India’s Insurance Giant Turns to Wall Street Banks to Hedge Risk

Life Insurance Corp. of India is working with some of Wall Street’s largest banks to hedge its liabilities, according to people familiar with the matter.

The nation’s largest insurer has entered into $1 billion worth of bond forward rate agreements with banks including JPMorgan Chase & Co. and Bank of America Corp. over the past two months, the people said, asking not to be identified as they are not authorized to speak publicly.

In November, LIC announced plans to enter the bond derivatives market and conducted a few small tradesearlier this year. Since then, it has stepped up ...