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Demand for merger of state-run general insurers rises

New India, Oriental, United and National insurance have invested around 1.7 lakh crore in the Govt securities and infrastructure development, and underwritten 9 crore PM Suraksha Bima Yojana policies

Reinsurers firm on risk underwriting
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Reinsurers firm on risk underwriting 

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Mumbai: Employees' union of state-owned general insurance has raised demand for merger of all the four state-run general insurers, on the lines of LIC.

Not to mention that the Life insurance Corporation of India (LIC), which is currently in IPO mode, was set up on September 1, 1956, when Parliament passed the Life Insurance of India Act that nationalized the insurance industry in India. Over 245 insurance companies and provident societies were merged to create the state-owned corporation.

The four companies - New India, Oriental, United and National- have invested around 1.7 lakh crore in the Govt securities and infrastructure development. These companies have underwritten 9 crore Prime Minister Suraksha Bima Yojana policies, a pet project of the Modi government.

The cover provides Rs2 lakh compensation for a premium of mere Rs12. The 27 private companies sensing the claims ratio have underwritten very less policies.

These public-sector general insurance companies underwrite nearly 20 per cent of the business in rural areas and are pioneers in cattle insurance. Despite intense competition from private general insurance companies, public-sector GI companies command around 42 per cent market share. This could have been much higher had the four State-run companies been merged into a single entity akin LIC. Privatisation of public-sector general insurance companies is detrimental to the interests of the people of this country, they say.

"Therefore, the need of the hour is to strengthen the public sector general insurance companies. The entire work force of the these companies are facing lot of uncertainties about their job security, service conditions and other benefits due to provision of newly adopted GIBNA amendment Act 2021. The workforce of these companies, both working and retired, is seriously concerned about the impact of these provisions in their livelihood. Therefore, we once again demand to repeal this act," says Trilok Singh, convener, Joint Forum of All Trade Unions and Associations (Northern Zone).

The unions and associations feel that good sense should prevail on the Department of Financial Services and General Insurance Public Sector Association (GIPSA) management failing which we will be forced to go for bigger and wider trade union actions throughout the company, he added.

The countrywide relay dharna on November 15-19, followed by lunch hour demonstration was observed in all head offices, regional offices and other centers opposing privatization, disinvestment and demanding immediate settlement of long pending wage revision which is due from August 1, 2017, update of family pension from 15 per cent to 30 per cent, enhancement of NPS contribution to 14 per cent and 1995 pension scheme to all newly recruited employees and officers. More than 50 thousand employees and officers have been continuously struggling for the last 51 months to meet out their legitimate demands.

It is painful for the entire workforce, he went on, who worked as corona warriors in the period of Covid-2019 pandemic in such tough time and gave their best contribution over the past many years. As per the record, thousands of crores of rupees were given to the Govt of India by the public sector general insurance companies and also incurred heavy losses suffered during the country's worst disasters viz earthquake, floods and riots in the last 50 years. Regardless of 1984, riots Gujrat riots, Gujarat earthquake and Kedarnath disaster, during the terrible flood and tsunami in Assam, Bihar Chennai and Mumbai etc and during the heavy rains, hailstorms and storms this industry was the biggest saviour of the countrymen under its welfare policy.

These public-sector insurance companies are working for the ordinary people of this country and provide general insurance service to the entire society and serve more than 50 crores people of this country through Fasal Bima Yojana schemes, PM Ayushman Bharath Scheme, Suraksha Bima Scheme and many other social sector schemes which are not being done by the private insurance companies.

Kumud Das
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