To form life insurance joint venture
Edelweiss Capital, an India-based financial services company has entered into an agreement with Tokio Marine Holdings, a Japan-based insurance group, to establish a life insurance joint venture in India to be called Edelweiss Tokio Life Insurance (ETLI).
Edelweiss would hold 74% of ETLI while Tokio Marine would own the balance 26%. Tokio Marine is keen to invest higher capital to the JV and increase their ownership to 49% when permitted by regulations.
The company said that the joint venture intends to approach the IRDA (Insurance Regulatory & Development Authority) to obtain the life insurance license. The proposed first phase capital of INR550 crores will be the initial paid up equity capital in the industry.
Rashesh Shah, chairman of Edelweiss Capital, said: “Life Insurance has played a pivotal role in channelising household savings into long term investments. The premium of over INR200,000 crores in the industry represents 12% of annual household savings and we believe this percentage will grow to 15% over the next 5 years. In Tokio Marine, we have found a partner who shares our vision for growth of the industry.”
Takashi Yoshikawa, CEO of Tokio Marine Asia Pte. Ltd, said: “Tokio Marine was the first Japanese insurance company to recognise this potential and set up a joint venture in the non-life insurance space. Edelweiss Capital with its history of innovation and deep knowledge of financial markets has all these and I am sure that our new joint venture, which combines the strengths of the two partners, will be a great success.”