April 30, 2018
The proposed consolidation of National Insurance, United India and Oriental Insurance will decide the fate of 41,000 employees.Among the first casualties of a horizontal merger of three state-owned general insurers would be the elaborate layers of coordinating management.
The three public sector insurance companies reported a combined underwriting loss of INR155.91 billion (US$2.33 billion) for the financial year ended 31 March 2017.
Whether their merger will help in lowering losses from core operation will depend on how the merged entity goes about cutting costs. The biggest challenge will be streamlining manpower and the government will have to come out with a voluntary retirement scheme to let people move out.