MUMBAI: The top-level structure of public sector insurance companies is set to undergo an overhaul with the selection process and interviews for filling up the nine posts of executive directors (EDs) in place of general managers and directors (GMDs) expected to be completed soon.
The ED structure for PSU insurers, which will be introduced for the first time, will be on the lines of PSU banks. Unlike a GMD who used to continue with the same salary which he or she was drawing as a general manger, an ED of PSU general insurance company will now receive a higher salary which will be finalised by the government.
The Appointments Committee of the Cabinet (ACC) finally approved the proposal of the Department of Financial Services (DFS) for framing of guidelines for appointment of EDs in PSU general insurance companies including GIC Re, New India Assurance (NIA), National Insurance Company (NIC), Oriental Insurance Company (OIC), United India Insurance Company (UII) and Agriculture Insurance Company (AIC) who are members of the GIPSA, the official coordinating agency for all these six companies, said a notification by the ACC.
PSU insurance companies will have two posts of EDs each. Currently, nine posts of EDs — two each in GIC Re, OIC, NIC, AIC and one in UII — have to be filled up after completing all official exercises. The government had appointed 10 GMDs in the PSU general insurance companies in November 2022 before switching over to the ED structure.
While the proposal to convert the post of GMD into ED was initiated years ago, the government notified the resolution only recently after the ACC’s approval. Going by the new appointment framework for EDs, all general managers of PSU non-life insurance companies, who have served for a minimum service of one year and have a residual service of at least one year on the date of vacancy of the ED post, are eligible to be considered for appointment as ED in such companies, the government notification said. The minimum service and residual service requirement may be relaxed with the approval of the Finance Minister, if sufficient candidates are not available in the zone of consideration, the notification said.
According to sources, all future posts of chairman and managing director (CMD) in the PSU general insurance industry will be filled up by promoting officials who will become EDs and unlike earlier occasions, GMs will not be eligible for the CMD interviews.
The Financial Services Institutions Bureau (FSIB), which selects top officials of PSU banks and insurance companies, will also select the EDs. The recommendation of FSIB will be valid for a period of up to one year or as per orders issued by the Government of India, and maybe extended with the approval the ACC, the notification said.
The government has roped in consultant Deloitte Touche Tohmatsu India for the preliminary scientific evaluation of eligible officials for the posts of nine executive directors in the PSU general insurance industry before they are interviewed by its headhunting agency FSIB.
At the end of the programme, Deloitte will give some grades to each of the officials which will be taken into account for the selection by the FSIB at the time of final interview.
FSIB has already shortlisted some GMs, who were promoted in 2022-23 (FY23) and also in FY24, though they have not completed one year as GMs. Seven GMs from New India Assurance (NIA), the largest non-life company in the country, have received letters from FSIB for getting their consents.
The DFS has also shortlisted five general managers (GMs) from different PSU insurers to fill up the two forthcoming vacancies of CMDs at Chennai-based United India Insurance and New India Assurance, the largest multinational general insurer in the country. The five GMs are – BS Rahul, Agriculture Insurance Company (AIC), Sunita Gupta, Oriental insurance Company (OIC), Hitesh Joshi along with two of his other colleagues V Balkrishna and his spouse Jayshree Bala from GIC Re.
Source: The Indian Express
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