Tata AIG Insurance customers need not worry : P Chidambaram
If you have taken a insurance cover from Tata AIG Insurance, you do not have to worry. Existing stringent insurance laws will ensure long-term sustainability of your cover.
Tata AIG General Insurance Company Limited and TATA AIG Life Insurance, the troubled American International Group’s insurance joint ventures with the Tata Group, has enough financial capacity to meet its obligations to policyholders, though the American group’s financial woes would have a bearing on its Indian operations, finance minister P Chidambaram said.
”Life and general insurance companies promoted by Tata Sons and Tata AIG Life are registered under Indian Companies Act and are bound by the provisions of the Insurance Act and other Regulations. The accounts of these two companies as on 31 March 2008, indicate that both companies have satisfactory solvency margins which are adequate to meet liabilities,” IRDA said in a press release .
The American International Group has also issued a release, saying its commitments to AIG companies around the world will continue to be honoured.
IRDA, however, has expressed concern over the recent developments in the US financial markets. AIG, which is a leading insurance group of US, has sought financial support from the Federal Reserve. AIG is operating in both life and non-life insurance sectors in India, where the Tata Group owns 74 per cent stake each and AIG holds the rest 26 per cent. IRDA has asked for a report from both Tata AIG Life Insurance Company and Tata AIG General Insurance Company on the development regarding one of its promoters AIG in the US.
PSU and private general insurance companies have reinsurance business with AIG. Insurance companies are working the amount of exposure they have to AIG. Reinsurance business is treaty based. The treaty can be withdrawn if reinsurer cannot underwrite the risk. The US Federal Reserve has agreed to loan AIG USD 85 billion for two years.