K.C. Mittal, member, Insurance Regulatory Authority (IRA), and former chairman of The Oriental Insurance Company, wants the number of private entrants restricted.
On the Malhotra Committee: It is a recommendatory study. Nothing is sacrosanct, there can be fluctuations. But it's an excellent piece of work and will help.
On allowing group companies to insure with their own insurance companies: No decisions have been taken yet. But personally, why shouldn't they insure with their own companies?
On the challenges before state-owned insurance companies: General Insurance Company has been trying its best to provide new products to keep up with the requirements. Maybe they haven't been innovative enough and have been unable to provide adequate service. To an extent that is due to the fact that our industry is tariff regulated. Only when they face competition from private companies and when the Tariff Regulatory Authority is made flexible will they succeed in meeting the increasing demands.
On a level playing field: From my side I can assure the state-owned companies that the law won't discriminate. But I can't speak for the Government.
On strict regulation of products and pricing:There are three different methods followed around the world. Germany required regulator approval for every product and price before introduction, but it was too stringent. In London they introduce and publicise a product, as long as it conforms to the guidelines and then regulator approval follows. SEBI also follows this method for public issues. In some countries no approval is needed. We might follow SEBI'S system.
On the potential of the insurance market: It's a small market with large potential. We can't allow too many players. The number of companies may be restricted.