Government May Infuse More Capital In General Insurance Companies: Official The government last year reportedly provided INR 5,000 crore capital to three insurers --National Insurance Company Limited, Oriental Insurance Company Limited and United India Insurance Company

By Teena Jose

Opinions expressed by Entrepreneur contributors are their own.

You're reading Entrepreneur India, an international franchise of Entrepreneur Media.

Pexels

The government may have to infuse more capital in the three public sector general insurance companies to improve their financial health, according to a PTI report citing a senior government official. The government last year reportedly provided INR 5,000 crore capital to three insurers --National Insurance Company Limited, Oriental Insurance Company Limited and United India Insurance Company.

Based on the performance in FY23, the finance ministry would take a call as to how much capital they would require to meet regulatory requirements, the official said. They are not in good financial health and funds would be infused in these entities to augment their solvency margin, the official told PTI.

Furthermore, the report stated that the solvency margin is the extra capital the companies must hold over and above the claim amounts they are likely to incur. It acts as a financial backup in extreme situations, enabling the company to settle all claims. As per the regulator IRDAI's mandate, the minimum solvency ratio insurance companies must maintain is 1.5 to lower risks. In terms of solvency margin, the required value is 150 per cent.

Teena Jose

News Desk Reporter with Entrepreneur India

Teena is a post graduate in financial journalism. She has an avid interest in content creation, digital media and fashion.
Technology

Has Artificial Intelligence Arrived At The Sales Function Yet?

There is a saying in the world of AI - Don't model the world; Model the mind

Starting a Business

Market Research: What It Is and How to Conduct It

To boost your competitive advantage, you may want to do market research. Entrepreneur is here with a guide on market research and how to conduct it.

Business Ideas

70 Small Business Ideas to Start in 2025

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2025.

Side Hustle

'I Was Called Crazy': This 27-Year-Old's Side Hustle Hit $30,000 a Month in Under a Year — Now It's Worth Millions

Changing regulations forced Angel Rodriguez's jet ski rental company to shut down, and the young entrepreneur had to figure out his next move — fast.

Leadership

Why Work-Life Balance Is Overrated — and What to Pursue Instead

Managing quality, not time, is the secret to thriving personally and professionally.

Living

3 Types of Vacations That Will Make You a Better Entrepreneur

These vacations give entrepreneurs the restoration they need.