Delhi-based mortgage firm DHFL to expand its footprint in insurance

MUMBAI: Dewan Housing Finance Corporation (DHFL), a Delhi-based mortgage firm focused on smaller cities, plans to expand its footprint in insurance with a licence to conduct general insurance business.

The nearly Rs 1 lakh-crore general insurance business has turned profitable for many companies, which have been given pricing flexibility by the regulator after they bled for several years.

DHFL is following the likes of Edelweiss and Kotak Mahindra Bank, which are seeing growth potential amid low penetration and improved profitability. While Edelweiss has filed for a R1 licence, Kotak Mahindra Bank has got its final approval and is all set to start operations. Kumar Mangalam Birla's Aditya Birla Financial Services has entered health insurance sector with South Africa-based MMI Holdings.

"We have learnt the ropes of general insurance business by being a distributor of general insurance products," said DHFL chairman Kapil Wadhawan. "We are in the process of applying for a licence to carry out general insurance business."

DHFL has been distributing products of Cholamandalam MS General Insurance through its branches.

Most of the new companies are going solo to begin with.The Insurance Amendment Act allowed foreign direct investment up to 49%. Under a general insurance business licence, the company will be allowed to underwrite all classes of general insurance business.