Hailing higher foreign participation in the insurance sector as a “positive” step, Irdai Chairman T S Vijayan on Thursday said it will attract more capital and increase sectoral penetration in India.
“This is extremely positive step. I am sure more capital is going to come. More capital is required to increase the penetration of insurance in India,” Vijayan said on the sidelines of Health Insurance Conference organised by Ficci.
“Insurance companies are already in discussion… when they discuss raising stake from 26% to 49%, there is of course discussion on pricing. Once they conclude on the pricing front, it will help increase insurance penetration.”
Following relaxation in norms, some foreign players have recently increased their stake to 49% from 26% in their Indian joint ventures.
The prominent ones are Nippon in Reliance Life Insurance, AXA in Bharti AXA Life Insurance, Bupa in Max Bupa Health Insurance and Sunlife Financial Inc in Birla Sunlife.
On Irdai’s response to the recent floods in Chennai and other areas, he said data are being collected on a daily basis and companies have been asked to relax provisions as well.
“We are collecting every day the types of losses that have happened in Chennai and how much is settled. We have told the companies to relax some of the provisions (regarding claim settlement),” he said.
“We are daily monitoring how claims are settled. We are sure most of the claims will be settled in time.” Vijayan spoke of the need for increased awareness about health insurance in India and making it affordable.
Earlier, at the main event, Vijayan asked the industry players to increase their customer base and underlined the need for affordable premium.
The Irdai chairman also pitched for involving small and payment banks as well as cooperatives to help deepen the insurance penetration in the country.
Antony Jacob, CEO-Apollo Munich Health Insurance, said the industry needs to do a lot more to catch up in terms of increased communication.