Insurance licence Q getting longer

Insurance licence Q getting longer
ENS ECONOMIC BUREAU

AUG 26: The queue for a licence to enter the insurance sector is getting longer. Housing finance major HDFC along with the Standard Life group of the UK on Friday sought licence from the Insurance Regulatory and Development Authority (IRDA) for starting life insurance business in the country.

In all, four business groups have filed applications for the licence after IRDA started the process in the second week of this month.

While three applicants including Dabur, ICICI-Prudential and HDFC have sought permission for the life business, the Reliance group would be entering both the life and non-life businesses. Another unique feature of the Reliance forays into the insurance is that they are going all alone without any foreign partner.

The US-based New York Life Insurance Company and Max India will shortly file an application with the Insurance Regulatory and Development Authority (IRDA) for a licence to write life insurance business.

Shyam Sundar, head of marketing, Max India said that, "we are in the final stages of preparing the bid document and will be filing our application for a licence in the life insurance segment soon." As per the agreement between the two companies, Max India will hold an equity of Rs 74 crore in the Rs 100 crore joint venture company Max New York Life. The remaining equity of Rs 26 crore will be subscribed by the US company.

Sundar said that the joint venture proposed to procure the licence in the life insurance sector on the basis of the marketing plan, which was currently being prepared and the financial strengths of the two partners. He said that the New York Life was a Fortune 100 company, with a consolidated asset of $ 95 billion and $ 131 billion in assets under management. The company also has highest numbers of Indians in America as policy holders and agents. Max India, on the other hand, has business interests in diverse sectors like telecom services, electronic components, bulk pharmaceuticals and specialty plastics.