Excelsior Correspondent
JAMMU, Apr 28: Jammu and Kashmir Government has blacklisted and debarred M/s Reliance General Insurance Company Limited (RGICL) for a period of two years, barring it from participating in any bidding or procurement processes in the Union Territory, citing serious contractual lapses and financial irregularities in the implementation of a Group Mediclaim Insurance Scheme.
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The action has been formalized through a Government order issued by the Finance Department (Insurance Section), after a detailed examination of the company’s role in the scheme launched in 2018 for Government employees and pensioners.
As per the order, the scheme was executed under a tripartite agreement signed on October 15, 2018, between the Government, M/s Trinity Reinsurance Brokers Limited (TRBL) as broker, and RGICL as insurer. The Government had released over Rs 61.43 crore as premium for about 3.5 lakh employees and Rs 66.95 lakh for 1,506 pensioners.
Soon after its rollout, the scheme triggered widespread concerns among employees and other stakeholders regarding its implementation, prompting the Government to terminate the agreement within a short period. The contract was formally discontinued with effect from December 31, 2018.
Subsequent investigations by the Anti-Corruption Bureau (ACB) found that claims worth Rs 17.25 crore were settled in favour of 3,344 beneficiaries, while a balance amount of Rs 44.85 crore remained as unutilized premium. The ACB recommended recovery of this amount from the insurer in accordance with the agreement.
The Government order highlights multiple failures on the part of RGICL in meeting its contractual obligations. These include failure to issue health insurance cards and enrollment kits, provision of empanelled hospital lists, non-establishment of district-level kiosks and coordination offices, and failure to provide a web-based platform, MIS system, and dedicated call centre services for beneficiaries.
The matter has also been investigated by the Central Bureau of Investigation (CBI) and the Enforcement Directorate (ED). In a complaint filed before a Special Court in Srinagar in June 2025, the ED alleged that the insurer, in alleged conspiracy with the broker, manipulated the process and diverted funds, causing losses to the Government and beneficiaries, and invoked provisions of the Prevention of Money Laundering Act (PMLA).
A show cause notice was issued to the company in May 2025, but its reply was found unsatisfactory. The Government observed that the pendency of arbitration proceedings does not prevent it from taking administrative action in the interest of transparency and accountability. Accordingly, the Government ordered the blacklisting of RGICL for two years to safeguard public interest and uphold integrity in procurement processes. The order will come into effect after 15 days, in line with directions of the Arbitral Tribunal, allowing the company to seek legal remedies.
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