1.75 lakh employees of LIC (Life Insurance Corporation) and four General Insurance Companies namely, New India Assurance Company, National Insurance Company, Oriental Insurance Company and United India Insurance company, went on a one day strike on December 23 to protest against the introduction of two Bills (the Insurance Laws (Amendment) Bill, 2008 and the Life Insurance Corporation (Amendment) Bill) on December 22nd in Rajya Sabha. The strike in LIC was led by the All-India Insurance Employees Association and other unions. The strike was total. All the employees militantly participated in it and opposed the government’s anti-working class moves.

The Bills which the government introduced relate to increasing Foreign Direct Investment in Private Insurance Companies from the current 26% to 49% and disinvestment of shares of LIC and other public sector General Insurance companies.

At present there are 13 private sector insurance companies in the life insurance sector apart from the government controlled Life Insurance Corporation (LIC). These 13 companies include Tata-AIG, Birla-SunLife, HDFC-Standard Life, ICICI-Prudential, Reliance etc. As can be seen, the majority of these involve a partnership between an Indian company and a monopoly global multinational insurance company.  These Indian capitalists who have entered the Life Insurance sector in recent times have teamed up with monopoly global financial companies like AIG, Standard Barclays, etc., who are trying to secure a foothold in the huge Indian Life Insurance sector. However, so far, they have not been able to make a dent in the dominant hold of LIC over this sector, and many of the above private sector companies are yet to make the killing they hoped for. It is to open the doors for their expansion and profitability that they have been demanding the lowering of barriers to entry of FDI in the sector.

Simultaneously, the government has tabled the bill to disinvest its shares in LIC. Currently, LIC has a life fund of 6.5 lakh crores and further fixed assets of 10 lakh crores making a total of 16.5 lakh crores in assets. It is this huge asset pool that the big capitalists have in sight today when they are pressurising the Government to disinvest its shares in LIC.

A few days before the strike in Mumbai, a National Convention of Insurance Sector Employees was held in New Delhi on December 12, 2008, jointly organised by the All India Insurance Employees Association (AIIEA), Bank Employees Federation of India (BEFI), Confederation of Central Government Employees and Workers (CCGEW) and All India State Government Employees’ Federation (AISGEF), on the theme of “Global financial crisis and the need to protect banking, insurance sectors and pension funds”. Apart from opposing FDI hike in insurance, the Convention also opposed the Banking Regulations Amendment Bill and the Pension Fund Regulatory and Development Authority Bill (PFRDA).

The former seeks to increase the voting rights of private investors in public sector banks like SBI by diluting the government’s holding. The latter bill seeks to privatise government employees’ statutory pension system and make it contributory at the rate of 10% of pay every month, investing the money in the stock market through a private or any other financial institution.  The Convention also criticised and opposed the government’s decision to go ahead and invest a specified portion of the employees’ provident fund (EPF) in the stock market.

Workers in the Insurance sector are justly opposing the privatization of the insurance sector and increasing the space for monopoly private corporations. The question of insurance of the lives of the working people cannot be left in the hands of speculators and monopoly capitalists who have only profit as the goal. The experience of the ongoing global capitalist crisis in the US and Europe points out to the fact that with maximum profits as the goal driving the insurance sector, the very principle of assuring against risk is put in jeopardy; instead, the insured face high risks and uncertainty. The collapse of major financial companies like AIG in the US (which was rescued only by a huge federal government bailout) was a direct result of the fraudulent practices and unbridled speculation by these monopoly financial companies.

The protection and insurance of the lives of the most productive forces of society, the human labour force, is the responsibility of the society. It is with this perspective that the working class must fight the moves of the Government and the capitalists to privatize the insurance sector.