The Central government has published the General Insurance Business (Nationalization) Amendment Act, 2021 vide notification dated August 19, 2021. The General Insurance Business (Nationalisation) Amendment Act, 2021 seeks to privatise government companies undertaking general insurance business in India.
Key highlights of the Act are:
- Four subsidiary companies of GIC: (i) National Insurance, (ii) New India Assurance, (iii) Oriental Insurance, and (iv) United India Insurance is no longer required to have shareholding of the central government.
- The General Insurance Business (Nationalisation) Act, 1972 will not apply to the four companies from the date on which the central government renounces control of the insurer. Control means: (i) the power to appoint a majority of directors of a specified insurer, or (ii) to have power over its management or policy decisions.
- The Board of directors of the four companies may frame terms and conditions of service of employees. The amendment limits the liability of the Board of the four companies.
*Tanvi Singh, Editorial Assistant has reported this brief.