mumbai irdai on thursday stopped reliance health insurance co rhicl from selling insurance going forward the company will only able to service its old policies reliance health insurance co is part of anil ambanis reliance group which has been facing serious liquidity issuesthe regulator said that the companys solvency margins the funds it has set aside to meet future claims from its policyholders had dipped to concerning levelsreliance health insurance company rhicl which commenced operations in october 2018 has not been able to maintain the required solvency margin since june 2019 after it came to the knowledge of irdai in the later part of august 2019 a direction was issued to rhicl to restore the required level of solvency margin within a period of one month said irdai in its press release irdai said the company had not complied with its instructions despite repeated follow up the insurer did not improve its capital thereafter the insurer was issued a show cause notice and given another opportunity to present its case as there has been no improvement but further deterioration in the financial position of rhicl in order to protect the policyholders interests said the regulator irdai has also issued directions to reliance health to transfer the entire policyholders liabilities along with financial assets to sister concern reliance general insurance co ltd rgicl with effect from november 15 2019 till that time rhicl has been prohibited from using its assets for any payment other than claim settlementit is estimated that the underlying assets are sufficient to meet the claims of the existing policyholders that may arise in future said the regulatorreliance general insurance has been directed to service the claims of the reliance health insurance policyholders promptly and efficiently with effect from november 15 2019 irdai said it will be closely monitoring the situation to ensure smooth transfer of the portfolio settlement of claims and protection of the interest of the policyholdersin so far as policyholders of reliance health are concerned the authority said it would like to assure them that all their interests have been adequately protected and all genuine claims will continue to be duly honoredgroup company reliance capital in may saw care ratings had downgraded the company to just two notches above junk status over its looming debt reliance capital then that it would raise rs 10000 crore 142 billion from sale of assets towards meeting current liquidity issues and for future growth