Centre weighs consolidation of public sector general insurance firms

least some quarters of FY25, bringing the consolidation plan back on the agenda.

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“Thistime, the conversation ismore pragmatic,” thesecond person mentioned above said. “The focus is on what is feasible, what strengthens the sector, and what limits future fiscal exposure.”

Discussions to consolidate insurance companies are unfolding alongside similar efforts to reshape India's public banking sector.

Policy push

“It is the government's stated policy to have bare minimum presence of PSUsin the strategic sector, with the remaining to be privatized or merged, or subsidiarized with other central public sector enterprises, or closed,” said CR. Vijayan, former secretary general of the General Insurance Council, addingitis"very natural" that the government attempts merger or privatization in the sector.

Consolidation began with banking, and the same would be rolled out for insurance companies, Vijayan said. ‘How itisdone would be decided by the government. But it will be done now."