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Informist, Monday, Aug. 11, 2025

 

By Sagar Sen and Priyasmita Dutta

 

NEW DELHI – The government is likely to take a call on the stake sale in the three unlisted public sector general insurance companies after six to eight quarters, a senior finance ministry official said. "The financials of these three insurers have started showing some improvement, but we want to ensure that it improves further and is sustained for 18-24 months," the official told Informist.

 

Currently, the New India Assurance Co. Ltd. is listed on exchanges, while the other three PSU non-life insurers--National Insurance Co. Ltd., United India Insurance Co. Ltd., and Oriental Insurance Co. Ltd.--are unlisted.

 

The government had announced in the Budget for 2018-19 (Apr-Mar) that National Insurance Co., United India Assurance Co., and Oriental India Insurance Co. will be merged into a single entity and will be listed. However, in the Budget for FY22, the government said it would privatise one general insurance company during the year.

 

Notwithstanding these Budget announcements, there has been little movement on the stake sale due to the weak financial performance of the companies. National Insurance Co.'s net loss widened to INR 4.8 billion in FY25, while Oriental Insurance and United India Insurance posted net profit of INR 1.4 billion and INR 1.5 billion, respectively, in FY25. The government had infused INR 50 billion in general insurance companies in 2022. 

 

Over the last few years, the government has been contemplating a number of options for the future of PSU general insurance companies, including mergers, listing on the exchanges, and strategic disinvestment. 

Of the options available with the government, a merger of the insurers is more likely given the lack of investor appetite for government companies after the COVID pandemic. Since the pandemic, the disinvestment department has consistently missed its annual disinvestment targets, leading to the decision to forgo setting a target in the FY25 Budget. The government had raised INR 76.53 billion in 2017 by divesting a stake in New India Assurance.  End

 

Edited by Saji George Titus

 

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