Edelweiss arm gets non-life tag

Mumbai: Edelweiss General Insurance has become the 33rd non-life company in the country following a certificate of registration from the Insurance Regulatory and Development Authority of India ( IRDAI).
“We expect to invest around Rs 500 crore in the next 3-4 years. There is no foreign partner as of now,” said Rasesh Shah, founder, Edelweiss group. He added that the company will start operations in February 2017 and might look at having a foreign partner in future for strategic reasons.
With this, the group has interest in almost all major financial sector segments. Last year, the group had acquired JP Morgan’s asset management company. It had earlier established a non-life company in partnership with Japan’s Tokio Marine. The group’s Japanese partner will not be able to pick up a stake in the general insurance company as Tokio Marine is already present in India through a joint venture with fertilizer major IFFCO. According to IRDAI regulations, no prompter can have a strategic stake in more than one company in the same line of business.
The general insurance industry booked a total direct premium of Rs 1.28 lakh crore in India for the year 2016-17 as against Rs 96,379 crore in 2015-16, registering a growth rate of 32.94% as against 13.81% in the previous year.
Globally, the share of non-life insurance premium to total premium is around 45%. In India, however, life insurance plays a more dominant role and the share of non-life business to total premium is only 22%. According to insurers, this is because India is still a low-income country, and as per capita income increases and individuals assets such as vehicles and homes go up, the share of non-life will rise.