"This is in line with GIC's overall agenda of staying away from the day-to-day operations of the subsidiaries,'' sources said, adding that the subsidiaries can make a business decision on the basis of market situation. The GIC subsidiaries can now open or close subsidiaries with the approval of their respective boards. Currently, the four subsidiaries together have 80 regional offices, 1,202 divisional offices and 2,926 branch offices all over the country. Earlier, GIC had issued a detailed circular, kickstarting a major restructuring exercise in the general insurance industry, by delegating the power of recruiting officers to its four subsidiaries.

GIC had allowed the subsidiariesto decide on their own the need-based requirement in the officers cadre as well, subject to approval of their respective boards. GIC's main operation, which is still being debated in the ministry of finance, will focus on reinsurance and investment and specialised functions including health insurance and overseas operation. While giving freedom to recruit officers, GIC had directed that the subsidiaries were required to follow the existing guidelines on recruitment to contain costs.

The recruitment should be for `core staff' only, that too for dire necessity, GIC had said. It further said that no recruitment to fill up the vacancies arising out of retirement or resignations be made. Before considering any recruitment, possible deployment from surplus centres to deficit centres is to be explored first. As far as possible recruitment will be restricted only for mofussil centres where deficit is unlikely to be made good by transfers from any other centre. GIC has stopped recruiting class I officers at theentry level during the last six-seven years and had initiated a `mass move' to promote 8,000 clerks to officers' cadre. However, the decision could not be implemented swiftly as the Chennai high court had stayed the order as certain group of employees of United India had pleaded against it in the court. Currently, selective need-based recruitment in specialist cadres like engineers has, however, been permitted. There has been a steady reduction of the number of officials from 15,294 to 14,983 during 1997-98. GIC has also delegated the powers to make compassionate appointments for supervisory, clerical and subordinate staff, relaxation in deserving cases the minimum eligibility period of five years for granting study leave for officers, granting extraordinary leave for officers and development officers.