Cabinet decision to split SLIC challenged in Appeal Court
February 02, Colombo (LNW): Udayanga Rathna Diwakara, the General Secretary of Sri Lanka Insurance Corporation (SLIC), has initiated legal proceedings by filing a petition before the Court of Appeals on February 01, seeking a writ order to annul the Cabinet’s decision to bifurcate SLIC into two separate institutions.
A total of 56 individuals, including Prime Minister Dinesh Gunawardena, members of the Cabinet of Ministers, SLIC, and its Board of Directors, have been cited as respondents in the petition.
Such a decision, impacting the structure of SLIC, requires parliamentary approval and cannot be solely determined by the Cabinet, Diwakara argued.
He emphasised in the petition that SLIC, beyond being a profit-making institution, significantly contributes to public welfare.
He contended that the Cabinet’s decision lacks a legal foundation and raises concerns about the potential negative consequences on the public.
In addition to seeking an interim order against the Cabinet decision, Diwakara’s petition also requests the Court of Appeals to restrain SLIC’s Board of Directors from executing any actions leading to the division of the company’s assets and properties into two separate institutions.
The Cabinet of Ministers had approved the decision to operate the life and general insurance businesses of SLIC as distinct legal entities during its meeting on March 13, 2023.
This approval was granted in adherence to the provisions of the Regulation of Insurance Industry (Amendment) Act No. 3 of 2011 under the state-owned enterprises (SEOs) restructuring.
Subsequently, on December 18, the Cabinet endorsed a proposal by the President to segregate the life and general insurance businesses of SLIC into fully owned subsidiaries – Sri Lanka Insurance Corporation Life Limited and Sri Lanka Insurance Corporation General Limited.