Page 6 - Insurance Times March 2017 Sample

Dangal's high insurance GIC, New India may be the first insurers to get IPO listing

shows Amir's faith
The General Insurance Corporation of the gov-
Aamir Khan-starred Dangal has not India (GIC Re) and New India Assur- ernment,
only smashed all-time Bollywood box- ance Company are likely to get the first and issue
office record but has also taken high- initial public offering (IPO), following of fresh eq-
est distribution insurance of Rs. 270 the government's decision to allow uity by
crore. This goes to show that Aamir state-owned non-life insurers to list. GIC".
Khan, who has also produced the However, both companies will list only
movie, was certain about its success. in the next financial year as the pro- The Cabi-
net has
cess required for an IPO, is expected
Proposal for 2-tier TPA li- to take six to eight months. cleared the listing of five non-life insur-
ance companies, which includes Na-
ability for motor vehicles GIC Re Chairman Alice Vaidyan said, tional Insurance, Oriental Insurance,
"GIC Re has a net worth of Rs 40,000 and United India, in addition to New
crore, and assets close to Rs 80,000 India and GIC. The cabinet approval is
crore. The public issue would be com- for a 25% dilution with the govern-
bination of offer for sale of shares by ment holding the residual 75%.

1 in 4 consumer cases linked to insurance sector

One in almost every five cases in con- show that there were 34,704 pending
sumer forums is related to the insurance cases relating to the insurance sector
sector, followed by complaints relating out of the total 1.67 lakh cases.
The non-life insurance industry has to the housing and banking sectors, ac- "Usually, insurance products are mar-
proposed a suggestion to the govern- cording to a sample keted and sold by agents
ment to initiate a two-tier third-party analysis done by the whom consumers know
liability cover for motor vehicle own- consumer affairs min- for years. They sign docu-
ers. A two-tier system would keep istry.
ments in good faith even
premium on the mandatory cover The latest data without going through
under check and at the same time shared by the ministry the terms and condi-
would enable those who did not want with the state govern- tions. Agents even take
to take the liability on themselves to ments recently show the responsibility to col-
buy additional cover from non-life that at present about
companies. 4.15 lakh cases are pending before dif- lect the premium from the consum-
ers," said Suresh Misra, professor of
The proposal comes in the wake of ferent consumer forums, nearly three- consumer affairs in Indian Institute of
the government's move to amend fourth of them at the district level. Public Affairs. He said the consumers
the Motor Vehicles Act. Besides pro- The analysis of data of pending cases come to know about the terms and
viding for higher penalties for of-
till 2015, available on internet-based conditions only when they apply for
fences, the amendment incorporates
case monitoring system Confonet, compensation or claims.
a number of measures to take care
of accident victims. These include Crop insurance scandal under lens
providing cashless treatments and
higher compensation for hit-and-run The Maharashtra government has come across major irregularities in insurance
victims. claims made by farmers in 2015. Most anomalies were reported from
Marathwada, the worst affected region in the 26 drought-hit districts that year.
"In Japan too, there is a two-tier system
and a large section of the policyholders The state government had disbursed a record Rs 4,205 crore as insurance.
go in for the voluntary cover," said R
Chandrasekaran, security general, Gen- The Maharashtra Agriculture Department is investigating all insurance claims
eral Insurance Council. The compulsory made by farmers after it came to light that in Beed district alone, Rs 58 crore
cover would still cover over 90% of the insurance money was sanctioned for farmers, claimed illegally and the banks
claims based on historical data. had to reverse that amount to the state exchequer.
6 The Insurance Times, March 2017

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