LIC To Acquire Stake In Health Insurance Firm

Wed, 19 March 2025

08:24

State-owned Life Insurance Corporation of India is in advanced stages of negotiation to buy a 'substantial' stake in a standalone health insurer to broaden its footprint in that segment, the insurer informed the stock exchanges on Tuesday.

Earlier in the day, speaking at the sidelines of an event, LIC Managing Director and CEO Siddhartha Mohanty said the stake-purchase announcement was likely by the end of the current financial year while clarifying it will not be a majority stake.

No binding agreement has been entered into so far, the insurer said.

'The execution and ultimate consummation of the deal is subject to various factors, including approval of the board of directors of the Corporation, regulatory approvals and other approvals, if any, before executing any binding agreements. There can be no guarantee or assurance of the execution/ consummation of the potential deal,' the exchange notification said.

Mohanty did not disclose the name of the company in which LIC is looking to acquire a stake but clarified it would not be a majority stake.

"We have plans. Discussion is going on at the final stage. So, that is a natural choice for LIC to be in health insuranceSince regulatory approval takes time, I am very much hopeful that a decision can be taken within this financial (year), before March 31," Mohanty said on the sidelines of the Global Conference of Actuaries in Mumbai.

"It will not be a majority stake, which means LIC will not have 51 per cent stake," he said.

Currently, India has seven standalone health insurers -- Star Health & Allied Insurance, Niva Bupa Health Insurance, Care Health Insurance, Aditya Birla Health Insurance, ManipalCigna Health Insurance, and Narayana Health Insurance, and Galaxy Health Insurance.

Mohanty also said LIC had requested the Reserve Bank of India for additional long-term bonds, including a 100-year bond.

"We are long-term investors. We have contractual obligation to pay back in terms of contract. So, I have to do all these investments, asset liability management properlyWestern countries, they have long-term bonds." Mohanty said.

Earlier, the RBI had introduced 50-year bonds following demand from insurers and pension funds. The first 50-year bond issued in November 2023 saw robust demand from insurers with the RBI receiving 216 bids worth Rs 40,200 crore against the notified amount to raise Rs 10,000 crore through the 50-year paper.

Aathira Varier, Business Standard

TOP STORIES

30 Maoists, cop killed in 2 encounters in Chhattisgarh

In a fresh offensive against Naxals, security forces killed at least 30 members of the banned CPI-Maoists in two separate encounters in Chhattisgarh's Bastar region on Thursday, officials said.

25 Indians on death row in UAE, govt tells RS

The Indian government has informed Parliament that 25 Indian nationals have been sentenced to death in the UAE, but the judgments are yet to be implemented. The Ministry of External Affairs stated that 10,152 Indian prisoners, including...

X to be held responsible for content by AI tool Grok

The Indian government has said that social media platform X will be held responsible for content generated by its artificial intelligence tool Grok. This comes after users on X asked Grok questions about Indian politicians and the AI...

Will Sunita, Wilmore get overtime for longer space stay?

Astronauts Sunita Williams and Butch Wilmore, who returned to Earth after spending 286 days in space, will not receive any overtime for their extended stay, despite their spacecraft malfunctioning. NASA rules state astronauts are treated...

Grabbing of breast, breaking pyjami string not rape: HC

The order was passed by Justice Ram Manohar Narayan Mishra on a revision petition filed by two persons who moved the court, challenging the order of a Special Judge of Kasganj by which the court had summoned them under Section 376 of IPC...