J&K Govt blacklists Reliance General Insurance for two years over contractual violations

Action follows probe findings, financial irregularities, and failure to meet obligations under Group Mediclaim Scheme

Jammu: The Government of Jammu and Kashmir has ordered the blacklisting and debarment of Reliance General Insurance Company Limited for a period of two years, citing serious contractual lapses, financial irregularities, and failure to fulfil obligations under a Group Mediclaim Insurance Scheme for government employees.

As per Government Order No. 16-FD of 2026 dated April 27, the decision follows a detailed examination of the company’s role in the implementation of the insurance scheme, which was initiated through a tripartite agreement signed on October 15, 2018 between the Government, Trinity Reinsurance Brokers Limited (insurance broker), and Reliance General Insurance Company Limited (insurer).

The Government had released substantial premium amounts—₹61.43 crore for approximately 3.5 lakh employees and ₹66.95 lakh for 1,506 pensioners—for the scheme’s implementation. However, soon after its launch, widespread concerns were raised regarding the finalisation and execution of the contract. Subsequently, the agreement was terminated with effect from December 31, 2018.

Investigations by the Anti-Corruption Bureau (ACB) revealed that claims worth ₹17.25 crore were settled, while a balance amount of ₹44.85 crore remained unutilized and recoverable from the insurer. Despite notices issued for recovery, the company instead raised counter claims against the Government.

The order further notes that the insurer failed to meet several key contractual obligations, including timely issuance of health cards, provision of empanelled hospital lists, development of a web-based platform and MIS system, establishment of district-level offices, and setting up dedicated helpline services for beneficiaries.

The matter was also investigated by the Central Bureau of Investigation and the Enforcement Directorate, which registered FIRs in connection with the case. Findings submitted before a special court indicated alleged conspiracy and financial misconduct, including diversion and laundering of funds related to the scheme.

Following these developments, the Finance Department issued a show cause notice to the company in May 2025. Although the company submitted its response, the Government found the explanation unsatisfactory and not addressing the serious lapses highlighted.

While arbitration proceedings between the Government and the company are ongoing, the Government clarified that such proceedings do not restrict its authority to take administrative action in the interest of transparency and integrity in public procurement.

Invoking its powers to safeguard public interest and maintain probity in governance, the Government has debarred the company from participating in any bidding or procurement processes in Jammu and Kashmir for two years.In compliance with directions of the arbitral tribunal, the order will come into effect after 15 days from the date of issuance, allowing the company to seek appropriate legal remedies, if any.