Bima Sugm will be officially called as Rashtriya Bima Sugam Nigam Ltd, built with an intial corpus of Rs 200 crore and the shareholding of the company will be widely held amongst life insurers, general insurers and health insurers with no single entity having controlling stake

Hyderabad:

Insurance regulator IRDAI’s board is meeting on Tuesday and among the agenda, it will give its final stamp of approvals to the game changing project Bima Sugam, to be built with an initial capital of Rs 200 crore.

There are also other important measures like new IRDAI’s proposed move raising the surrender value for life insurance policies, especially non-linked or traditional plans which is likely to help policyholders but could hurt life insurance companies, could be discussed along with other proposed regulations like increasing minimum Social and Rural business by the insurers.

The Insurance Electronic Marketplace, a one stop solution for all insurance stakeholder’s vis-a-vis customers, insurers, intermediaries to promote transparency, efficiency and collaboration across the entire insurance value chain, has been a job in progress for the IRDAI and two council- General insurance Council and Life Insurance Council- for the last six months and the final part of the project will begin after IRDAI’s board approves the entire scheme of things.

Earlier, laying down the broad principles for Bima Sugam, the IRDAI had said the Insurance Electronic Marketplace, established through a company formed under section 8 of the Companies Act, 2013, will  be a not for profit entity.

The board of the company will have a policy on revenue model which is self-sustainable.

Bima Sugm will be officially called as Rashtriya Bima Sugam Nigam Ltd and the shareholding of the company will be widely held amongst life insurers, general insurers and health insurers with no single entity having controlling stake.

It will be operative and accessible at all times and will not store or hold any data.

Consultant E&Y is advising a core committee of insurers on how to build the Bima Sugam while search for the CEO of the company will happen soon.      

Having its registered office in Mumbai, the company will have two nominees from the IRDAI on its board besides having its own chairman and CEO, who will be appointed with the consultation of the IRDAI.

Industry sources said initially, the Bima Sugam will have a budget of Rs 200 crore which be raised from all stake from all insurance companies.

Starting with a capital of Rs 200 crore, the shareholders, as and when required, will  contribute to the capital requirement of the company.

State owned Life Insurance Corporation will pick up over 8 per cent in the the Insurance Electronic Marketplace, said Siddarth Mohanty, chairman, LIC.