Swiss Re, the world’s second-largest reinsurer, is in talks with New Delhi-based Religare Enterprises to form a joint venture to launch a
health insurance company in India, an executive of the Indian company said. Discussions for the venture are in advanced stages, said the executive, who requested anonymity.
The two companies plan to invest up to Rs 500 crore initially in the venture, another person close to the development said.However, both companies declined to comment. “We would not like to comment on this matter,” a Religare group spokesman said, when contacted.
While the shareholding pattern for the proposed joint venture is not known, under the existing norms, foreign partners are not allowed to hold more than 26% stake in Indian insurance ventures.
Swiss Re is among a number of global insurance companies looking to tap India’s health insurance market. It already has a presence in the industry through a 26% stake in TTK Healthcare Services, a health insurance third-party administrator.
Other international players in the segment include Munich Re Group entity DKV — a 26% stakeholder in Apollo DKV Insurance — and Oman-based ETA-Ascon Group, a partner in Star Health and Allied Insurance.
Health insurance is the fastest-growing segment in the non-life insurance business. Since 2001-02, Indian general insurers’ premium from health insurance products has grown five times from roughly Rs 700 crore to over Rs 3,000 crore in 2006-07, according to reports.
Recent estimates indicate that only 3-5% of India’s population of over one billion has access to health insurance. With healthcare costs in the country rising, it is felt that the demand for health insurance products will rise, especially among the country’s dominant middle class.
Source: Economic Times