Prospectively, given the historical trends and the opportunity to hold greater ownership in the insurance companies, AM Best is of the opinion that the Indian insurance industry is likely to attract significant overseas capital inflow.
The possibility of higher foreign ownership would improve insurers’ financial flexibility by offering additional opportunities to bolster solvency. In addition, insurers would benefit from the sharing of risk management best practices, possibly leading to a lowering of exposure to high-risk assets and adoption of risk-based capital management, explained Mohammed Ali Riyazuddin Londe, vice President – senior analyst, Financial Institutions, Moody’s Investors Service.