PARLIAMENT

Insurance Industry Act regulations debated

Sandasen MARASINGHE and Irangika RANGE

Deputy Speaker Chandima Weerakkody presided when Parliament met at 1.00 pm yesterday. After the presentation of papers and oral questions, the House took up several regulations under the Regulations of the Insurance Industry Act, for debate.

International Monetary Co-operation Senior Minister Dr. Sarath Amunugama: The primary objectives of the Sri Lanka Insurance Board are supervising, regulating and managing the insurance industry in Sri Lanka.

According to these regulations, the administration fee charged from insurance companies have been increased from Rs. 250,000 upto Rs. 500,000. We can see a rapid development in the insurance industry with the development of the country's economy. As a result of the development of lifestyles and well-being of the people, the insurance sector in Sri Lanka has developed fast. According to reports released by the Insurance Board, the insurance industry in Sri Lanka has witnessed significant improvement in the last years. It is reported that there is a remarkable growth in both the long term insurance business and the general insurance business. There are 22 insurance companies registered in Sri Lanka. Sri Lankan insurance companies have achieved the highest ratings in the listings made by international agencies. The Sri Lanka Insurance Corporation is making profits now. The growth of the insurance sector is remarkable.

Lakshman Kiriella (UNP): The government has given a pledge to the United Nations that it is committed to implement the 17th Amendment. But the government has still failed to fulfill this pledge. Please do not mislead and cheat the people of this country.

It was stated that the Sri Lanka Insurance Corporation is earning profits. It is the one and only public sector institution which is earning profits. Parliament should have powers to order the relevant authorities to implement the recommendations made by the Auditor General to the COPE.

Human Resources Senior Minister DEW Gunasekera: The insurance sector has achieved a tremendous growth during the last year. The Insurance industry is developing rapidly in the world. The insurance industry has seen a boom in our economy after 1977. In the last year, around 20,400 road accidents had occurred killing a number of pedestrians, cyclists and motorists. There should be a new insurance policy to cater to the needs of victims of road accidents. We have noticed that most of the victims are very poor. Therefore, all 22 insurance companies should get together and formulate an insurance scheme for the benefit of the wounded, disabled, and people who have died due to road accidents, following a comprehensive study.

Anura Kumara Dissanayake (DNA): Pensions have not been paid to 91,000 farmers in the country from January this year. There are around 123,000 farmers across the country who are eligible to payments under the farmer pension scheme. But the Cabinet memorandum which was submitted by the government recently had suggested to do away with the Farmers' Pension Scheme. These innocent farmers have made their monthly contributions to the pension scheme. But they do not receive their pensions. This is a very glaring injustice. The government wastes huge amounts of money on various purposes, but it does not spend a cent to upgrade the livelihood of farmers.

Transport Deputy Minister Rohana Dissanayake: The Insurance industry is very pivotal for a country as it reflexes the development of a country. Unfortunately today only two percent of people have insurance coverage.

We have around 22 insurance institutes today. President Mahinda Rajapaksa as a sensitive leader went to meet the drought affected farmers and granted them relief. Insurance companies too, have to do the same. Insurance has become indispensable in developed countries. We have to reach that level. There is good competition among insurance companies. We have seen people who live by the insurance card in European countries. During the flood catastrophe in the country in 2011 some politicians attempted to gain petty political benefits.

Ajith Perera (UNP): We have no arguments on the regulations marked for today. But Minister Amunugama said that the insurance industry is a profitable field. It is earning excessive profits, that is the truth. The premiums they charge are not just. The issues in the insurance field should be dealt by Parliament. Most insurance companies pay benefits for third party insurance. They adopt measures to delay payments. One tragic situation is of a woman whose husband died in a motor cycle accident at the time her child was one year. It took 14 years for her to receive the insurance compensation. She received it after filing a case in courts, as the victim had a third party insurance coverage. I think the law should be amended to address these issues.

Dayasiri Jayasekera (UNP): The insurance coverage of the Ceylon Petroleum Corporation in 2009 was Rs. 92 million. It has been revealed that although the insurance institute from which insurance coverage had been obtained was based in the United Arab Emirates, there was no such institute there. In 2010 and 2011 also insurance coverage for the Petroleum Corporation was taken from the same institute which was not existing. I agree with the members who spoke on the issue of third party insurance policies. This government is at stake. You face a problem for being unable to collect revenue. So you impose high tax rates.

Arandika Fernando (UPFA): This government does not face any problems. It has focused on development. Anybody who is not blind could seen the welfare facilities provided by this government. Insurance should be made popular in the country. The opportunity for policy holders to get their benefits should be widened. This government has provided relief to insurance organisations and at times strengthened them when they were on the verge of collapse. I have to commend the insurance institution's service rendered at the time of the tsunami catastrophe.

Dr. Harsha de Silva (UNP): The government is planing to privatise the Sri Lanka Insurance corporation in the near future. This is the truth and no one can deny it. Can the Finance Minister assure that the Sri Lankan Insurance corporation would not be privatized? Lanka Hospitals would also be privatized since the majority of the shares of the hospital is owned by the Sri Lanka Insurance Corporation. The government should take measures to reintroduce the farmers' pension scheme for the benefit of the farmer community in Sri Lanka.

Eran Wickramaratne (UNP): Insurance policies should be introduced for the poor people who earn low income. Especially, the under privileged segments in the society should be covered by insurance policies. Even though there are public sector insurance companies no insurance scheme has been introduced so far for the low income earners.

Education Minister Bandula Gunawardene: The Insurance industry is growing rapidly in Sri Lanka as well as globally. There are 22 registered insurance companies in Sri Lanka. Twelve companies out of the 22 registered insurance companies are engaged in life and general insurance business while the balance seven insurance companies and three insurance companies are respectively engaged in general and life insurance business. In the future, it will be necessary that all insurance companies be listed in the share market.

If these companies are listed in the share market, anybody can purchase shares.

The House was adjourned until 1.30 p.m. today.

Govt never attempted to take political advantage of the Kolonnawa garbage issue - Minister Weerawansa

The government being a responsible one, never attempted to take mean political advantage of the Kolonnawa garbage dump issue by putting the Colombo Mayor who was elected from the UNP into trouble by urging people to stand against the CMC, said construction Engineering Services, Housing and Common Amenities Minister Wimal Weerawansa yesterday in Parliament.

The Minister further stated that as a far-sighted government with wide vision it took measures to settle the matter with the support of the Disaster Management Ministry, Urban Development Ministry the CMC and other relevant authorities without causing any inconveniences to the CMC or the public.

He made this observation in response to a question raised by UNP MP Sajith Premadasa querying as to why the government does not provide relief to the residents who were severely affected by the Kolonnawa garbage dump.

Construction, Engineering Services, Housing and Common Amenities Minister Wimal Weerawansa: We took measures and promised to provide them houses within the Colombo city limits within two years.

The Urban Development Ministry would provide these houses.

Till then we promised to provide each family a sum of Rs 10,000 monthly as house rent. We also agreed to provide a three month lump sum payment. But somebody who attempted to take mean political advantage had urged the people not to accept our offer.

Sujeewa Senasinghe (UNP): Point of order. It was I who went there.

Deputy Speaker Chandima Weerakkody: No that is not a point of order.