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New Delhi, <keyword id="47209" type="General" weightage="20" keywordseo="finance-ministry" source="Orion">Finance Ministry</keyword> would consider capital infusion in three loss-making public sector general insurance companies based on their financial performance of nine months. The infusion if required would be made in the fourth quarter of the current financial year, sources said. According to sources, the finance ministry last year asked three insurers -- National Insurance Company Limited, <keyword id="94451" type="General" weightage="80" keywordseo="oriental-insurance-company-limited" source="Orion">Oriental Insurance Company Limited</keyword> and <keyword id="356117" type="General" weightage="80" keywordseo="united-india-insurance-company" source="Orion">United India Insurance Company</keyword> -- to chase bottomlines rather than topline and underwrite only good proposals. The financial review would give some idea about the impact of restructuring initiated on the profitability numbers and the solvency margin, sources said. The solvency margin is the extra capital the companies must hold over and above the claim amounts they are likely to incur. It acts as a financial backup in extreme situations, enabling the company to settle all claims. The government last year provided Rs 5,000 crore capital to three insurers -- National Insurance Company Limited, Oriental Insurance Company Limited and United India Insurance Company. Kolkata-based National Insurance Company Limited was given the highest, Rs 3,700 crore, followed by Delhi-based Oriental Insurance Company Limited (Rs 1,200 crore) and Chennai-based United India Insurance Company (Rs 100 crore). According to sources these companies have been asked to improve their solvency ratio and meet the regulatory requirement of 150 per cent. The solvency ratio is a measure of capital adequacy. A higher ratio reflects better financial health and the ability of the company to pay claims and meet future contingencies and business growth plans. Barring the solvency ratio of <keyword id="6369780" type="General" weightage="80" keywordseo="new-india-assurance" source="Orion">New India Assurance</keyword>, this key indicator of the three public sector general insurance companies stood below the regulatory requirement of 150 per cent. During 2019-20, the government infused Rs 2,500 crore in these three companies. It increased substantially to Rs 9,950 crore in the following year and Rs 5,000 crore in 2021-22. In all, the government infused Rs 17,450 crore into these insurance firms so far to improve their financial health. Public sector general insurance companies are undergoing various reforms, including organisational restructuring, product rationalisation, cost rationalisation and digitalisation. For efficient use of capital and to push profitable growth, the sources said, a set of key performance indicators linked reforms have been initiated by all public sector general insurance companies effective 2020-21, when the maximum capital infusion was made. Of the four state-run general insurance companies only New India Assurance Company is listed on the stock exchanges, the remaining three are wholly owned by the government. The government has already announced its intention to privatise one general insurance company. To facilitate privatisation, Parliament has already approved amendments to the General Insurance Business (Nationalisation) Act (GIBNA). Finance Minister <keyword id="129243" type="General" weightage="80" keywordseo="nirmala-sitharaman" source="Orion">Nirmala Sitharaman</keyword> in the Budget 2021-22 announced a big-ticket privatisation agenda, which included two public sector banks and one general insurance company. "We propose to take up the privatisation of two public sector Banks and one general insurance company in the year 2021-22. This would require legislative amendments," she had said.

Govt may infuse capital in PSU general insurers in Q4 based on performance

Union Finance Minister Nirmala Sitharaman on Thursday said that while government institutions, <keyword id="6368751" type="General" weightage="20" keywordseo="banks" source="Orion">banks</keyword> and <keyword id="114713" type="General" weightage="20" keywordseo="insurance-companies" source="Orion">insurance companies</keyword> were building greater awareness over cyber fraud, there was a need for people also to be more alert against cheats who were out to game the system. Speaking at the 'DATE with Tech' event in the national capital, Sitharaman said the government regularly examines public sector banks and the RBI checks its own systems in order to prevent <keyword id="70382" type="General" weightage="20" keywordseo="cyber-frauds" source="Orion">cyber frauds</keyword>, in which victims are tricked via <keyword id="10861" type="General" weightage="20" keywordseo="phone" source="Orion">phone</keyword> or <keyword id="6369206" type="General" weightage="20" keywordseo="sms" source="Orion">SMS</keyword>, while insurance firms assess their own systems as well. "India is in a transitional stage, we are at a stage where we are transforming from what was before to what is now, which is completely digital," Sitharaman added. She said there is worry on a small scale about people receiving arbitrary calls that trap them and cause them to lose money. "Those people who game the system probably are one notch ahead of us in terms of using and misusing technology. On that, there is a lot of work required. It is a never-ending game because technology is such an animal that keeps moving and racing much ahead of you. You have to be sure that you got the reins in your hand," Sitharaman said. The Union Minister said big organisations with systemically sensitive information should have sufficient technology and staff that are properly educated to firewall their systems on a daily basis. They also need to continuously assess whether the firewall is still capable of doing its job. She also highlighted India's achievement in developing a comprehensive digital infrastructure known as the "India Stack". This initiative, funded by public resources, integrates various digital elements, marking a significant leap in the nation's digitiaation journey which has been appreciated by other countries as well. Sitharaman said in the recent G20 Digital Public Infrastructure conference people were really surprised that a country like India could not only utilise the talent which is available with public funds and be able to scale it up at the ground level.

Banks, RBI keeping close watch to tackle cyber fraud: Sitharaman

Indicating the Narendra Modi government’s aim to pull out the economy from the claws of a crippling slowdown, the Union Cabinet has approved a proposal to increase the <keyword id="44528" type="ORGANIZATION" weightage="80" keywordseo="FDI">FDI</keyword> limit in the <keyword id="6512638" type="UNKNOWN" weightage="80" keywordseo="Insurance-sector">insurance sector</keyword> to 49%. Experts believe that the step taken by the Centre will benefit the companies first and consumers later.
 According to the market analysts, the move will benefit the <keyword id="114713" type="UNKNOWN" weightage="80" keywordseo="insurance-companies">insurance companies</keyword> as they will get the much required long-term capital. On the other hand, these companies will take time to bring out newer products and services for the consumer. Analysing the step taken by the Cabinet, it is believed that the management control will remain in the hands of Indian promoters. The amendment to the <keyword id="87391" type="UNKNOWN" weightage="80" keywordseo="Insurance-Laws">Insurance Laws</keyword> (Amendment) Bill will now be taken up in the Parliament. According to <keyword id="50041" type="CITY" weightage="80" keywordseo="KPMG">KPMG</keyword>, one of the largest professional services companies in the world, the higher cap could fetch investments up to Rs 25,000 crore. 
	 

	Shashwat Sharma, KPMG (India) partner, said, "Once there is proper clarity on the interpretation of control by Indian promoter, the additional foreign capital expected across life, health and general insurance companies is between Rs 20,000 to 25,000 crores.”
 

	Kshitij Jain, MD and CEO, Exide Life Insurance, welcomed the step taken by the Modi government. The Indian private life insurance companies have in the last 12 years received over Rs 34,000 crores of capital, said Jain. The capital requirement to fuel growth over the next 5-10 years will be as much or more, he added.
 

	If we peep into the past, the insurance sector was opened up for private sector in 2000 after the enactment of the Insurance Regulatory and Development Authority Act, 1999. This Act permitted foreign shareholding in insurance companies to the extent of 26%. The aim behind this was to provide better insurance coverage and to augment the flow of long-term resources for financing infrastructure.
 

	On the contrary, a section of the market experts also had a word of caution for the companies.
 

	Rahul Aggarwal, CEO, Optima Insurance Brokers, said, “Many international insurance companies will enter India, after all we not only have more volumes but also growth potential. This means, there will be another bout of increased competition among players, due to which companies will face margin pressures."
 

	According to Kshitij Jain of Exide Life Insurance, this is a concern in the long term. Currently, there is enough scope for growth for all the companies falling under this category, he said. As per Jain, the reason behind this is that the penetration of insurance in the country is abysmally low.
 

	This is the reason that these companies are so confident about the decision taken by the Centre. The domestic insurance firms also want more foreign companies to set up their business in India so that they can reap the benefit out of it.

	(Image: Thinkstock)

'Achche Din' For Insurance Companies, Cabinet Clears 49% FDI

<ul class="summary-list"><li>On Wednesday night, some of <keyword id="67784" type="ENTERTAINMENT" weightage="60" keywordseo="Times-Square">Times Square</keyword>'s iconic billboards went dark for one minute to draw attention to businesses struggling during the pandemic. </li><li>The efforts were organized by Business Interruption Group, a coalition of restaurant and hospitality industry leaders who say <keyword id="114713" type="COMPANY" weightage="60" keywordseo="insurance-companies">insurance companies</keyword> are weaseling out of paying business-interruption claims.</li><li>After the blackout, Whoopi Goldberg joined in a video calling on insurers and the federal government to do more to support businesses. </li></ul>A number of Times Square's famously bright billboards <a href="https://abc7ny.com/times-square-billboards-goes-dark-coronavirus-update/6215177/">went dark for one minute</a> on Wednesday night to draw attention to businesses and nonprofits that are struggling during the pandemic. The effort was led by the Business Interruption Group, a coalition of restaurant and hospitality industry leaders who says <keyword id="35450" type="COMPANY" weightage="60" keywordseo="insurance">insurance</keyword> companies are using technicalities to get out of paying business interruption claims, <a href="https://www.cfodive.com/news/restaurants-insurers-pay-business-interruption-claims/577243/">according to CFO Dive</a>. Their founder members include superstar chefs like Wolfgang Puck, Daniel Boulud, Cat Cora, and Thomas Keller.<div type="image" title="Times Square goes dark " height="1334" width="2000" msid="76100599" hostid="261"></div>BIG partnered with Times Square Alliance and the NYC Hospitality Alliance on the blackout, hoping to send a symbolic message "that the insurers are turning the lights out on businesses," John Houghtaling, BIG's general counsel, <a href="https://www.cnn.com/2020/05/27/us/times-square-goes-dark-trnd/index.html">told CNN</a>. At 9 pm, over 100 million LED pixels went dark for 60 seconds on signage from 46th Street to 48th Street on Broadway and along the entire corner of 47th and 7th Avenue. A video featuring entertainers, business owners, and community leaders then ran on the billboards to underscore the message."Insurance companies and the federal government need to do the right thing now," Whoopi Goldberg said in the video. A staggering <a href="https://www.businessinsider.com/us-weekly-jobless-claims-unemployment-filings-coronavirus-labor-market-layoffs-2020-5">40 million Americans have lost their jobs during the pandemic</a>, and countless businesses have been forced to close their doors and lay off employees. <div type="image" title="Times Square blackout" height="1334" width="2000" msid="76100601" hostid="261"></div>Read the original article on <a href="https://www.businessinsider.com/times-square-billboards-went-dark-to-support-uninsured-businesses-pandemic-2020-5">Business Insider</a>

Times Square billboards went dark for one minute to show support for struggling restaurants and hospitality businesses

New Delhi, Reliance Capital's (RCAP) expression of interest (EOI) for asset monetisation garnered mega response with 60 bids being received. <keyword id="13222" type="DOMAIN" weightage="20" keywordseo="SBI">SBI</keyword> Life and Apollo are among the 10 new bidders who have submitted expressions of interest for Reliance Capital's assets, taking the total number of bids to 60. December 1 was earlier the deadline for the submission of EOIs. Over 60 different bids have been received with SBI Capital Markets Limited and JM Financial Services Limited, the advisors to the lenders. Later the date for submitting the bids was extended to December 17. Over eight bidders have bid for entire RCAP assets on an as-is-where-is basis. The prominent among them are Oaktree, J.C. Flower and multiple ARCs. For Reliance General Insurance, which is owned 100% by RCAP, there are 18 bidders and prominent among them are, Chryscap, J.C. Flower, Blackstone, KKR, CVC Capital Partners, and Bain Capital. For Reliance Nippon Life Insurance, in which RCAP owns 51% controlling stake, has received 16 bids, including Bain Capital, NIIF, Arpwood Partners, Dabur Investments, Bandhan Bank, and <keyword id="884924" type="COMPANY" weightage="20" keywordseo="Multiples-Asset-Management">Multiples Asset Management</keyword> among others. For Reliance Securities, there are eight bidders, including Bain Capital, Religare Broking, Edelweiss Securities and other ARCs. For Reliance ARC, there are six bidders, including Bain Capital, International Asset Reconstruction Company and other ARCs. For Reliance Health, there are eight bidders - Blackstone, Bain Capital, Arpwood Partners, and other ARCs. There are also multiple bidders for RCAP's stake in ICEX and Paytm E-commerce business. Reliance Capital asset monetization process, to unlock value of its underlying businesses and to make RCAP debt free, was launched on October 31, 2020. The monetization process being run under the aegis of Committee of Debenture Holders and <keyword id="10477607" type="COMPANY" weightage="20" keywordseo="the-debenture-trustee-vistra-itcl-india-ltd">the Debenture Trustee Vistra ITCL India Ltd</keyword> - which represents 93% of total outstanding debt of Reliance Capital. EOIs were invited for all or part of RCL's stake in the following key subsidiaries and assets individually or in any combination thereof. This includes 100% stake in Reliance General Insurance Company Limited (RGI). It has a paid up capital of Reliance General Insurance is ₹252 crore as of September 30, 2020. It is the 4th largest <keyword id="10477608" type="COMPANY" weightage="20" keywordseo="private-general-insurance-company">Private General Insurance Company</keyword> with market share of 4.5% as of March 2020 in the General Insurance category. It has shown consistent growth in AUM Year-on-Year with investment book of ₹12,315 crore as on September 30, 2020. The company performed its best even during COVID times with Gross Direct Premium Income of ₹4,501 crore during the first six months of FY20- 21. It has a strong distribution network of 134 branches with amongst largest agency force of 46,742 as of September 30, 2020 across the country. Bids have been invited for 51% stake in <keyword id="10203731" type="COMPANY" weightage="20" keywordseo="reliance-nippon-life-insurance-company-limited">Reliance Nippon Life Insurance Company Limited</keyword> (RNLI). The paid up capital of Reliance Nippon Life Insurance is ₹1196 Cr. as of September 30, 2020. RNLI is a joint Venture with Japan's largest life insurer - Nippon Life which holds 49 % shareholding. It is the 10th largest <keyword id="10203730" type="COMPANY" weightage="20" keywordseo="private-sector-insurer">Private Sector Insurer</keyword> (in terms of Individual WRP) and amongst largest Non-Banca company with a network of 717 offices. It witnessed sharp turnaround in performance during FY19-20 with a profit after tax of ₹35 crore and 75% growth (12% CAGR) in embedded value over last four years. It has an impressive claim settlement ratio of 98.1% in FY19-20 and a higher Solvency ratio of 207% (as against regulatory requirement of 150%). As on September 30, 2020, the AUM was ₹21,912 crore and an individual premium market share of 2.20% amongst private insurers. Bids have been invited for 100% stake in Reliance Securities Limited - Broking &amp; distribution company offering services across asset classes including equities, commodities, derivatives, currency, mutual funds, bonds and corporate FDs. Also on offer is a 100% stake in Reliance Financial Limited - RBI registered NBFC, engaged in the business of financing, money lending, capital market linked financing activities, 49% stake in Reliance Asset Reconstruction Limited which manages portfolio of ₹1,996 crore as on September 30, 2020. A 20% stake in Indian Commodity Exchange is also being bid. Other key shareholders in ICEX are Central Warehousing Corporation, MMTC Limited, Indiabulls Housing Finance Limited, Indian Potash Limited and Bajaj Holdings and Investments. ICEX is a SEBI regulated commodity derivatives exchange. There is also 100% stake in Reliance Health Insurance Limited. Other PE investments like Naffa Innovations Private Limited, Paytm E-Commerce Private Limited. RCL's key businesses and subsidiaries are performing well and business will continue as usual. The management, professional team, customer and partners will be unaffected by the proposed asset monetisation programme of RCAP. SEE ALSO: <a href="https://www.businessinsider.in/stock-market/news/top-stocks-to-watch-spicejet-interglobe-aviation-tata-motors-pfizer-asian-paints-niit-lupin-and-others/articleshow/79849749.cms">Top stocks to watch – SpiceJet, InterGlobe Aviation, Tata Motors, Pfizer, Asian Paints, NIIT, Lupin, and others</a> <a href="https://www.businessinsider.in/stock-market/news/how-to-check-mrs-bectors-food-specialities-ipo-allotment-status-online/articleshow/79808672.cms?upcache=2">Mrs Bectors Food Specialities IPO allotment today: Here’s how to check share allotment status</a> <a href="https://www.businessinsider.in/business/startups/news/google-microsoft-invest-in-dailyhunt-for-its-short-video-platform-josh-making-it-the-latest-unicorn-in-india/articleshow/79850804.cms">Google, Microsoft invest in DailyHunt for its short video platform Josh – making it the latest unicorn in India</a>

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Govt may infuse capital in PSU general insurers in Q4 based on performance

PTI

Banks, RBI keeping close watch to tackle cyber fraud: Sitharaman

IANS

'Achche Din' For Insurance Companies, Cabinet Clears 49% FDI

BI India Bureau

Times Square billboards went dark for one minute to show support for struggling restaurants and hospitality businesses

Natalie Colarossi

Reliance Capital asset sale: SBI Life and Apollo join the race, nearly 70 bids received so far

IANS

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