Finance minister earlier in his speech told that the time has come to find out new ways for infusion of more funds and raise the capital for banks and he also added that the decision on this matter will be taken by the new government. It seems that in year 2013, IRDA increased the exposure limit towards investing funds for sectors like technology and pharmaceuticals from 15 percent to 20 percent.

"Concentration of risk is an issue and we have to achieve a balancing act," said an official with IRDA, and he added that they would also look into the changes in debt and equity structure. Few experts have also said that it might create issues among the insurers if the LIC is asked to bear the burden of providing capital support to banks for a long time.

"There can be a great value for LIC in the long run if the government changes some policies like allowing 49 percent foreign institutional investment in public sector banks (PSBs). Today, PSBs are underperforming for various reasons but when the economy stabilises, their valuation will improve," said Kishor Ostwal, CMD at CNI Research.

The government has promised to keep 51 percent of stake in PSBs and maintain their capital adequacy ratio (CAR) at 8 percent.

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