4. Solvency margin
Solvency margin is an amount in excess of the value of insurers assets over the amount of liabilities. This amount is prescribed by IRDA.
The solvency margin is a minimum amount in excess of value of insurers assets over the liabilities.
It is set by regulators (IRDA) and insurers are required to maintain a required Solvency Margin as per Section 64VA of the Insurance Act 1938.