Lok Sabha OKs bill to reduce government stake in public insurers

Finance Minister Nirmala. Pic/PTI

Lok Sabha on Monday passed a bill to amend the general insurance law to allow the government to pare its stake in state-owned insurers.

The General Insurance Business (Nationalisation) Amendment Bill, 2021 seeks to remove the requirement that the central government should hold not less than 51 per cent of the equity capital in a specified insurer.

To provide for greater private participation in the public sector insurance companies, to enhance insurance penetration and social protection, to better secure the interests of policyholders and contribute to faster growth of the economy, it has become necessary to amend certain provisions of the Act, according to the Bill.

As of date, there are four general insurance companies in the public sector - National Insurance Company Limited, New India Assurance Company Limited, Oriental Insurance Company Limited and the United India Insurance Company Limited. One of these will be privatised.

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