L&T group has decided to enter into the general business in next 6 months, the strategy of the group would be to go slow in the process.
“We have decided to enter into general insurance business considering the long-term potential of the business going forward,” L&T Chief Financial Officer Y M Deosthalee told reporters here.
In India there are already 20 players, including four public sector firms in general insurance business.
The company has no plans to partner with anybody at this point of time for its general insurance business which will take shape in next 6 months.
As per the existing guidelines, a foreign partner is allowed 26 per cent stake in non-life ventures. They, however, cannot set-up wholly-owned subsidiaries in India.
General insurance would be a separate entity and the money required for the venture essentially will be in the form of equity and that will be from the parent L&T, the engineering and construction major, Deosthalee said.
L&T, which has a significant presence in IT and finance, is expected to approach the Insurance Regulatory and Development Authority (IRDA) for approval.
The company is also venturing into the asset management business but this is still in the preliminary stage, he said.
(source:- business standard)
All big business houses want to venture into insurance. Some reasons which I feel are :-
1. Cost effective insurance coverage to their own projects.
2. Insurance business puts them upon a large pool of liquid cash (where inflow is many times more than outflow) and every big business needs lots of liquid cash to fund their working capital.
3. India is a fast growing economy and every financial activity which has an inherent risk is to be insured.
“Hi,
It’s good to see that many more companies are coming into the insurance sector. This will help customers to get best services with lesser premium. Here is an online tool which helps people to plan their insurance according to their needs & budget especially health insurance & retirement plan.
Please check this out at - http://www.simpleinsurance.co.in/“