IAG and SBI to launch insurance company
Insurance Australia Group (IAG) and the State Bank of India (SBI) have signed a joint venture to establish a general insurance company in India, which will commence trading in 2009.
The managing director of IAG, Michael Wilkins, said the joint venture was a significant step in pursuing select international insurance opportunities for IAG.
“This provides us with an exciting opportunity to be a key participant in India’s rapidly growing general insurance market by leveraging the combined strengths of our two organisations. Entering the Indian general insurance market has been a priority for IAG for some time to support our longer term growth and profitability,” Wilkins said.
The venture will have exclusive access to SBI’s distribution network and brand, and will aim to build scale in the corporate, small to medium enterprise and retail segments. IAG will hold 26 per cent of the venture, with the option to increase its stake to 49 per cent in the future. It will have board representation, the right to appoint certain key management personnel, and affirmative voting rights over key business matters.
SBI chairman O.P Bhatt said the Indian general insurance industry is expected to grow at 15 to 20 per cent a year in the next decade, and the venture would diversify SBI’s portfolio of financial services.
The venture will be funded from IAG’s internal resources.
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