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Proposed amendments to insurance laws may lead to disputes in health claims, misappropriation: Unions

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 The proposed amendment to the definition of health insurance business is not exhaustive and may lead to disputes at the time of claims, said four unions in the Life Insurance Corporation of India (LIC).

The Unions also said the proposed amendments does not define the term liability which may lead to misappropriation by the insurers.

The four unions are: Federation of LIC of India Class I Officers’ Association, National Federation of Insurance Field Workers of India, All India Insurance Employees Association and All India LIC Employees Federation.

The Indian government has proposed drastic changes to the two insurance laws – Insurance Act 1938 and the Insurance Regulatory and Development Authority Act 1999- and has called for stakeholders views the planned changes.

Scrapping of the statutory Rs 100 crore startup capital for life and general insurance business and Rs 200 crore for reinsurance business, allowing different kinds of insurers including captives, changing the investment provisions are some of the major amendments proposed by the Indian government to the insurance laws.

The government also proposes to allow an insurer to distribute other financial products as specified by and subject to regulations and to services related or incidental to insurance business.

As per the proposed amendment to Section 2(6C) of the Insurance Act 1938 “health insurance business” means effecting contracts of insurance that provide sickness benefits or pay for medical and health expenses.

Quoting the existing definition in the Act, the four unions said the existing definition of health insurance business is explicit to include sickness, medical, surgical or hospital expense benefits.

However, the proposed amendment is not elaborative which may lead to dispute during a claim and the insurers may find scope to harass the customer. Therefore, the existing definition should not be replaced, the four unions said.

The employee unions are also opposed to the idea of insurers distributing insurers to distribute other financial products as it may distract the companies from their insurance products, distribution and proper attention on serving the policyholders.

Industry experts also told IANS that the policyholders funds should be ring fenced so that it is not touched by the players in the case of any liability that may arise due to selling other financial products.

The amendments to the laws are proposed in order to increase the penetration of insurance in the country, which continues to be low even after over two decades after opening up the sector.

The employee unions are also against the government’s plan to bring down the net owned funds to Rs.500 crore from the existing Rs 5,000 crore for a reinsurer.

Moreover, the minimum requirement of Rs 5,000 crore was enacted years back. Since then, huge inflation has taken place.

“Reduction in requirement by one tenth may result in insolvency which will put the customers in great sufferings. Therefore, we are of the opinion not to reduce the amount of net owned funds for new registration,” the unions said.

Referring to the proposed amendments to Section 27 of the Insurance Act, the unions said the proposed change does not define the liability, which may lead to misappropriation by the insurers.

Therefore, the liability must be defined in explicit terms.

On the proposed deletion of Section 27A of the Insurance Act the unions said: “This section deals with the provision of investments with a conservative view to safeguard the interests of the policy holders. Omission of this section may allow for irresponsible investments by the insurers causing huge harm to the customers.”

The unions are also against allowing multilevel marketing in the insurance sector.

Appointment of principal agent, chief agent and special agent to transact any insurance business will bring complexity in the system and will increase the probability of mis-selling as well as fraudulent acts, they said.

Business

Govt removes domicile certificate requirement for SC, OBC scholarships to ease access

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New Delhi, June 19: The Department of Social Justice & Empowerment has removed the requirement for a domicile certificate for students applying under Pre‑Matric and Post‑Matric scholarship schemes for Scheduled Caste and Other Backward Classes, an official statement said on Friday.

This step is expected to reduce the compliance burden on students and simplify the application process for scholarships, enabling easier access to benefits.

Thousands of eligible applicants across the country who study in institutions other than their domicile states will be benefitted, the statement from Ministry of Social Justice & Empowerment said.

Under the Pre-Matric and Post-Matric Scholarship Schemes for SCs and OBCs, nearly 1.2 crore students receive scholarship benefits annually. The removal of domicile certificate requirements will make the application process more student-friendly by reducing documentation requirements and lowering compliance costs.

Further strengthening digital governance, the Department has launched SETU (Scholarship for Educational Transformation and Upliftment) on the UMANG platform as a comprehensive solution for scholarship-related services.

The platform provides a single interface to the eligible applicants, Institutional Nodal Officers, District Nodal Officers and State officials for application registration, tracking, and validation of other services, improving transparency and efficiency.

“These initiatives are aligned with the government’s broader objective of promoting inclusion, reducing procedural barriers, and ensuring effective delivery of welfare schemes,” the statement noted.

The Department remains committed to leveraging technology-driven reforms to enhance outreach and provide timely support to students, it added.

A total of Rs 7,981.47 crore has been disbursed to over 75 lakh scheduled caste (SC) beneficiaries in FY26, an official statement said in April.

The funds were disbursed as part of schemes run by the Department of Social Justice and Empowerment focused on the educational empowerment of marginalised students belonging to Scheduled Castes.

Across key scholarship programs, expenditure rose year‑on‑year, with a 21 per cent increase under the Pre Matric Scholarship Scheme for SCs and Others, an 11.23 per cent increase under the Post Matric Scholarship Scheme for SCs, a rise of 13.5 per cent under Central Sector Scholarship of Top Class Education for SC students.

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Mukesh Ambani unveils 5-way roadmap to propel RIL’s growth ahead

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Mumbai, June 19: Reliance Industries Ltd (RIL) Chairman Mukesh Ambani on Friday outlined five major value creation pathways for the Group to create a diversified growth architecture spanning energy, materials, digital infrastructure, artificial intelligence, consumer businesses, and global exports.

Addressing Reliance shareholders, Ambani said: “First, the O2C business, the mainstay of Reliance so far, will increase earnings as soon as the geopolitical situation improves. Simultaneously, and more importantly, we are reinventing this business to create a new revenue stream less vulnerable to external volatility. We will convert all the crude oil we process into new materials ─ carbon fibre, speciality materials, green chemicals, and much more. This new vision will drive margin expansion and lay the foundation for our oil-to-chemicals-and-new materials business.”

He further stated that the second pathway comprises the new energy business, which has entered the phase of accelerated commissioning and early revenues. The integrated solar manufacturing and advanced battery platform will achieve one of the world’s lowest costs of RTC green power. It will also enable the world’s most competitive green hydrogen and green chemicals ecosystem.

Besides, the underground coal gasification business has immense growth potential, and the CBG business is ready to be scaled up as the world’s largest bioenergy business, he added.

Ambani identified the third path of growth as Reliance Intelligence, with AI becoming a multi-trillion-dollar business globally. “Reliance Intelligence will lead this business in India. The infrastructure for it is being built at breakneck speed, and it will fully operationalise over the next couple of years,” he remarked.

The Reliance Chairman listed the FMCG business as a new multi-billion-dollar growth engine with plans to grow it into India’s largest FMCG company, and among the biggest in the world.

“It is already among the top few players in various categories and is expanding globally. It recently entered Europe and Africa and will enter many more global markets going forward. Our FMCG growth path is neatly aligned to that of Reliance Retail. Both are anchored in our plan to create India’s most advanced manufacturing platform and a distribution and exports platform with tens of thousands of small, medium and large partners,” he maintained.

Ambani highlighted exports as the fifth path of the group’s growth. “Reliance has long been India’s largest merchandise exporter, with a proven globally competitive world-class platform for energy and materials exports. Leveraging this experience, Reliance aims to become an anchor institution for developing a globally competitive, multi-sector export hub, with a target to enable $125-150 billion in exports by 2032. In this way, we will enlarge global markets for Made in India brands,” he observed.

Hiring the best talent for this new venture has already begun. This scalable platform will strengthen India’s export ecosystem and external economic resilience. This ambition is not only about creating a larger Reliance. It is about creating a stronger India, Ambani added.

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Rs 65,000 crore worth coal gasification projects underway in India: Govt

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New Delhi, June 19: Coal gasification projects worth more than Rs 65,000 crore are currently under execution in India, signalling that the government’s push to convert coal into chemicals, fuels and industrial feedstock is moving from policy planning to on-ground implementation, according to a senior official.

Speaking at recently organised event, Coal Secretary Vikram Dev Dutt said the sector has witnessed an encouraging response from industry.

According to him, eight projects are already under implementation under the Rs 8,500-crore incentive scheme approved in January 2024.

The projects have received incentive support of Rs 6,233 crore and span sectors including coal-to-synthetic natural gas (SNG), ethanol, hydrogen, acetic acid, ammonium nitrate, DRI-based steel and sustainable aviation fuel.

The government is also finalising the request for proposal (RFP) under a larger Rs 37,500-crore incentive programme after placing the draft document in the public domain for stakeholder consultations.

Addressing the event, Union Coal Minister G. Kishan Reddy said Maharashtra has emerged as a key centre for coal gasification, with five projects already under development in the state.

He noted that Maharashtra benefits from coal availability through Western Coalfields Ltd, along with strong industrial infrastructure and policy support, positioning it as a potential hub for coal gasification projects.

Meanwhile, Maharashtra Chief Minister Devendra Fadnavis said the state is committed to creating an investment-friendly ecosystem for the sector and highlighted Mumbai’s historical association with coal gasification technology.

The government expects the coal gasification initiative to catalyse investments of around Rs 2.5-3 lakh crore across nearly 25 projects and aims to gasify 100 million tonnes of coal by 2030.

The programme forms part of India’s broader strategy to reduce import dependence in fertilisers, chemicals and fuels while strengthening domestic industrial capacity and energy security.

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