IRDA sets up forum to promote health insurance

The members of the forum would include CEOs of health insurance companies, life insurers, third party administrators, officials from labour and health ministries and representatives of health service providers

New Delhi: Sectoral regulator Insurance Regulatory and Development Authority of India (IRDA) on Thursday set up a forum that would eventually become a self-regulatory organisation, in order to help promote health insurance, reports PTI.

The health insurance forum, IRDA said, would help in evolving policies and processes for the health insurance sector.

The members of the forum would include CEOs of health insurance companies, life insurers, third party administrators (TPAs), officials from labour and health ministries and representatives of health service providers.

The forum, IRDA said, will act as a consultative agency between insurance companies and other stakeholders.

It would also assist the IRDA in collecting data for efficient conduct of health insurance business in the country.

“It is the intention of the IRDA to extend the membership of the forum to cover all stakeholders relevant to the health insurance business and to enable this forum to evolve into a self regulatory organisation (SRO),” IRDA said.

IRDA said that the forum was necessary for effective dialogue between service providers (hospitals), the insurance companies, TPAs, and the consumers in general.

This forum would help form a consultative role in order to enable the evolution of a regulatory structure to take care of the growing needs of the sector.

The forum would meet at least twice a year and the members of would be in office for a period of two years.

Last year from 1st October IRDA had allowed portability of health insurance schemes, thereby allowing customers to change insurers without losing policy benefits.

Besides three standalone health insurers—Star Health & Allied Insurance, Apollo Munich and Max Bupa—a number of other players including National Insurance Company, United India and Oriental Insurance and ICICI Lombard are also active in this field.

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5 years ago

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5 years ago

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SEBI opens new window for promoters to dilute stake

SEBI on Thursday permitted promoters of top 100 companies to quickly dilute their shares through a separate window on the BSE and the NSE which has to be completed within a day. The norms, which follow the decision taken by SEBI board earlier this month, will help the companies in complying with the minimum public shareholding stipulation

Mumbai: Market regulator Securities and Exchange Board of India (SEBI) on Thursday permitted promoters of top 100 companies to quickly dilute their shares through a separate window on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) which has to be completed within a day, reports PTI.

The guidelines, SEBI said in a circular, “Will help promoters to dilute or offload their holding in listed companies in a transparent manner with wider participation.” 

The norms, which follow the decision taken by SEBI board earlier this month, will help the companies in complying with the minimum public shareholding stipulation.

The decision will also help the government to expeditiously offload its stake in public sector companies and raise funds for achieving the disinvestment target of Rs40,000 crore for the current fiscal.

All listed companies are required to have at least 25% public holding while in case of state-owned company the limit is 10%.

Under this window, the promoter will have to sell equity of minimum 1% subject to a minimum of Rs25 crore.

“However, in respect of companies, where 1% of the paid-up capital at closing price on the specified date is less than Rs25 crore, dilution would be at least 10% of the paid-up capital or such lesser percentage so as to achieve minimum public shareholding in a single tranche,” it said.

The duration of the offer for sale shall not exceed one trading day, it said, adding the placing of orders by trading members shall take place during trading hours.

As per the guideline, the promoters should not have purchased shares of the company during the 12 weeks period prior and after the offer of sale.

“All promoters or promoter group entities of top 100 companies based on average market capitalisation of the last completed quarter,” it said.

The seller may declare a floor price in the notice, it said, adding in case the seller chooses not to publicly disclose the floor price, the seller shall give the floor price in a sealed envelope to stock exchange before the opening of the offer.

The guideline said that minimum of 25% of the shares offered shall be reserved for mutual funds and insurance companies, subject to allocation methodology. Any unsubscribed portion thereof shall be available to the other bidders.

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SC finds no fault with PM, Chidambaram in 2G allocation

The two-member bench of the Supreme Court found that TRAI’s recommendations of 2007 on the policy of first-come first-serve basis was placed before the Telecom Commission in October but the four non- permanent members, including the finance secretary, were not even informed about the meeting

New Delhi: While the Supreme Court on Thursday came down heavily on former telecom minister A Raja, it has not found any fault on the part of prime minister Manmohan Singh or the then finance minister P Chidambaram or the ministry he headed, reports PTI.

The judgement has strongly indicted Mr Raja over the manner in which he manipulated the issue of licenses and ordered cancellation of the 122 second generation (2G) licenses in 22 circles.

The two-member bench of justices GS Singhvi and Ashok Ganguly found that the Telecom Regulatory Authority of India’s (TRAI) recommendations of 2007 on the policy of first-come first-serve basis was placed before the Telecom Commission (TC) in October but the four non- permanent members, including the finance secretary, were not even informed about the meeting.

A week later, Mr Raja accepted the recommendations of the TC and approved the TRAI’s recommendation but did not get in touch with the ministry of finance to discuss and finalise the spectrum pricing formula.

“However, as the minister of C &IT (Mr Raja) was very much conscious of the fact that the secretary, finance, had objected to the allocation of 2G spectrum at the rates fixed in 2001, he did not consult the finance minister (Mr Chidambaram) or the officers of the finance ministry,” the judgement said.

Mr Raja sent a letter in November 2007 to the prime minister saying the Department of Telecom (DoT) has decided to continue with the existing policy. He did not bother to consider the suggestion made by the prime minister that in view of the inadequate availability of spectrum fairness and transparency should be maintained in its allocation.

But within a few hours of the receipt of the letter from the prime minister, Mr Raja sent a reply in which he brushed aside the suggestion made by the prime minister of ensuring fairness and transparency by saying that it will be “unfair, discriminatory, arbitrary and capacious” to auction the spectrum to new applicants as it will not give them a level-playing field.

The finance secretary sent a letter in November 2007 to the telecom secretary and questioned how the rate of Rs1,600 crore determined in 2001 could be applied, without any indexation, to a licence to be given in 2008.

The finance secretary also emphasised that, in view of the financial implication, the finance ministry should have been consulted.

The telecom secretary promptly replied by sending a letter a week later in which he mentioned that as per the Cabinet decision of 2003, the DoT had been authorised to finalise the details of implementation of TRAI recommendations of 2007 that had not suggested any change in the entry fee/licence fee.

Mr Raja sent a letter to the prime minister in December 2007 that “DoT follows a policy of first-come first-serve for granting letter of intent to the applicants for Universal Access Service (UAS) licence. The same has been concurred by the Solicitor General of India during the discussions.”

The judgement referred to the arguments that the meeting of the full Commission, which was scheduled to be held on 9 January 2008 to consider important issues of performance of the telecom sector and pricing of spectrum, was postponed to 15th January.

The government had said that all the applicants including those who were not even eligible for UAS licence collected their Letters of Intent on 10 January 2008.

The 9th January meeting of the TC was deliberately postponed because the finance secretary had strongly objected in November to the charging of the entry fee fixed in 2001.

The court found that while making recommendations in August 2007 TRAI itself had recognised that spectrum was a scarce commodity and had suggested allocation of 2G spectrum on the basis of 2001 price by invoking the theory of level- playing field.

Its recommendations became a handle for Mr Raja and officers of DoT who virtually gifted away the “important national asset at throw away prices”, the court said.

The court also said the recommendations made by TRAI on 28 September 2007 were not placed before the full Commission which, among others, would have included the finance secretary.

“The notice of meeting of the Telecom Commission was not given to any of the non-permanent members..... In such matter, it was absolutely necessary for the DoT to take the opinion of the finance ministry,” the judgement said.

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