Chennai: Merger of the four non-life insurers into one entity, the appointment of two consultants to suggest revamp measures for the four outfits and quick revision of wages are going to be the key points to be discussed at 21st general conference of the All India Insurance Employees'' Association''s (AIIEA) at Kanpur on 8-12 December, 2007.

Says J Gurumurthy, secretary, AIIEA, ''''There is no justification for the government to own four different companies - National Insurance Company Limited, New India Assurance Company Limited, Oriental Insurance Company Limited and United India Insurance Company Limited, carrying on the same business.''''

According to him 22 members of Parliament, cutting across party lines, have started writing to the prime minister and the finance minister in support of the merger.

Replying to one of the MPs, P Chidambaram, finance minister has stated that ''''the officer concerned, in the ministry is being asked to look into the matter for appropriate action. After having the matter examined, I shall send you a reply as early as possible'''', claims Gurumurthy.

He also found fault with the Insurance Regulatory and Development Authority (IRDA) for turning a blind eye on the unethical practices- paying more than the stipulated commission / brokerage to the insurance intermediaries, refusing to accept socially necessary risks- indulged by the private sector.

''''The misfeasance of the private insurers is common knowledge but the regulator is unaware of it,'''' he quips.

According to him, the IRDA has failed to develop effective monitoring and control over the insurers. The weaknesses in the regulatory system are compounded by inadequate enforcement since penalty levels are low.

Questioning the logic of New India Assurance, Oriental Insurance and United India hiring Boston Consulting Group at a fee of around Rs.15.50 crore each he poses, ''''How is that consultancy firm to advice all the three companies to become the top non-life insurer in the country at the same time?''''

Gurumurthy also wondered whether the three companies took into account the conflict of interests that would arise while hiring Boston Consulting Group.

On the justification for the demand of 40 per cent hike in wages at a time when the companies are not able to meet the cost norms he says, ''''The four companies posted heavy profits in 2006-07 registering an increase of over 103 per cent over the previous year, from Rs1583 crore to Rs3220 crore. The dividend pay out to the Government of India for the year ending March 2007 was Rs.582 crore as against the previous year figure of Rs266 crore, an increase of over 118 per cent.''''

According to him there is a massive increase in documentation with a depleted staff strength which reflected the increasing productivity of employees.

Further in order to retain the talent that is migrating to the private sector there is justification for the hike demanded, he adds.

Gurumurthy says, P Sainath, Ramon Magsaysay Award Winner for Journalism will inaugurate the conference and Subhashini Ali, president, All India Democratic Women''s Association will be the chairperson for the Reception Committee of the conference.