Published in ET, September 17, 1999
U.S. Ambassador to India Richard Celeste, together with
officials of U.S. insurance companies, met with heads of the
domestic insurance companies, financial institutions and the
Reserve Bank of India here on Thursday to discuss the potential of
insurance in India.
According to a statement issued by the RBI: "The main
focus of the discussion was the potential in the insurance sector,
into action of insurance products and the technological backup for
providing insurance services both in life and general
insurance."
The statement added that the participants expressed the opinion
that keeping in view the need for long-term funds for the
development of the infrastructure sector as well as other
industrial sectors, the broadening of the insurance sector was an
important issue. Mr. Celeste was accompanied by Mr. David Good,
consul-general and Mr. Jerrold Mallory, consul, Mr. Norman
Sorensen, Principal International, Mr. Dalip Verma of American
International Group, Mr. Sanjay Sachdev, Principle Financial
Group, Mr. Krishna Monie, Sr. economic advisor, and Mr. Zubin
Kapadia, vice-consul economic affairs.
The institutions were represented by chiefs of the Industrial
Development Bank of India, Life Insurance Corporation of India,
General Insurance Corporation of India and UTI. RBI was
represented by deputy governors and executive directors. The
foreign visitors were informed that Insurance Regulatory Authority
Bill was yet to be passed in Parliament and both the IRA and RBI
were examining the role of banks in undertaking insurance business
in consultation with the finance ministry.
The RBI also clarified that there is no restriction for the
banks and development financial institutions to convert themselves
into universal banking entities. "It was only a matter of
time when both could evolve as universal banks keeping in view the
need to maintain parity in applicability of the regulatory
requirements."
