General Insurance Business Act to be Amended to Merge National Insurance, United India and Oriental Insurance Company

Following news of merging public sector undertaking (PSU) insurance companies, National Insurance, United India and Oriental Insurance in the 2019-20 budget, Finance Minister Nirmala Sitharaman has sought to amend the General Insurance Business Nationalisation Act.

According to media reports, the Finance Bill has urged to replace the section that says “there will be four companies” with “there will up to four companies.” So, there can be three companies, two companies or only one entity in the government sector.

Besides this, the DIPAM (Department of Investment and Public Asset Management) is also on a lookout for many other alternatives, like stake sale in three state-owned insurance companies. The main objective behind this idea is to fast track sale in the public sector general insurance companies, which has been pending for the past two years.

It is worth remembering that the government had proposed the merger of three non-life insurance companies, National Insurance Company, Oriental Insurance Company and United India Insurance Company in the 2018-19 Budget.