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General Insurance (Nationalisation) Amendment Bill passed by Parliament

  • Integrity Education, Delhi
  • 12, Aug 2021
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  • 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.