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PSU general insurers to initiate merger process on Feb 16

IANS  |  Kolkata 

Three state-run general companies -- United India Company, National Company (NIC) and Oriental Company -- are expected to meet on February 16 to initiate their proposed merger plan, an said here on Tuesday.

The three companies are expecting the merger formalities would be completed before the vote on accounts next year.

"The merger is expected to be completed before the government presents the vote of account early next year. The chiefs of the three general companies will have a departmental meeting on February 16 to discuss the Budget pronouncements," United India Insurance's CMD M. N. Sarma said on the sidelines of a health summit organised by

In his budget announcements, Union Finance Minister, proposed three public sector general companies would be merged into a single entity and would be subsequently listed.

Another PSU general insurer New India Assurance, the biggest among government-owned general insurers, had got listed in the bourses.

Elaborating on the merger, Sarma said that it would help insurers to consolidate their strengths.

"Like each one of us has 30 regional offices so total number is 90. But after merger we can keep only 30 offices so the merged entity can reduce costs significantly," he said.

Sarma also claimed there would be no retrenchment following the merger.

However, NIC's CMD K Sanath Kumar said the roadmap for the merger would be laid out by the government.

Incidentally, the combined gross direct premium underwritten of these three companies taken together was over Rs 40,000 crore by end of 2016-17.

The merging of the three state-run insurers will lead to the creation of a giant non-life company and it is expected to be a major contributor to the divestment target of Rs 80,000 crore set for the fiscal 2018-19.



(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Tue, February 13 2018. 20:34 IST