Three public sector general insurance firms — New India Assurance (NIA), National Insurance Company (NIC) and United India Insurance (UII) — are still headless even though the finance ministry conducted the interviews of nine candidates in May to fill the CMD positions.
The delay comes at a time when the proposal to merge three insurers (NIA, UII and Oriental Insurance) is in a limbo and with PSU insurers — except New India Assurance — starting to lose market share.
While the post of CMD at NIC fell vacant as K Sanat Kumar retired in April, the posts at UII and NIA fell vacant when MN Sarma and G Srinivasan retired in May-end and July-end, respectively.
The Ministry of Finance had earlier short-listed 9 names for interviews in May this year. The Ministry had promoted 16 senior officials of the PSU general insurers as general managers, a fairly large number, considering the fact that three of the firms were expected to merge soon and the merged entity may not need such a large number of GMs. Several of the GMs have residual services of more than two years.
The proposed merger of three PSU general insurers to create a new general insurance behemoth has once again the kept the industry guessing about the deadline for the mega merger that is supposed to be completed by the year end. “We don’t know whether the merger is going to happen. On the other hand, some of the PSU insurers are losing market share and financially they are weak,” said a senior official.
The private sector showed a faster pace (22 per cent year-on-year during FY2018) as compared to the growth of PSU insurers’ 13 percent during FY18, says a ICRA report. As a result, the share of the private players in the overall market improved to 55 per cent in FY2018 from 53 per cent in FY17.
Meanwhile, HG Rokade and C Narambunathan, two General Managers, have been jointly asked to discharge the responsibility of CMD of NIC after Srinivasan retired on July 31, 2018.
State-run Life Insurance Corporation (LIC) will see a series of retirements from September onwards including Usha Sangwan, MD, LIC, who will be retiring in September 2018 and VK Sharma, chairman, retiring in December 2018 and other three existing MDs following them.
There are six senior officials of the corporation, having more than two years of residual services, who will be competing for the top posts of the life insurance behemoth. They include Ganesh Kumar (October 2020), Bipin Anand (July 2021), T Sushil Kumar, Mukesh Gupta (September 2020) and Raj Kumar (2022). The person, who will be succeeding Sangwan, stands a fair chance of becoming the chairman of LIC when Sharma demits office in December, source said.
The next round top level vacancies in the industry will now arise in 2019 when Alice Vaidyan, CMD, GIC Re, PJ Joseph, member, IRDAI retire in July 2019 and January 2019, respectively. The government is expected to dilute its stake in GIC Re and NIA which are already listed on the stock exchanges.