DLF forms JV for life insurance biz
Real estate giant DLF on Tuesday announced its tie-up with US-based financial player Prudential Financial, Inc (PFI) for a foray in life insurance business and said the two partners will invest about Rs 1,000 crore over the next ten years in the v...
By PTI |
NEW DELHI: Real estate giant DLF on Tuesday announced its tie-up with US-based financial player Prudential Financial, Inc (PFI) for a foray in life insurance business and said the two partners will invest about Rs 1,000 crore over the next ten years in the venture.
"Under the terms of agreement, Prudential will have 26 per cent stake and the remaining 74 per cent will be held by DLF Group in the JV -- DLF Pramerica Life Insurance Company Ltd (DLF Pramerica)," said Kapil Mehta, Chief Representative, India of Prudential Financial.
Pramerica is a brand name used in select countries by Prudential Financial, he said.
He said the company will initially have a paid up capital of Rs 100 crore, including Rs 26 crore by Prudential. The two partners plan to scale up investment to 250 million dollars (about Rs 1,000 crore) over the next 10 years, he said.
The company is applying for a licence from the Insurance Regulatory and Development Authority (IRDA), and hopes to start operations by early 2008.
Mehta, who has been earlier associated with MaxLife, said Prudential is in talks with several banks and non-banking finance companies (NBFCs) to distribute its insurance products, apart from having its own distribution products.
A DLF spokesperson said both the partners would have representatives on the Board, while Prudential would take care of the operations.
"With more than 130 years of experience in delivering insurance and financial products around the world, PFI is the perfect partner to work with us to establish a market-leading and highly differential life insurance business in India," DLF Vice Chairman Rajiv Singh said in a statement.
PFI has about 616 billion dollars of assets under management by December-end 2006 and operates in the US, Japan, Mexico as well as in many countries of Asia and Latin America.
Mehta said despite annual growth of over 25 per cent, Indian life insurance market has very high potential.
The Indian market is constrained by the capacity of players to introduce products as per the market requirements.
The new company, to be based in Delhi, would introduce innovative products to meet the specific needs of customers, Mehta said.
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