In line with the United Progressive Alliance's agenda, Finance Minister P Chidambaram is expected to announce insurance schemes for specific interest groups, in addition to providing better health coverage, and a rainfall insurance scheme for farmers.
The government is, however, expected to stick to the present policy on health insurance. Under the present scheme, life and general insurance companies are allowed to provide health covers. There were demands to allow standalone health insurance companies with lower capital requirement, instead of the present norm of a minimum Rs 100 crore (Rs 1 billion) capital.
The government is also expected to wait before deciding on raising the foreign investment cap from the present level of 26 per cent. Officials said that none of the private companies were under any stress and the Indian promoters were also in a position to contribute the requisite capital to meet the solvency requirement as and when business grew.
"For the next few years, all companies look to be in a comfortable position and there is no immediate need to raise the cap," said an official.
The sources also said that most general insurance companies were now profit-making ventures and the Indian promoters too needed to earn the rewards on the capital that they had invested. Besides, the source pointed out that the Left parties, key allies in the UPA, may be unwilling to accept higher foreign investment ceilings.
Senior government officials said the comprehensive health insurance scheme, a group insurance plan, launched by the National Democratic Alliance government last year, had started off well but there were some deficiencies that needed to be improved upon.
The comprehensive plan made it possible to get health covers on payment of a nominal premium of Re 1 a day. The scheme has not been as successful as the Varishtha Pension Bima Yojna.
The officials said that the crop insurance scheme was for protection against unpredictable rainfall. A pilot project has already been undertaken in some districts in Andhra Pradesh and Uttar Pradesh.
A cattle insurance plan is also in the works, they said.
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