Money & Banking

It’s business as usual after Warburg Pincus’ 26% stake buy: IndiaFirst Life Insurance CEO

Surabhi Mumbai | Updated on February 13, 2019 Published on February 13, 2019

RM Vishakha, Managing Director and CEO, IndiaFirst Life Insurance. File Photo

Insurer’s focus will remain unchanged; upbeat about fresh distribution opportunities

Global private equity player Warburg Pincus has just concluded picking up a 26 per cent stake in IndiaFirst Life Insurance, but it is business as usual at the private sector insurer.

“I don’t think it will have a significant impact, especially since our Indian shareholders are continuing and committed. They are also our primary distributor and we get 90 per cent of our retail business from both the banks,” said RM Vishakha, Managing Director and CEO, IndiaFirst Life Insurance.

In an interaction with BusinessLine, Vishakha said she does not foresee a major impact on the style of management or areas of focus, although there could be a bit more involvement in terms of the financial liabilities of the company.

“From our company’s perspective, we have always been focussed on value creation,” she said.

Carmel Point Investments India Private Limited (CPIIPL), incorporated by Carmel Point Investment Ltd, which is owned by private equity funds managed by Warburg Pincus LLC, has bought over the 26 per cent stake in the private insurer from British financial services entity, Legal and General.

The deal, which was announced last year, was concluded earlier this month after regulatory approvals came in.

State-run lenders Bank of Baroda and Andhra Bank hold 44 per cent and 30 per cent stake, respectively, in the private sector insurer.

PSB merger

Meanwhile, Vishakha is also upbeat that the merger of Vijaya Bank, Dena Bank and Bank of Baroda will open up new distribution opportunities.

Focus areas

“One of our focus areas in the coming fiscal year will be the additional distribution because of the proposed merger.

“Our focus will be to extend the same quality of service and product capabilities to the merged entity,” she said.

Additionally, the insurer is looking to further expand its distribution channel after picking up a 9 per cent stake in CSC e-Governance Services India Ltd last month.

“Bancassurance will continue to be our key focus area, but along with it, we are setting up a very strong team to look at a whole range of distribution opportunities as the distribution landscape has changed significantly,” she said, adding that the segments of microinsurance and CSC are significant for the insurer.

The insurer is already selling a customised product called CSC Insurance Khata, and believes that the stake acquisition will give it much more insight into the customer segment.

IndiaFirst Life Insurance is also targeting a 20 per cent year-on-year growth in 2018-19. It registered a 118 per cent growth (year-on-year) in gross written premium in January, and a 65 per cent increase between April 2018 and January 2019.

Published on February 13, 2019
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