InvestorQ : What is the latest on privatization of general insurance companies by the government of India?
diksha shah made post

What is the latest on privatization of general insurance companies by the government of India?

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Mahima Roy answered.
4 months ago
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In the Union Budget, the government had laid out a grand plan to privatize insurance in a big way. Now, as committed in the Union Budget, the government has indicated that it intends to privatize either Oriental Insurance or United India Insurance. Both these fully owned state general insurers had been loss making companies but their financial health has shown improvement after capital infusions.

In addition, the government is also planning to infuse a sum of Rs.3,000 crore into the capital base of these general insurance companies. Both the above unlisted insurers have shown a distinct and perceptible in their financial performance and the government feels that this could attract interest from buyers.

Apart from the unlisted insurers, the government is also open to the idea of further divesting its stake in New India Assurance, which is already listed on the bourses and where the government currently holds 85.44% stake. The total budgeted divestment target for the fiscal year 2021-22 is Rs.175,000 crore. The government has clarified that it is also open to the idea of merging state general insurers before undertaking their divestment.

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