Public sector GI firms to look at finances

The finance ministry has asked two public sector general insurance companies—Oriental Insurance Co. Ltd and United India Insurance Co. Ltd—to improve their finances as the government looks to list the state-owned non-life firms.

“There are issues with two firms and they have been asked to pull up their socks and rev up their finances,” people in knowledge with the matter said to the Economic Times. The sources expected the situation to get better soon.

Due to huge underwriting losses, United India Insurance and Oriental Insurance, have suffered net losses of USD4.29 billion and USD3.82 billion, respectively in the first half of the current fiscal. Both were profitable companies in the previous year.

While United India had posted a net profit of USD3.56 billion, Oriental Insurance had registered a profit of USD3.35 billion a year ago.

United India’s solvency ratio, against a regulatory requirement of 150 percent, currently stands at 1.56 percent while the Oriental’s solvency ratio has fallen to 1.14 percent during the reporting period.