Sri Lanka Insurance Company (SLIC), controlled by powerful businessman Harry Jayawardena, has not been granted approval to split into two entities – life and general, pending the upcoming Supreme Court case against privatising SLIC, according to sources close to the Insurance Board of Sri Lanka (IBSL).

A source said the company had applied in May to divide entities (thereby retaining SLIC as a holding company) as Sri Lanka Life Insurance and Lanka General Insurance, but IBSL did approve the application. "Whilst a court case is ongoing, IBSL cannot split SLIC into two companies," he said.

"If the split happened and SLIC's privatisation was revoked, Jayewardena would have had to hand over SLIC (the holding company), which by then would be only a shell firm. This will be advantageous to SLIC," he said. "With the judgement due any moment now, they (SLIC) are preparing for relevant contingencies," he added. .