Mumbai: Employee unions of the four state-owned non-life insurers and LIC have given a one-day strike call on March 9 to protest against the Insurance Bill. "We have given a strike call on March 9 to register our protest against the Insurance Bill, which will allow more foreign players to enter the sector and only private players will benefit from the move," said Bharatiya Vima Kamgar Sena (BVKS) president Sharad Jadhav.
Union leaders also said they would like to reiterate their demand for merger of all four state-owned non-life insurers. The Insurance Laws (Amendment) Bill, which provides for raising the foreign investment cap from 26 per cent to 49 per cent, was passed by the Lok Sabha. The bill, seeking to replace an Ordinance on the subject, is likely to be taken up by the Rajya Sabha after the 'Holi' holidays ending Sunday.
"We demand consolidation of all four state-owned general insurers. The idea is to stop them fighting among themselves by offering heavy discounts and thus save public funds. If they stop infighting, it can help save Rs 1,000 crore in premia collected per annum," Jadhav said. The All India LIC Employees' Federation said in a statement that the government is "cheating" people by saying that FDI hike is being done to increase insurance penetration.
The stark reality is that insurance penetration has been continuously declining since 2009 despite 26 per cent FDI earlier, the statement added. "LIC started with a small capital of Rs 5 crore. Now, this government capital has been raised to Rs 100 crore while the total premium earned last year was Rs 2,08,804 crore.
"In contrast, private life insurer ICICI Prudential has a capital base of Rs 5,129 crore but had a premium income of only Rs 13,538 crore, while Bajaj Allianz had just Rs 6,893 crore on a capital of Rs 4,844 crore," Federation general secretary A V Nachane said.
