The government may have to invest 1,000 crore in two non-life insurance companies - Oriental Insurance and National Insurance - to make up for provisioning requirements towards third-party motor pool by March, said two people close to the development. Of the four state-owned general insurance companies, Oriental and National may face solvency constraints. The concern is that they will fall below the required solvency ratio of 1.10% at the end of 2012 after paying towards the loss-making segment. Both insurers have to provide 500 crore to 700 crore each, depending on their market share. "The government may have to infuse 1,000 crore in the two non-life insurance companies to protect the solvency margin requirements," said one of the persons. At the end of September, the solvency ratio of Oriental Insurance was 1.49%, while that of National was 1.36%.
Source: Economic Times
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