After posting losses in 2019-20, state owned Oriental Insurance Company (OIC), under its newly appointed CMD SN Rajeswari, has charted out strategies to improve its performance.
OIC had a loss(profit/loss before tax) of Rs 1498 crore, in 2019-20 though it had an investment income of Rs3,796 crore. In 2018-19, the company had losses (profit/loss before tax) of around 500 crore in 2018-19.
The company has finalised its pending results and has set its sight to be profitable with clear-cut strategies as outlined by Rajeswari.
The results during 2019-20 nave not been favourable in view of degrowth in profitable retail business and in addition to the provisions made during the year, said Rajeswari.
The company’s global premium rose by 3.29 per cent year-on -year to Rs12,996 in 2019-20.
“Our immediate focus will be –enhanced customer service, growth in profitable lines, claim management, cost control, use of technology and digital initiative in an accelerated level,'' added Rajeswari.
From Sept 1 onward,these parameters will be continued to be looked into and monitored with more focus. Rajeswari. pointed out..
“The first quarter results provisionally seem to be slightly better than March 2020 due to lock-down reason. As we navigate in a uncertain future bought by Covid -19, going forward our, sincere efforts in the coming period on a day to day basis alone can put us in a comfortable position and company can turn around ,’’ said Rajeswari.
After scrapping their merger proposal,the government has amended the the General Insurance Business (Nationalisation) Act,1972, so that authorised capital of three PSU general insurers- Oriental Insurance Company(OIC),National Insurance Company(NIC) and United India Insurance(UII)-,can be raised to improve their solvency ratios to facilitate the business expansion and profitability of these companies.
It is expected that these companies will get capital infusion of Rs 3,475 crore soon.
Earlier while calling off the two -year old merger proposal among three PSU general insurers,OIC, NIC and UII, the union cabinet had also approved to increase in authorised share capital of NIC to Rs.7,500 croref from Rs 2600 crore and that of UIIC ( Rs 200 crore) and OlC (Rs 250 crore ) to Rs 5,000 crore respectively.
The cabinet also had approved capital infusion of Rs12,450 crore for the three PSU general insurers that included Rs 2,500 crore already infused in these three companies in 2019-20,
The ministry of finance(MoF) had clarified that out of Rs 10,00 croreof fresh capital,Rs.3,475 crore will be released immediately;while the balance Rs,6475 crore will be infused later.