Section 114: Insurer May Merge or be Amalgamated

1) Insurers engaged in the same type of insurance business may merge or be amalgamated with each other in accordance with the prevailing law with the approval of the Authority.

2) Before initiating the merger or amalgamation proceedings pursuant to sub-section (1), both the merging and the merging insurers shall submit a joint application to the Authority for approval along with the prescribed documents.

3) While investigating upon the application pursuant to sub-section (2), if it is observed as reasonable to merge or to be merged for the insurers, the Authority shall grant theoretical approval (approval in principle) to commence the process of merging.

4) After receiving in-principle approval pursuant to sub-section (3), the merging or merging insurers shall appoint a person qualified to be an auditor of the insurer to evaluate the assets, liabilities and business of their respective companies and have the valuation conducted as prescribed and submit an application to the Authority along with the details.

5) The Authority may grant approval for a merger (to merge or be merged) if it is observed that the merger is reasonable to the applicant insurers while investigating the application received pursuant to sub-section (4) and comprehending additional matters if it required so.

Provided that the Authority shall not provide approval to the insurers to merge or to be merged if there seems the possibility of causing detriment or loss to the insured, increasing unhealthy competition in the insurance business or establishment of monopoly or controlled commercial practice if insurers amalgamated together.

6) Other provisions relating to merging together (to merge or to be amalgamated) of insurers shall be as prescribed.