new delhi, Nov. 17 -- The Centre is weighing a massive restructuring of National Insurance Co., Oriental Insurance Co., and United India Insurance Co., potentially involving a merger, privatization or both. The Union finance ministry is discussing various options for the future of the three weak general insurers, two people aware of the development said. These include merging two of them with the listed and profitable New India Assurance; merging all three insurers; and merging only two insurers and preparing the third for privatization. "The Centre is seeking a structure that aligns with the policy to limit the number of state-owned companies in non-strategic sectors to one or two, while retaining a minimum of four in strategic sectors," one of the two people said on the condition of anonymity. General insurance falls under the non-strategic category. The discussions are at an early stage, and any decision will follow a deeper study of each insurer's solvency profile, integration challenges, and the fiscal implications of further capital support, the people cited above added. Queries emailed to the finance ministry and the four insurers went unanswered. The talks to strengthen India's state-owned insurers mark the revival of a seven-year-old plan. The 2018 plan to merge and subsequently list the three general insurers failed as they battled heavy losses and low solvency margins, leading to repeated capital injections by the government. Despite weak solvency ratios and dependence on regulatory forbearance, all three reported profits in at least some quarters of FY25, bringing the consolidation plan back on the agenda. "This time, the conversation is more pragmatic," the second person mentioned above said. "The focus is on what is feasible, what strengthens the sector, and what limits future fiscal exposure." Talks to consolidate insurance firms are unfolding alongside similar efforts to reshape India's public banking sector. "It is the government's stated policy to have bare minimum presence of PSUs in the strategic sector, with the remaining to be privatized or merged, or subsidiarized with other central public sector enterprises, or closed," said C.R. Vijayan, former secretary general of the General Insurance Council, adding it is "very natural" that the government attempts merger or privatization in the sector. Consolidation began with banking, and the same would be rolled out for insurance firms, Vijayan said. "How it is done would be decided by the government. But it will be done now." Others pointed out that with the insurance sector now fully open to FDI, public sector insurers must urgently prepare for a far more competitive marketplace. The move is set to reshape the market: more global players are expected to enter or expand, bringing capital, technology and product innovation that will pressure public sector insurers to modernise, improve efficiency and strengthen customer service....