Special Mention in Rajya Sabha by Dr. Bharatkumar Raut, MP on LIC

You are aware of the sustained campaign by the BMS affiliated unions (NOINO / NOIW / NOIP / BLIAS) in LIC against the proposed amendments in the Insurance Act & LIC Act. You are also aware that the Maha-Dharana organized by the above 4 unions on 1st August 2011 in New Delhi was a grand success forcing the Government to keep the issue on the back-burner in this session. Many MP's actively supported this movement(Dr. Murali Manohar Joshi, Prakash Javadekar, Chandan Mitra, Bhagatsingh Koshyary, Sumitra Mahajan(All BJP); Kalikesh Singhdeo(BJD); Sharad Yadav(JD-S); Dr.Bharatkumar Raut (Shivsena)).

However, to keep up the pressure, we requested Dr. Bharatkumar Raut to make a special mention in the Rajyasabha. Based on a note prepared by us, Dr. Raut was kind enough to make a special mention in the Rajyasabha yesterday, i.e. 25th August 2011. A written reply is awaited on this matter from the Finance Ministry. We will keep you updated on the same. We once again thank Dr. Raut for taking up our cause in the Parliament.

                                                                       

SPECIAL MENTION IN RAJYA SABHA on 25-8-2011

by DR. BHARATKUMAR RAUT, M.P.

Proposed motive of the Central Government for Corporatization of LIC through amendments in Insurance Act, 1938 & LIC Act, 1956

            Sir, I wish to mention an important issue of proposed amendments in Insurance Act.  The proposal to further hike FDI in Insurance Sector from 26% to 49% and other proposed amendments will affect crores of policy holders and its employees, officers and agents.

            Life Insurance Corporation is the backbone of the Indian economy with its huge investment in public infrastructure.  It is also a stabilizing factor in the volatile market.  With huge funds, its role will be more crucial in the days to come.  The need of the hour is to give some more incentives to LIC, not to cut its limbs by diluting and removing the sovereign guarantee on LIC policies.

            The proposed amendment to distribute 90% instead of existing 95% of the valuation surplus to its policyholders would mean that they would get lesser bonus.  This will affect LIC's credibility and image, ultimately reducing its business.  The proposed amendment that 5% of valuation surplus may be utilized by the Central Government in any manner that it thinks fit is devoid of logic. 

            The proposal of increasing the equity capital of LIC from 5 to 100 crores  and then to any extent through the notification shows the intention of Government to by-pass the Parliament and corporatize LIC through a public issue at a later date.

            I request the Government to stall the proposed amendments and save  the interests of LIC and its policyholders, officers, employees and agents.