General Insurance (Nationalisation) Amendment Bill passed by Parliament

• Integrity Education, Delhi
• 12, Aug 2021

• The 1972 Act set up the General Insurance Corporation of India (GIC).
• The businesses of the companies nationalised under the 1972 Act were restructured in four subsidiary companies of GIC:

(i) National Insurance
(ii) New India Assurance
(iii) Oriental Insurance
(iv) United India Insurance.

• The Act was amended in 2002 to transfer the control of these four subsidiary companies from GIC to the central government, thereby making them independent companies.
• Since 2000, GIC exclusively undertakes reinsurance business.

Significant Change in 2021 Bill

• The Act requires that shareholding of the central government in the specified insurers (the above five companies) must be at least 51%.
• The 2021 Bill removes this provision thereby paving the way for more private investment.