India’s biggest insurance firm is stepping in to rescue the posterboy of the country’s deeply distressed banking sector.

The government-owned Life Insurance Corporation of India will pump in up to Rs 13,000 crore for a 40% stake in IDBI Bank, the worst performer in terms of bad loans last financial year. This is over and above the 11% the insurer already holds in this public sector bank. Needless to say, the investment will be funded by the premiums paid by millions of individual policyholders.

LIC already has more than a 1% stake in over 300 NSE-listed companies, according to PRIME database, a capital markets information provider.

IDBI Bank isn’t its first or lone questionable investment. In the past, it has bought into several firms – Vakrangee, Videocon Industries, and Gitanjali Gems – that went on to face bankruptcy. It has also taken part in every disinvestment programme initiated by the government, rescuing sick state-run companies.

Data: PRIME Database

“There have been so many questions asked about LIC’s investments, but where are the answers? How do we know the bailout of these bad assets by LIC will not stop with IDBI Bank alone?” asked a consultant who advises insurance companies, requesting anonymity. “There needs to be some justification but just because there are interested parties involved there are none.”

Queries sent by Quartz to LIC remained unanswered.

Betting on banks

Set up in 1956, LIC commands a 44% share of India’s insurance market as of March 2018. Over the years, more than 250 million citizens have kept the company well-capitalised. So much so that if it were to hit the stock exchanges, the insurer would be India’s most valuable stock, finance minister Arun Jaitley had said in 2016.

IDBI Bank, on the other hand, has gross non-performing assets of 27.95% of its total advances as of March 2018, the highest among its peers.

Two other lenders in which LIC has significant stakes – 13.62% in Axis Bank and 13.03% in Corporation Bank as of March 31, 2018 –are also distressed. State-run Corporation Bank had gross NPAs of 16.41% at the end of the last financial year. Up to 6.77% of Axis Bank’s loans had soured in this period, even as it also battled a severe leadership crisis.

This is besides the 1% or more stake that LIC has in about 20 other public sector banks, most of them in the red.

Such investments by LIC, especially during these troubled times, are perceived to be made under government pressure. “Earlier in other economies such as Chile, the government has dipped into pension funds in times of distress. So, the government needs to convince the citizens and other stakeholders that next it won’t dip into the employees’ provident funds, etc. to rescue bad-performing companies,” said the insurance consultant.

Moreover, a degree of accountability is imperative since it involves public money.

“There may perhaps be a need for a larger independent public institution like CAG (comptroller and auditor general of India) or a wing of a judiciary body to examine the investment proposal and comfort the savers with some assurance that their money will not be lost and it will keep a track of the firm’s performance over the period of this investment,” said Ashvin Parekh, who runs consulting firm Ashvin Parekh Advisory Services.

This article first appeared on Quartz.