General Insurance (Business) Amendment Act 2021

It received presidential Assent on 18th August, 2021. It seeks to amend the General Insurance Business (Nationalisation) Act, 1972.

Need for the Bill: The need of the bill arose to push for higher private participation in public sector insurance companies and raise the level of insurance penetration and thereby social protection.

• Features: Change in the Definition of General Insurance Business - Now, general insurance would be defined according to the definition provided by the Insurance Act, 1938.
• Transfer of Control from the Government - The Amendment provides that the Act of 1972 will not apply to the specified insurers from the date on which the central government relinquishes control of the insurer. Control would mean: the power to appoint a majority of directors of a specified insurer, or to have power over its management or policy decisions.
• Empowering Central Government - The Amendment provides that schemes formulated by the central government in relation to service of employees of the specified insurers will be deemed to have been adopted by the Board of Directors of the insurers.
• Limited Liabilities of Directors - The Amendment specifies that a director of a specified insurer, who is not a whole-time director, will be held liable only for certain acts.