Ergo in talks with L&T for insurance biz

NEW DELHI: German insurance major Ergo is looking to enter India’s growing insurance business. The company is in talks with L&T Finance for a possible 26:74 joint venture in life insurance. Ergo, part of the Munich Re group, is also in talks with others in India for a separate alliance for general insurance.

“Discussions with L&T took place to understand their interest to venture into the insurance arena. Venturing into the non-life and life insurance sectors with the same partner has some potential for synergies. But it can be overall more beneficial to venture with two separate partners, depending on the respective value proposition of the individual partners,” said an Ergo spokesperson. According to industry buzz, Ergo is also holding negotiations with Indiabulls for its life insurance business. Ergo is talking to financial services major HDFC for its general insurance foray. “Ergo is, as many other foreign insurance companies planning to enter the Indian market, in regular discussions with a number of potential Indian companies,” the spokesperson added, refusing to disclose the names of the players Ergo is talking to. Several business groups like the Hindujas are planning to enter insurance through joint ventures with foreign insurers. Hindujas were earlier said to be in talks with a European insurer for its planned life insurance foray. A leading European insurer, Ergo has a premium income of almost $22 billion and is No. 2 in the German primary insurance market, with $133 billion investments. The group, which operates in 24 countries outside Germany, has 28,310 employees. Besides India, China is the other market which is high on the company’s priority list. Ergo intends to have a strong presence in both India and China by establishing new corporations and expects high returns in the property, casualty and life business segments. Following the 110% growth in the life insurance business in India in 2006-07, there has been a rise in interest in the Indian market. Similar growth rates have been witnessed by the general insurance segment, forcing International insurers to look at launching operations in India.
Source: Times News Network