State-run general insurance companies are unlikely to receive any capital infusion from the government in the current fiscal year ending 31 March 2024 (FY2024), a senior finance ministry official has said.
The government will review the need for any capital infusion in the public insurers only next year, Money Control reported, quoting the official.
There are four government-controlled general insurance companies in India, namely, the listed New India Assurance, United India Insurance, Oriental Insurance and National Insurance. The latter three insurers have been reported to need additional capital.
“No capital infusion is needed in non-life public insurance companies at least in this fiscal (year). Their financial condition is not so bad. They are sustaining. In fact, one of the insurance companies will also give a dividend to the government in FY24,” the official said.
Earlier this month, officials told the newspaper Economic Times that the Indian government wants state-owned insurers to make changes to their strategies to improve their market share which has been falling compared with private-sector players.
At a review of the performance of state-owned insurers, the general insurers were informed that capital infusions would not be provided to them just to cut losses and they needed to draw up strategies to work on their revival
The government last pumped capital into the state-owned general insurers in FY22, namely, National Insurance, Oriental Insurance, and United India Insurance. Kolkata-based National Insurance was given the highest INR37bn ($44.8m), followed by INR12bn to Delhi-based Oriental Insurance, while Chennai-based United India Insurance Company received INR10bn.
