Lok Sabha passes Bill to amend insurance Act

Lok Sabha on Monday 3rd Aug'2021 passed a law to amend the general insurance business Act. The Bill – The General Insurance Business (Nationalisation) Amendment Bill, 2021 – will allow the government to bring down its stake in State-owned general insurance companies, generate required resources and help public sector general insurers design innovative products. The Bill stated that certain amendments had become ‘necessary’ to provide for greater private participation in public sector insurance companies, enhance the penetration of the insurance sector, provide social protection by securing the interests of the policyholders better and contribute to faster pace of the economic growth. Privatization agenda In her Budget speech for 2021-22, the Finance Minister had announced a ambitious privatisation agenda, including two public sector banks and one general insurance company. Of the public sector general insurance companies - the National Insurance Company Limited, New India Assurance Company Limited, Oriental Insurance Company Limited and the United India Insurance Company Limited-- the government will dilute its shareholding in one company. The name of the company, however, is yet to be finalised.