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LS passes Insurance (Amendment) Bill

NEW DELHI May 15 . The Lok Sabha today passed a legislation amending the 1938 Insurance Act allowing cooperatives, brokers and intermediaries in the sector with the Finance Minister, Yashwant Sinha, assuring members that their entry would not harm the interests of lakhs of agents in the country.

Winding up the discussion on the Insurance (Amendment) Bill, 2001, Mr. Sinha said the new norms which include minimum educational qualification and experience only applied to new entrants and not to the existing agents.

He said the Government and the insurance regulatory authority would also ensure that the pitfalls of the cooperative sector in other spheres were not repeated in this sector. The bill provides for more flexibility in the mode of payment of premium through credit cards, smart cards and Internet which will be specified by regulations formulated by the authority. Mr. Sinha said the entry of the cooperatives would help in widening insurance coverage, especially in rural areas.

The Congress and other Opposition parties opposed the bill on the ground that it would hit public sector insurance companies, including LIC and asked the Government to withdraw it.

Mr. Sinha said there was tremendous scope to expand the insurance sector, which compared very poorly with other developed and developing countries. ``It is a rapidly expanding pie. The more the players, the faster the expansion and there is enough for everyone,'' he said. — PTI

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