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Manish Basu

Kolkata, Sept. 19 Tata AIG Life, a 74:26 joint venture between Tata Sons and AIG, is confident of going ahead with its expansion plans this year, according to a top official of the company. The confidence is believed to have been boosted by the news of $85-billion revolving credit being extended by the Federal Reserve to the American International Group (AIG) to pull it out of a crisis.

“In the next 12-18 months, we would add 100 offices to our existing 400 offices across the country,” the official told Business Line on condition of anonymity.

The company also proposed to raise its employee strength to 9,000 over the same period, from the current 8,500, he said. “We remain committed to our expansion plans, notwithstanding market speculations,” he said.

The management at Tata AIG Life, it was pointed, reposed full faith in the foreign partner’s commitment on capital infusion in the joint venture company in future.

“We are well capitalised and fresh infusion of funds for the proposed expansions will not be a problem,” the official said. He, however, declined to comment on the amount of investments required for its expansions plans.

“The solvency margin of Tata AIG Life is currently 304 per cent, and that of Tata AIG General Insurance is 176 per cent, while IRDA’s stipulation is 150 per cent,” he said, adding that the solvency requirements would be maintained after the proposed investments.

Incidentally, IRDA had pointed out in a statement on Tuesday that both Tata AIG Life and Tata AIG General Insurance have the ability to settle claims, going by their solvency margins as on March 2008.

With regard to Federal Reserve’s announcement that it expects the loan to be paid off by AIG from the cash raised by the sale of some of its global assets, the official told this newspaper, “With the insurance sector in India growing at 60-70 per cent, it is one of the fastest-growing emerging markets globally and therefore, India would continue to be a significant focus of AIG’s business.”

Currently, the assets under management of Tata AIG Life amount to Rs 4,000 crore and its capital base is at Rs 1,230 crore, he said.

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