Lok Sabha passes bill to amend public sector general insurance law

Illustration: Binay Sinha

Lok Sabha on Monday passed a bill to amend the general insurance law to allow the government to pare its stake in state-owned insurers.

The General Insurance Business (Nationalisation) Amendment Bill, 2021 is aimed at generating required resources from the Indian markets so that public sector general insurers can design innovative products.

As per the statement of objects and reasons of The General Insurance Business (Nationalisation) Amendment Bill, 2021, it seeks to remove the requirement that the central government should hold not less than 51 percent of the equity capital in a specified insurer.

To provide for greater private participation in the public sector insurance companies, to enhance insurance penetration and social protection, to better secure the interests of policyholders and contribute to faster growth of the economy, it has become necessary to amend certain provisions of the Act, according to the Bill.

The Bill was introduced on Friday by Finance Minister Nirmala Sitharaman.

The Finance Minister in the Budget 2021-22 had announced a big-ticket privatisation agenda which included two public sector banks and one general insurance company.

"We propose to take up the privatisation of two Public Sector Banks and one General Insurance company in the year 2021-22. This would require legislative amendments," she had said at the time.

As of date, there are four general insurance companies in the public sector - National Insurance Company Limited, New India Assurance Company Limited, Oriental Insurance Company Limited and the United India Insurance Company Limited.

Now, one of these will be privatised for which the government is yet to finalise the name.


(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)


Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel