Psus Face The Heat From Private Non-life Insurers

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PSUs face the heat from private non-life insurers

Indian state owned non-life insurers have reported a further loss in market share for Q1of 2007-08. It may be noted that the industry is currently operating according to the free-pricing model. Private insurer ICICI Lombard has displaced public sector insurer Oriental Insurance to attain the status of the fourth biggest insurance company in India.

   
In Q1, the Indian non life insurance sector recorded a 13.4% growth, powered mostly by the growth of the private insurance companies, who have recorded a 22.4% growth as against the measly 7.7% managed by the public sector ones.

It may be noted that, the Indian government owns four non-life insurance companies, New India, United India, Oriental Insurance and National Insurance. In the life insurance sector the government's presence is in the form of Life Insurance Corporation.

As per latest available data, the state-owned insurance companies at present account for nearly 58% of the non-life premium. The state-owned insurance companies have registered a lower growth rate mostly due to the tough competition faced in the arena of property insurance. Private non-life insurers have been extremely successful in acquiring sizable volume of motor insurance business, via dealership tie ups. Major business activity has also been recorded in the Indian health insurance sector, in the concerned period.

Coal India gratuity funds portfolio on the anvil

Coal India Ltd has plans afoot for setting up a gratuity funds portfolio worth around` 2,500 crore. LIC is already managing around` 1,500 crore of this fund via trusts. This fund will ensure secured gratuity payment for CIL's 4.25 lac strong employee base. The scheme will provide tax benefits and also give interest income.

According to Mr Partha S Bhattacharyya, CIL Chairman, the Central Coalfields and the Northern Coalfields will provide the requisite amount for fund creation in 2008-09. Mr. Bhattacharyya also expected Eastern Coalfields and Bharat Coking Coal Ltd to come up with similar plans in near future.

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