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April 3, 2001
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Money > Reuters > Report April 3, 2001 |
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HDFC to foray into non-life insurance by 2002India's largest housing mortgage lender, Housing Development Finance Corp (HDFC), is talking to some foreign non-life insurance companies about forming a joint venture by year-end to offer property and casualty insurance, a top firm official said. "We see great synergy in entering the non-life (insurance) area and are looking at it," HDFC chairman Deepak Parekh told a news conference. "Sometime by the end of this year we should be looking at an entry." India's insurance market was opened up last year after the government passed legislation allowing foreign firms to own up to 26 per cent of an Indian venture. HDFC has already set up a life insurance venture, HDFC Standard Life Company Ltd, through a tie up with Europe's largest mutual life assurer, Standard Life. That company -- in which HDFC owns 82 per cent equity and Standard Life the rest -- began operating in December 2000 as one of the first private firms to sell life insurance in India, where insurance has long been the sole preserve of government-run bodies. Parekh said HDFC Standard Life was also planning to launch a clutch of pension products by July, aimed at catering to a pent-up demand for pension schemes in the Indian market. "We see a huge potential in the area of pension products, with the need for pension schemes increasing rapidly with the enhanced life expectancy, as well as a desire from professionals to be able to maintain their living standards after retirement." He said HDFC Standard Life hopes to write up to 25,000 life insurance policies by March 2002. That is just a quarter of the number of policies that ICICI Prudential, a joint venture between Indian financial services firm ICICI Ltd and British insurer Prudential Plc, has said it hopes to issue by next March. Parekh said the two partners had so far invested over Rs 1.6 billion ($34.32 million) in HDFC Standard Life and planned to invest another Rs 2-3 billion over the next three years. The life insurer was expected to break even in about four to five years time, he added.
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