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Best Government Insurance Companies in India

Best Government Insurance Companies in India

Prior to the year 2000, the insurance segment in India was dominated by Government insurance companies. However, the Government formed the Malhotra Committee in the year 1993 to suggest reforms in the insurance sector. As per the recommendations of the committee, the Insurance Regulatory and Development Authority of India (IRDAI) was formed and the insurance segment was opened to private companies. Since the year 2000, both life and general insurance segment have seen different private companies tying up with foreign companies to sell insurance products. The market has, therefore, become competitive. However, there are still some insurance companies which are owned by the Government of India. Let’s see the list of govt insurance companies in India–

Table of Content

List of Govt Insurance Companies for Life Insurance in India

The Life Insurance Corporation of India (LIC)

The Life Insurance Corporation of India was formed in the year 1956 when the Government nationalized the business of life insurance. From 1956 to 2000 LIC enjoyed a monopoly position in the country selling life insurance policies. Even today LIC has the largest market share in the life insurance segment. The company offers all types of life insurance plans like term plans, endowment insurance, money back plans, pension plans, ULIPs, health plans, etc.

List of Government Insurance Companies for General Insurance in India

In the general insurance segment, there are four public sector companies which are government insurance companies in India. These companies include the following –

The New India Assurance Company Limited

The New India Assurance Company Limited has a rich heritage as it was founded by Sir Dorabji Tata, a leading industrial stalwart. The company came into existence in the year 1919 with its headquarters in Mumbai. The company, which started in India, now has operations in 28 countries of the word. As of March 2017, the company’s global business surpassed INR 22,270 crores wherein the Indian business consisted of INR 19,100 crores. The company has been rated A by AM Best Company in the direct insurance business consistently since 2007. Moreover, since 2014, it has been rated AAA by CRISIL which represents the company’s financial strength to honor its claims. The range of products offered by New India Assurance Company includes the following –

    1. Motor insurance 
    2. Health insurance 
    3. Travel insurance
    4. Personal accident insurance 
    5. Office insurance 
    6. Home insurance
    7. Rural insurance
    8. Marine insurance, etc.

United India Insurance Company Limited 

United India Insurance has been operating in the general insurance segment ever since the year 1938 when it was established. However, in the year 1972, the general insurance business was nationalized by the Government of India. Thereafter, different insurance companies operating in India at that time merged with United India Insurance and the company became a Government-owned general insurer. After nationalization, United India has grown progressively and currently has a customer base of more than 1 crore individuals. 

Whether it is designing retail insurance solutions or sophisticated insurance plans for large scale corporations, United India has been a leading name in the general insurance segment. The company has also stressed on insurance penetration in the rural region by promoting and implementing Government-sponsored health insurance schemes like Universal Health Insurance Programmed or Vijaya Raji Janani Kalyan Yojana among others.

Oriental Insurance Company Limited

The company was established in the year 1947 as a wholly-owned subsidiary of The Oriental Government Security Life Assurance Company Limited. Later on, the company became a subsidiary of the Life Insurance Corporation of India (LIC) in the year 1956 when LIC was established. Oriental Insurance remained a subsidiary of LIC till the year 1973 when the general insurance business was nationalized in India and the company’s stake was transferred to GIC (General Insurance Corporation of India). In the year 2003, GIC relinquished its ownership in Oriental Insurance transferring it to the Central Government. 

Today, the company is held only by the Indian Government and has its headquarters in New Delhi. The company sells different types of general insurance products and as per the year ending 2017-18, it has underwritten a premium amount of more than INR 11450 crores.

National Insurance Company Limited 

The oldest general insurance company is the National Insurance Company which was founded in the year 1906 in Kolkata. After its establishment, when the general insurance business was nationalized, National Insurance became a subsidiary of GIC (General Insurance Corporation of India). However, in the year 2002, the company became an independent general insurer held by the Government of India. 

Besides offering general insurance solutions in India, National Insurance also serves Nepal. The company has various awards under its belt like the Economic Times Iconic Brands Award 2018 in the general insurance category, SKOCH order of merit received in 2017 for being the best general insurer in 2017 to name a few. 

National Insurance offers a range of life insurance products meant for individuals, businesses, rural sectors and also farmers. The products of the company offer the best coverage benefits at the lowest premium rates.

Specialized Government insurance companies 

Besides life and general insurance companies, the Government of India also owns specialized insurance companies which include the following –

General Insurance Corporation of India 

The General Insurance Corporation of India, or GIC as it is popularly called, is the only Indian reinsurance company in the market. As a reinsurer, GIC insures the insurance policies underwritten by life and general insurance companies. GIC was formed in the year 1972 under Section 9(1) of the General Insurance Business (Nationalization) Act, 1972. The aim of forming GIC was to supervise, control and operate general insurance business in India. After nationalization of general insurance, GIC owned the above-mentioned general insurance companies as subsidiaries. However, in November 2000, the Act which created GIC was amended and GIC became a reinsurance company relinquishing its holding over the four public-sector general insurance companies.

Today, GIC is engaged in the reinsurance business in India as well as in international markets and is considered to be one of the best reinsurance companies.

Export Credit Guarantee Corporation of India

Another specialized insurance company, the Export Credit Guarantee Corporation of India, ECGC, deals in credit risk insurance policies for exports. The company, therefore, aims to promote exports by underwriting the associated risks. 

ECGC was formed in the year 1957 and was earlier called Export Credit Guarantee Corporation of India Limited. Today, the company’s administrative controls are in the hands of the Ministry of Commerce & Industry. Besides offering credit risk insurance policies to protect against export related losses, the company also serves banks and financial institutions. Indian companies which invest in international joint ventures also resort to overseas investment insurance policies offered by ECGC.

Agriculture Insurance Company of India Limited 

The Agriculture Insurance Company of India Limited, AIC, is a general insurance company which offers insurance solutions for agriculture related products. The company was established in 2002 but it commences operations in April 2003. 

By providing agriculture insurance to farmers, the company aims to boost agriculture productivity. When the farmers are assured of financial assistance in case of unforeseen losses, they are motivated to be more productive. This boosts agriculture which not only creates a source of revenue for farmers but also increases the country’s GDP.

So, these are the list of Government insurance companies. In the general insurance segment, three of the four public sector insurers, National Insurance, United India Insurance and Oriental Insurance are proposed to be merged into one. Mrs. Nirmala Sitharaman, in her debut Budget in July 2019, proposed the merger of these three companies into one unit. This merger would be completed in some time but today these companies are operating independently. You can, therefore, visit Turtlemint and buy general insurance policies from these companies currently till they are merged. 

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