ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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INDIA AND RUSSIA-Zhirinovsky s Friends

insurance, etc. The committee apparently believes that private and foreign firms will find the rural insurance equally lucrative. It has recommended that the new entrants into the life insurance field should write a specified proportion of their business in rural areas and that they should not avoid writing small policies. Also, the general insurance companies should maintain a balanced portfolio and should not, in particular, avoid writing motor insurance and covering rural non-traditional business. If the perspectives with which the private or foreign business enter the financial sector services including insurance are any guide, the new institutions will, without fail, concentrate more on lucrative business to the neglect of the small customer and the rural sector. In a society which offers poor social security facilities and with a vast informed business sector, the life as well as general insurance sector has to combine insurance of both niche activities as well as those serving the vulnerable sections of society. This in turn implies that there is no option but to go in for some degree of cross-subsidisation as between different types of insurance under the same individual organisations, It would be in the fitness of things if the government takes quick decisions on those sections of the Malhotra report which concern the revitalisation of existing institutions, their operational freedom and organisational responses to customer needs, including the appointment of an ombudsman for the insurance sector.

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