2024 proved to be a transformative year for India’s insurance sector. The industry saw some of its biggest deals, with major acquisitions reshaping it. Traditional insurance giants ventured into new territories like health insurance, showing how established players are adapting to changing times. Foreign companies showed strong confidence in the Indian market, making significant investments across different insurance segments. From billion-dollar acquisitions to new players entering the market, the face of Indian insurance has changed significantly. This article explores these key shifts and movements that shaped the industry throughout the year.
Major Acquisitions
- The Hinduja Group secured IRDAI approval for its landmark ₹9,650 crore acquisition of Reliance Capital and its insurance subsidiaries in May 2024.
- The deal includes; Reliance General Insurance (wholly owned) and Reliance Nippon Life Insurance with a 51:49 JV with Nippon Life
- The acquisition is structured in two tranches: ₹3,000 crore already raised via NCDs, and a pending ₹4,300 crore tranche subject to DPIIT and RBI approvals.
Health Insurance Sector
- LIC is making a strategic entry into health insurance through advanced talks to acquire a 50% stake in ManipalCigna Health Insurance, valued at ₹3,500-4,000 crore. The deal, estimated at ₹1,750-2,000 crore, represents LIC’s first venture into the health insurance segment.
- Medi Assist TPA’s acquisition of Paramount Health Services for ₹312 crore is set to create a dominant player with 36.6% market share in the group segment and 23.6% in the health insurance industry.
General Insurance Developments
- Zurich Insurance’s acquisition of a 70% stake in Kotak Mahindra General Insurance for ₹5,560 crore marks the largest foreign investment in India’s general insurance sector since the FDI limit increased to 74%.
- The Competition Commission of India (CCI) approved Central Bank of India’s acquisition of significant stakes in Future Generali’s insurance businesses: 24.91% in General Insurance and 25.18% in Life Insurance.
Insurance Distribution Sector
- InsuranceDekho plans acquisition of RenewBuy in a share-swap deal which will result in combined entity valued at nearly ₹8,600 crore ($1 billion)
- SBI Life acquired a 10% stake in Bima Sugam India Federation for ₹6.6 crore, strengthening its market position.
Strategic Exits and Restructuring
- Allianz SE is considering exiting its two-decade-long joint ventures with Bajaj Group in both life and general insurance, where it holds 26% stakes.
- Canara Bank received RBI approval to reduce its stake in Canara HSBC Life Insurance from 51% to 36.5% through an IPO, following a mandate to decrease holdings to 30% by October 2029.
New Market Entrants and Expansions
- Narayana Health received the first health insurance license granted in five years, becoming the sixth dedicated health insurer in India.
- Lockton entered the Indian market by acquiring Arihant Insurance Broking Services.
- Aon completed its acquisition of Global Insurance Brokers (GIB). GIB will merge with Aon India Insurance Brokers after the National Company Law Tribunal’s merger process finalizes later this year.
- Samara Capital-backed Edme Services acquired 100% stake in Aditya Birla Insurance Brokers Ltd.
- Doha Insurance Group and Berkley Insurance Company are establishing presence in Gujarat International Financial Tec-City (GIFT City).
- African insurer Sanlam is expanding its Indian presence through a partnership with Shriram Capital Group for wealth management services.
Diversification
- PB Fintech (Policybazaar parent) entered healthcare through a new subsidiary, PB Healthcare Private Limited.
- Turtlemint is diversifying beyond insurance into mutual funds, loans, and claims assistance, with international expansion in UAE and Saudi Arabia.
- InCred is planning a ₹300 crore insurance venture focusing on health and motor insurance, alongside mutual fund offerings.
Corporate Rebranding
- Max Life rebranded to Axis Max Life Insurance following Axis Bank’s increased stake to 19.99%.
- General Insurance Brokers to adopt Aon branding post merger.
Implications of these Movements to the Industry
The wave of changes in India’s insurance sector during 2024 points to a more dynamic and competitive future. These major deals and partnerships have set the stage for better insurance products and services for Indian consumers. The entry of new players, both domestic and international, suggests we’ll see more innovative offerings and possibly better pricing across health, life, and general insurance segments.
What makes the future even more interesting is the government’s plans to increase foreign investment limits to 100%. This potential change could trigger another round of major moves in the market – we might see more international insurance giants entering India, new partnerships forming, and existing players reshaping their strategies.
