Competition Commission of India lens on PSU general insurers
An advisory sent out by the financial services department in the finance ministry to the four general insurers, relating to fixing their tariffs, has caught the attention of the Competition Commission of India (CCI). Mahua Venkatesh reports.business Updated: Nov 30, 2012 21:23 IST
Are the state-owned general insurance companies colluding to fix tariffs?
An advisory sent out by the financial services department in the finance ministry to the four general insurers, relating to fixing their tariffs, has caught the attention of the Competition Commission of India (CCI).
The anti-trust body would launch a probe to ascertain whether the move would impact the end consumers while ruling out any possibility of cartelisation. "We would launch an investigation to see if there would be any impact on the consumers and if this would lead to a situation where all the four companies would have to act in concert," said Ashok Chawla, chairman, CCI.
The four state-owned general insurers - New India Assurance, United India Insurance, Oriental Insurance and National Insurance Company - control more than half of the country's health insurance market. The insurance companies refused to throw any light on the issue.
The CCI has underlined that the public sector would be treated on par with the private sector to ensure fair play. "No preferential treatment would be meted out to any company be it public sector or private," said Chawla.
The general insurance sector was de-tariffed from 2007 with a view to allow companies to decide and offer prices and products, based on their individual analysis and perception of risk.
The penetration level in the non-life segment is currently a dismal 0.76% in India.