Magma HDI General Insurance launches OneHealth

Magma HDI General Insurance (Magma HDI), a joint venture between Magma Fincorp and HDI Global SE, Germany, launched its health insurance policy, OneHealth.

This product covers various medical conditions as well as lifestyle diseases which are covered rarely in the industry. The India State-Level Disease Burden Initiative’s Report released recently states that lifestyle diseases now kill more people than communicable ones like tuberculosis or diarrhoea in every state in India. Very few of the existing health insurance policies cover lifestyle ailments like Lasik, bariatric surgery, IVF treatment and in-patient psychiatric treatments among others.

Rajive Kumaraswami, MD & CEO, Magma HDI said, “According to studies, with increasing prevalence of lifestyle diseases in India, one out of four Indians is at risk of dying from non-communicable diseases. This policy along with covering all major lifestyle diseases will also offer additional benefits like restoration benefit, cumulative bonus, free annual health check-up.”

The product offers Rs 2 lakh to Rs 50 lakh, across only 4 variants. This can be taken for three years and there is a zone-wise premium calculation based on the location. Maternity is also covered under some variants of the product.

There is also an income benefit available that offers up to six months’ salary to the policyholder if they have any accident/injuries preventing them from reporting to work.



Date: 16th November,2017


Magma HDI General expects flat bottomlin this year

Mumbai, Nov 16 () Magma HDI General Insurance, which has completed five years of operations, is expecting profit to be in line with the previous year due to its growing portfolio.

“We had a robust growth in the first six months of this financial year. Going forward, we are expecting net profit to be in line with last year, which stood at Rs 6.3 crore, as our portfolio is growing,” Magma HDI managing director & chief executive Rajive Kumaraswami told reporters here today.

The combined ratio till September was 125 per cent and its accumulative losses were Rs 30 crore, he said. “We have all the top management in place. Now the challenge is to increase our portfolio and manage our expenses.”

He said gross written premium, which stood at Rs 423 crore in fiscal 2017, is likely to grow 30 per cent this year.

“The first six months has been robust for us. Going forward, we are expecting gross written premium to grow upwards of 30 per cent for the full year,” he added.

Kumaraswami said they are focused on retail segments like motor, critical illness and commercial. “In the next three-four years we see motors to be 65 per cent of our total business followed by health 20-25 per cent and commercial 15- 20 per cent.

Meanwhile, the company today launched a new healthcare prodcut called OneHealth, which covers various medical conditions including lifestyle diseases apart from offering restoration benefits, cumulative bonus, free annual health check-ups among others.

Magma HDI is a joint venture between Magma Fincorp and HDI Global of Germany, which is part of the Hannover-based Talanx Group–the third largest insurance group in the largest European economy. SM DSK BEN BEN


Source: Times Of India

Date: 16th November, 2017

HDI to exit JV with Magma after a five-year marriage

Mumbai: HDI, the German insurer which partnered with the MagmaBSE -0.06 % group for general insurance, has decided to exit the venture after nearly five years of partnership as their joint venture failed to grow on expected lines.

Magma HDI General Insurance, a joint venture between Magma Fincorp LtdBSE -0.06 %, Kolkata, and HDI Global SE, Germany, offers a wide range of products from health to travel to motor insurance.

“HDI is looking to exit the joint venture with Magma as the business in India has not grown as per their expectation,” said a source close to the development. “Magma HDI is less than 0.5 per cent of the market share and is growing at a slower pace than the industry. This has been a concern for HDI.”

The company had reported profit after tax of Rs 6.3 crore in 2016-17 as against a loss of Rs 11.9 crore in the previous year. The company had even moved its leadership team to Mumbai headquarters to attract talent. The company has a 0.32 per cent market share in the generalinsurance sector, which is dominated by the four public sector insurers andlarge private sector companies like ICICI Lombard, Bajaj Allianz and HDFC Ergo. Magma said it cannot comment as it is in a silent period while HDI said it does not respond to market rumours. In 2016-17, Magma HDI had reported a 3.85 per cent growth in gross written premium to Rs 419.29 crore, up from Rs 403.93 crore in the previous year.

Earlier this year, Fairfax had sold a substantial stake in ICICI Lombard to float another general insurance company. In 2015, Royal & Sun Alliance Insurance had exited a joint venture withSundaram FinanceBSE -0.40 % in this sector.

After the government raised foreign direct investment limit to 49 per cent from 26 per cent, several private equity investors and large corporates have shown interest in general insurance sector.
Star Health & Allied Insurance has seen interest from several existing and new investors to buyout the company, which is a market leader in standalone health insurance. Similarly, private equity investors including Warburg Pincus had bought stake in ICICI Lombard from Fairfax. Private equity fund True North, along with other funds, have expressed interest in buying into Religare Health Insurance. Narayan Murthy-promoted Catamaran has invested in Akko General Insurance, which received the final set of licence and will soon be starting business.

Source-The Economic Times


“Star Health Insurance promoters too head for the exit door”

Star Health Investments, which owns close to 40% of Star Health Insurance, seeks to cash out in the wake of a slew of insurance IPOs

Star Health Investments Pvt. Ltd, the promoter of Star Health and Allied Insurance Co. Ltd, is looking to exit India’s first and largest standalone health insurance firm, seeking to cash out in the wake of a slew of initial public offerings (IPOs) in the insurance sector, three people aware of the matter said.

Star Health Investments, which owns close to 40% of the insurance firm, joins other investors such as ICICI Venture Fund Management Co. Ltd and Sequoia Capital in trying to monetize their investment in Star Health Insurance.

The Economic Times first reported on 9 February that these shareholders wanted to exit.

On 4 August, Mint reported that Star Health Insurance was looking to raise up to Rs3,000 crore in funding through primary and secondary stake sales.

“As you are aware…these are natural processes in any growing company. I can only say that the company and its current management team will continue to serve the public,” said V. Jagannathan, chairman and managing director of Star Health Insurance. Jagannathan, also spokesperson for Star Health Investments, refused to elaborate further.

Shareholders of Star Health Investments include Sequoia Capital-owned Snowdrop Capital Pte Ltd. (43.71%) and a clutch of Chennai-based individuals, according to Registrar of Companies data.

Apart from Star Health Investments’s close to 40% stake in Star Health and Allied Insurance, ICICI Venture and Tata Capital Ltd hold close to 20% each. Apis Partners LLP, Alpha TC Holdings Pte. Ltd and others hold the rest.

ICICI Venture, Sequoia Capital, Tata Capital and Apis Partners declined to comment. Alpha TC and other shareholders did not respond to emails and calls seeking comment.

Two weeks ago, bankers sent an alert for a confidentiality agreement to existing domestic general insurers for exploring the option of a potential merger with Star Health Insurance recently, the three persons cited above said on condition of anonymity.

Kotak Mahindra Capital Co. Ltd has been appointed as the investment banker for shortlisting new promoters and public shareholders for Star Health Insurance. Kotak Mahindra did not respond to an email seeking comment.

“…considering the competition and the scope of penetration, capital infusion will be crucial for health insurers in the coming days for strengthening the network further and employing better technology to service customers’ needs,” said Shashwat Sharma, partner and head of insurance at KPMG India.

“So, along with strategic partners, having serious investors, too, will be important for health insurance firms,” he added.

Source: LiveMint

Date: 9th November, 2017

HDFC Life Parent Cos Look to Raise `8,700 cr by Sale of Stakes in IPO

HDFC, and its foreign partner Standard Life, plan to raise as much as `8,700 crore by selling their stakes in subsidiary HDFC Life Insurance Company , valuing the insurer at `58,000 crore.

The price band ranges from `275 to `290 per share. HDFC will sell 9.57% and Standard Life Mauritius Holding 5.43%. The offer will open for subscription on November 7 and will close on November 9. The company will list on November 17.

The offer is equivalent to 15% of the total post-paid equity share capital of the company . Investment banks, including Credit Suisse and Morgan Stanley , are working on the IPO. HDFC will raise `5,800 crore and Standard Life `2,900 crore at the top end of the price band, making it the biggest IPO in the life insurance sector.

Deepak Parekh, chairman, HDFC, said that the response of retail investors depends on the valuation and the disappointment has been because they did not make money as the pricing was not correct. “The growth in IPO index is 40%, when Sensex is up 20%,“ said Parekh. “It is an excellent time to enter the market.“

Source: Economic Times

Date: 31st October 2017

IPO WATCH – Long-term Investors may Look to Buy New India Assurance Shares Post List

NOT REASSURING In FY17, the insurer’s profit was `839.9 cr vs `913.9 cr in FY13, while peer ICICI Lombard’s profit grew to `641.8 cr from`352.8 cr during the same period

Assurance Company (NIAC), the country’s largest general insurance company, plans to hit the primary market to infuse capital and to enable the Government of India, the sole promoter, to sell part of its stake worth upto `7,680 crore.

NIAC’s price-book (PB) valuation is way cheaper but trailing priceearnings (PE) multiple is much higher than its listed peer, ICICI Lombard General Insurance Company (ILGIC). In addition, ILGIC has a more consistent net profit growth, lower combined ratio, and better return ratios. Given these factors, long-term investors may skip the IPO and consider buying NIAC’s shares if valuation falls subsequently after the listing considering its leadership position and strong domain expertise.


Incorporated in 1919, NIAC commanded 15% share of the country’s general insurance market with gross direct premium income (GDPI) of `19,115 crore in FY17. Its product portfolio covers crop, fire, health, and motor among others. The company had 2,452 offices and 68,389 individual insurance agents in India in June 2017. It also has overseas operations in 28 countries contributing 14.2% to total gross written premium (GWP) in FY17.


The company had a lower operating expense ratio of 20.4% compared with 30.1% for ILGIC in FY17.However, the combined ratio, which includes expense ratio and the claims incurred relative to earned premiums, was higher for NIAC at 110.7% compared with 102.4% for ILGIC in the June 2017 quarter. In addition, NIAC’s return on equity (RoE) was 6.8% compared with ILGIC’s 17.2% in FY17.

NIAC’s net profit has been volatile.In FY17, it was `839.9 crore compared with `913.9 crore in FY13. In contrast, ILGIC’s profit grew to `641.8 crore from 352.8 crore during the pe riod. NIAC reported net profit of `513.3 crore in the June 2017 quarter, which was more than half of the FY17 profit. While the growth is significant, consistency in the coming quarters will be crucial.


NIAC’s PB including fair value change account is 1.6 compared with 7.2 for ILGIC. However, NIAC’s PEmultiple based on FY17 earnings and post IPO equity is higher at 75.5 compared with 37.8 for ILGIC. NIAC’s lower RoE, higher combined ratio, and profit variation compared with ILGILC may prompt investors to avoid the IPO.

Source : The Economic Times

Date: 30-10-17

Bajaj Allianz General’s net profit rises by 11 pc at Rs 260 crore in second Qtr, underwriting profits at Rs 138 crore

Bajaj Allianz General Insurance reported 11% increase in its net profit at Rs 260 crore (Rs 234 crore in the year-ago quarter) in the second quarter  of the current fiscal.

The company also saw a surge in underwriting profits in the quarter at Rs 138 crore vis-à-vis Rs. 57 crore for the quarter year ago while the same stood at Rs. 150crore in H1 FY18vis-à-vis Rs. 29 crore in H1 FY 17.

Gross Written Premium(GWP) of the company increased by 31% during Q2 FY18 to Rs2,857 (Rs2,179 crore in Q2 FY17).

GWP increased by 30 % to Rs 4,830 crore in H1FY18 as against Rs 3,706 crore in H1 FY17. Net Profit increased by29% to Rs 473 crore in H1 FY 17-18.

The company  reported a healthy combined ratio of 88.8% in Q2 17-18 and 92% for H1 17-18, highlighting its sound underwriting and financial management practices.

The solvency ratio of the general stood at 288%, which is well above the normal regulatory requirement of 150%. The incurred loss ratio came down to 68.3% in FY 17-18 as against 72.0 % in the previous year due to better underwriting discipline and claims management. The company’s solvency ratio rose to 288 % compared to 253% in H1 16-17 signifying its sound claims paying ability.

Commenting on the results, Tapan Singhel, MD & CEO, Bajaj Allianz General Insurance Company  said, “Going forward, we will continue to focus on providing new innovative customer-centric products, high levels of customer service and grow in a sustainable and profitable manner.”



Source- The Economic Times.

Date:-17th Oct,2017-Tuesday