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MNYL is in talks with about 10 banks for possible equity tie-ups. "The insurance company could pick up stake in the bank or the bank in the insurance company or both could invest in each other or set up a subsidiary as special purpose vehicle," said Mr Singh.

Jaipur , Dec. 8

IN a bid to strengthen distribution, Max New York Life Insurance Company (MNYL) is tying up with two co-operative banks and will also enter into equity tie-ups with other banks.

Speaking to newspersons, Mr Anuroop Tony Singh, its Managing Director and CEO, said: "We had earlier wanted to tie up with about five co-operative banks. But with the regulator tightening norms for co-operative banks, we have been able to do so with only two." He was, however, not willing to divulge names of these banks stating that certain board approvals were pending.

Mr Singh said that a bancassurance deal with co-operative banks would enable the insurance company to directly target specific focus groups.

Also, MNYL is in talks with about 10 banks for possible equity tie-ups. "The insurance company could pick up stake in the bank or the bank in the insurance company or both could invest in each other or set up a subsidiary as SPV (special purpose vehicle)," said Mr Singh. Currently, New York Life has joint ventures with HSBC for the Argentina market and Allied Bank for the Philippines market.

Mr Singh also added that the capital base for bancassurance was not very high. In India, the agency route continues to dominate. Among the private players, 69 per cent of the policies are sold through the agency route, bancassurance accounts for 21 per cent while corporate agents account for 10 per cent. The life insurance company is also planning to increase its rural penetration by replicating its Punjab model. In the State, it sold policies through gram `sahayaks'.

Besides expanding its distribution, the insurance company was also planning to broaden its product portfolio by launching unit-link products, which Mr Singh claimed was for the mature customer. Currently, whole life and endowment policies dominate the company's portfolio.

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