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Bid to deny wage revision, say insurance officers

By Our Special Correspondent

CHENNAI, JAN. 23. Officers in the general insurance industry have protested to the General Insurance Public Sector Association (GIPSA), the umbrella organisation of managements of public sector insurance companies, over attempts to deny due level of wage revision citing grounds ``which were the result of policies pursued by the Government and the GIPSA''.

In a recent communication to the GIPSA, the Oriental Insurance Company Officers Association said that allowing unethical rebating by private sector insurance companies leading to loss of profitable portfolios to the private sector, failure to get the tariffs for motor insurance revised in tune with the risks and creation of alternative channels of distribution were the result of Government policies and failures.

Negative factors

Addressing a press conference here today, J. Cyril, president of the officers' association, said that despite these negative factors beyond the control of employees, limited industrial growth reflected in stagnation of the market for general insurance and reduction of officer strength through a ``special voluntary retirement scheme'', the public sector companies had given a good account of themselves as was evident from their annual reports and dividend declared to the Government.

Mr. Cyril said while the officers were prepared to discuss issues in the interest of the company and the nationalised sector of general insurance, attempts during the ongoing wage negotiations to deny justice to officers and offer them hikes less than the offers made in the banking and life insurance sectors would not help arrive at an amicable solution.

He said the Government was consistently refusing to offer a vision or roadmap for strengthening the public sector insurance companies as promised by it. It also refused to consider suggestions for either the merger of the four companies into one entity or starting zone-wise companies (north, south, east and west).

Discounting of premium

Mr. Cyril said the refusal of the regulatory authority to allow direct discounting of the premium to corporate customers by public sector companies as had been the practice for long and forcing them to pay commissions to intermediaries was artificially propping up the position of private sector players. The private sector companies had not fulfilled claims made by policy-makers at the time of opening up of the sector that these companies would expand the market and take aggressively to marketing of personal products. At the same time, the Government had imposed a restriction on the advertisement and publicity budget of public sector insurers to one per cent of the premium income. He also claimed that it was the private sector that was resisting detariffing of more lines of products for fear of competition from the public sector.

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