Money & Banking

Aegon Religare promoters to pump in Rs 400 cr

Roudra Bhattacharya Mumbai | Updated on March 08, 2011 Published on March 08, 2011

The promoters of Aegon Religare Life Insurance (ARLI) will infuse about Rs 400 crore in the company in the next financial year to support business growth.

Post capital infusion, ARLI's capital base will expand to Rs 1,350 crore from Rs 950 crore now.

“We expect capital infusion of Rs 350-400 crore to grow our business. A similar amount was invested in the current fiscal,” Mr Yateesh Srivastava, CMO, Aegon Religare Life told Business Line.

The three-year-old private insurer is also in talks with a number of banks including state-owned Punjab National Bank for a distribution tie-up, which could take up to six months to fructify.

At present, Aegon Religare sells 40 per cent of its policies through individual agents, a similar number through third party administrators and 15 per cent through the direct distribution channel. The remaining sales take place online.

Mr Srivastava also said that work on the Insurance Bill is now believed to have gathered speed post the Budget 2011-12 announcements last week. As part of the financial reforms agenda of the Government, the new Bill is expected to allow up to 49 per cent FDI in the sector, up from the present cap of 26 per cent.

With Dutch insurer Aegon looking to increase its 26 per cent stake in the tripartite joint venture (Religare has 44 per cent stake and Bennett Coleman has 30 per cent), the new bill will also make it easier for such private insurers to bring in fresh capital.

“The Insurance Bill is long overdue, but with work on the Banking Bill picking up, the belief is that the pace of reforms has quickened. The increase in the FDI cap will help companies where the Indian promoters are finding it tough to bring in capital. Also, it'll be easier for foreign companies to show their Indian business as part of their global balance sheet,” he said.

>roudra.b@thehindu.co.in

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Published on March 08, 2011
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