Categories: Economy

Cabinet to infuse Rs 12,450 crore into three state owned general insurance companies

The Union Cabinet has approved capital infusion of Rs 12,450 crore into three public sector general insurance companies– Oriental Insurance Company (OIC), National Insurance Company (NICL) and United India Insurance Company (UIIC).

While a sum of Rs 3,475 crore will be released immediately the remaining Rs 6475 crore will be injected later.

Information and Broadcasting Minister Prakash Javadekar, briefing the media on the decision, said that the amount includes the Rs 2,500 crore infused in the last financial year. The Cabinet meeting was chaired by Prime Minister Narendra Modi.

The government has also said that the focus now will be on profitable growth of these insurers. Earlier, in the Union Budget 2018, the government had said that the general insurance companies would be merged with the idea of creating a strong insurance company.

The Cabinet has also given its nod to increase in authorised share capital of NICL to Rs 7,500 crore and that of UIICL and OlCL to Rs 5,000 crore respectively to give effect to the capital infusion.

The capital infusion of Rs 3,475 crore will be allocated to the insurers OlCL, NICL and UIICL as the first tranche in the current financial year and balance amount will be released in one or more tranches..

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