The insurance industry may soon have a new player--the Maharashtra government which is planning to set up an insurance company in a joint venture with a public sector insurer.
The proposed venture will execute the state government’s general, life and medical insurance-based schemes for stakeholders like farmers, employees, and beneficiaries from the Below Poverty Line (BPL) and Above Poverty Line (APL) categories, reported Daily News & Analysis (DNA).
“The state government runs a number of insurance schemes. The Maharashtra government is examining the establishment of an insurance company to handle this. The company will collect premiums for various covers and settle claims,” a senior state government official told DNA.
The state's finance minister Sudhir Mungantiwar confirmed that the idea is being contemplated. “We are in discussions with the public sector insurance companies… for a joint venture,” he said. The government may be able to reduce costs with its own insurer.
Officials, however, express concerns over the possibility of political interference in the claims payment process if the government ran insurance schemes.
The Maharashtra government currently covers various categories of beneficiaries like the 1.8 million state government employees who get medical and life cover from insurance companies. Government vehicles and unorganised sector workers are also covered by insurance. The state also has a farmer accident insurance scheme and a cashless mediclaim plan covering beneficiaries among the poor.