Debasish Panda, chairman, IRDAI

The entities who have applied for the new licenses are Paytm General Insurance, Anzen General Insurance ( R1 filed in July), Ria General Insurance( R1 applied), Kshema General Insurance(Agriculture Insurance, R2 under process),Cosmea General Insurance (NOC issued),Kenko General Insurance( R1 issued),Go Mechanic General Insurance( R1 applied),Credit Access Life Insurance (R1 issued),Go Digit Life Insurance( R1 issued),Go Digit Reinsurance( R2 issued),Andhra Pradesh Government General Insurance( R1 under process)

Out of the 12 applications with IRDAI, eight are for general insurance companies including one agriculture insurer, three life insurers and one reinsurance company

It is believed that Debasish Panda, chairman, IRDAI, has told insures that India needed at least 100 players consisting of life ,general insurers and insurers whereas currently there are 70 players in the country

Mumbai/Chennai:

A total 12 applications for starting an insurance company-non-life/life/reinsurance are under various stages of processing at Insurance Regulatory and Development Authority of India (IRDAI).

Out of the 12 applications with IRDAI, eight are for starting a general insurance company including one for agriculture insurance, three for life insurance and one reinsurance company.

The entities who have applied for the licenses are Paytm General Insurance, Anzen General Insurance ( R1 filed in July), , Ria General Insurance( R1 applied), Kshema General Insurance(Agriculture Insurance, R2 under process),Cosmea General Insurance (NOC issued),Kenko General Insurance( R1 issued),Go Mechanic General Insurance( R1 applied),Credit Access Life Insurance (R1 issued),Go Digit Life Insurance( R1 issued),Go Digit Reinsurance( R2 issued),Andhra Pradesh Government General Insurance( R1 under process).

R1 is IRDAI giving the application form to a prospective insurance company promoter and R2 is the next stage of application form and R3 is the final stage of licensing where the company has to infuse capital.

This is also the first time a few insurance brokers have applied for licenses to to become full fledged player.

The applications of three or four companies like India Bulls (for life insurance), Paytm(General Insurance) and Kshema General Insurance(Agriculture) and Andhra Pradesh Government General Insurance, which is being advised by former chairman N Rangachary, have been pending with the IRDAI for the last three years.

It is not exactly known whether India Bulls is still interested to go ahead with the licensing processes as the company with its falling financial fortune has changed a lot of its diversification plans in the last 2 two years.

However, digital payments and financial services company Paytm which had dropped its two-year old plans to take over QBE Raheja General Insurance had said it will seek a new general insurance license with a fresh application, aimed at gaining majority shareholding with a 74 per cent upfront equity stake.

Also to attract more players into the industry, the IRDAI has decided to simplify the various approval processes.

“`The entire process where a prospective player is issued NOC (no objection certificate) so that it can apply for registration from the ROC(Registrar of Companies) has been automated and with guidance documents, we will hand- hold all new players to comply with various regulatory steps. We have cleared applications of 13 players in the last one and half months,’ Debasish Panda, chairman, IRDAI had said recently while addressing the CEOs of the insurance industry.

After taking over as chairman of the IRDAI in March, Panda has suggested a slew of measures including making rooms for smaller players like micro insurers, insurtech players and regional players with much lesser capital than Rs 100 crore, that is required to set up an insurance company and needs amendments in the insurance Act.

It is believed that Panda had told insures that India needed at least 100 players consisting of life ,general insurers and insurers whereas currently there are 70 players in the country.

However, though regulations mandates Rs 100 crore capital for a primary insurer and Rs 200 crore for setting up a reinsurance company in India, IRDAI as part of its due diligence is insisting on a much higher capital of Rs 800-1000 crore capital for a new insurer.

“It is to be seen how many players who have applied for licenses can infuse that kind of capital that will decide the final decision of the IRDA,” said industry observers.

Interestingly, Kamesh Goyal, and Prem Watsa (Founder and Chairman of FairFax Financial Holdings, Canada) the promoters of Go Digit General Insurance Company Ltd are venturing into the life and reinsurance segment.

Watsa recently had met Panda in New Delhi to discuss about his plans for setting up new insurance companies in India.

It is learnt Go Digit Life Insurance has been issued with R1 application form and Go Digit Reinsurance with R2 application form.

“Promoters of Go Digit General Insurance’s parent company, Prem Watsa’s Fairfax and Kamesh Goyal, plan to set up a reinsurance company in India. The application is subject to approval of the IRDAI .” said Go Digit.

The IRDAI is the licensing authority of insurance companies and processes the applications in stages –

With inputs from Agencies