IRDAI issues guidelines on group health insurance policies of merged PSBs
Upon merger of these PSBs, the underlying group health Insurance policies of the customers of the merged banks will be continued to be serviced by the respective insurance companies which issued the policies till the end of policy period. The insurance companies will make suitable arrangements with the acquiring banks to this effect.
The insurance regulator IRDAI on Tuedsay has laid down the gidelines on the Group Health Insurance Policies issued by the Public Sector Banks (PSBs) which are gettimg merged.
Upon merger of these PSBs, the underlying group health Insurance policies of the customers of the merged banks will be continued to be serviced by the respective insurance companies which issued the policies till the end of policy period. The insurance companies will make suitable arrangements with the acquiring banks to this effect, said IRDAI.
A bank in its capacity as a group organizer may have group insurance arrangements with any number of insurance companies for the insurance needs of its customers.At the end of the current policy period of the group insurance policy of the merged bank, the acquiring bank at its option may continue with the same group insurance policy with the same insurance company, for the customers of the merged bank.
The acquiring bank may simultaneously continue to have insurance coverage for its existing customers with its existing insurance company. The acquiring bank can also offer this insurance coverage to the customers of the merged bank with the consent of its insurer.
The arrangements of the merged banks can be continued with the respective insurance companies for a period of twelve months from the date of merger, subject to willingness of the acquiring bank to function as the corporate agent for the respective insurance companies.
Earlier, Finance Minister Nirmala Sitharaman had announced a big consolidation of public sector banks: 10 public sector banks to be merged into four.
Under the scheme of amalgamation, Indian Bank will be merged with Allahabad Bank (anchor bank - Indian Bank); PNB, OBC and United Bank to be merged (PNB will be the anchor bank); Union Bank of India, Andhra Bank and Corporation Bank to be merged (anchor bank - Union Bank of India); and Canara Bank and Syndicate Bank to be merged (anchor bank - Canara Bank).
In place of 27 public sector banks in 2017, now there will be 12 public sector banks after the latest round of consolidation of PSU banks.
Before the merger of 10 PSBS, the The National Democratic Alliance (NDA) government led by Prime Minister Narendra Modi in its first innings(2014-19) had announced the merger of Bank of Baroda, Dena Bank and Vijaya Bank.