from offering Insurance products bundled with MFs
  • Under SIP insurance plans, mutual funds offer a free life cover on starting SIP investments.
  • Recently AMCs are proposing to introduce bundled products while some existing schemes have such bundled products.
  • Due to this SEBI has informed that no existing schemes or ones which are proposed to be launched shall have bundled products.
  • The life cover, in most SIP insurance products, was in the range of up to 100-120 times the SIP amount, subject to a Rs 50 lakh limit.
  • Most fund houses offered SIP insurance to people in the 18-51 age bracket investing in eligible schemes.
  • They have also added insurance benefits at no additional cost to tap into its popularity.

Question:

Q.1 The Securities and Exchange Board of India has barred _________in India from offering insurance products bundled?
a. Bad Banks
b. Asset management companies
c. Financial Market Apps
d. Mutual Fund Companies
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