AIIEA- a unit of All India Insurance Employees Association, assumes that the central government might table a Bill in the upcoming Monsoon session to amend the insurance laws to change the minimum capital requirement, commission structure and allow issue of composite licences.
EXPRESSING displeasure over any potential move by the government to increase privatisation in the insurance sector, (AIIEA) on Sunday organised a press conference in Chandigarh, where it questioned government’s policies related to the insurance sector. AIIEA stressed that the central government might table a Bill in the upcoming Monsoon session to amend the insurance laws to change the minimum capital requirement, commission structure and allow issue of composite licences.
The government is taking the insurance sector to the pre-1956 era which would make this sector vulnerable to fraudulent practices endangering the savings of the people,” the association said.
It also said that the regulator Insurance Regulatory and Development Authority of India(IRDAI) is also planning to crowd the market by announcing that it is likely to issue licences to nearly 20 more companies both in life and non-life insurance businesses. However, AIIEA is of the view, that the government and IRDAI’s plan to give every Indian an insurance policy by 2047 does not mean merely crowding the market. Insurance penetration essentially depends on the level of disposable income, which is unfortunately rather low in India.