⇒ Recently, parliament passed The General Insurance Business (Nationalisation) Amendment Bill, 2021.
The General Insurance bill seeks to amend the General Insurance Business (Nationalisation) Act, 1972. The bill seeks to remove the requirement that the Centre should hold not less than 51 per cent of the equity capital in such insurers.
The General Insurance Business (Nationalisation) Amendment Bill, 2021 provides for greater private participation in the public sector insurance companies and to enhance insurance penetration and social protection and better secure the interests of policy holders and contribute to faster growth of the economy.
Major changes from the old bill:
(i) Section 10B of the old Act was omitted to scrap the 51% requirement;
(ii) Section 24B, a new one, has been brought in, which says the Centre can relinquish control of a public insurer from a given date;
(iii) Section 31A, saying that a director who is not a whole-time director will be held responsible for acts of omission and commission by the insurer.
India’s four general insurers in the public sector, NICL, NIACL, OICL and UIICL will be impacted.