RIL accounts for 30% of NIC's income

National Insurance Company (NIC) has bagged 30 per cent of insurance premium income from Reliance factories.

Announcing this at a joint press conference called by Jammu & Kashmir Bank and National Insurance in Kolkata, chairman and managing director, H S Wadhwa, said that National Insurance had booked Rs 45 crore premium income for insuring the Reliance plants at Hazira, Patalganga and Jamnagar.

NIC expected a total premium income of Rs 200 crore from the group, which would be around 40 per cent of the total insurance premium of Rs 500 crore that Reliance shells out to various non-life insurance companies for its plants.

"Initially NIC used to receive a very small portion of the total premium income from Reliance. This year has been different," Wadhwa explained.

Wadhwa said J&K Bank and NIC had started discussions on a possible tie-up between the two institutions for bancassurance in the future.

The alliance could could well happen, he said when asked on the matter.

The NIC chairman said that its proposal for a second voluntary retirement scheme (VRS) was likely to be passed by the company's board in a week following. NIC expected about 1,829 employees to accept the offer out of a total of 16,073 eligible employees in Class I, III and IV.

The scheme would cost the company around Rs 113 crore. When asked about the means of financing the scheme, Wadhwa said NIC was cash rich and comfortably placed to finance it with its reserves.

Under the proposed VRS package, employees below 40 years of age would not be eligible. It was expected that the maximum outgo would be from the age range of 55 years to 60 years.

The scheme will offer 60 days of salary for each year of service completed or salary for the remaining period of residual service. Employees would get the lower of the two amounts. There was no ceiling on the quantum of compensation a person could receive under the scheme.