Axis Bank scouts for life insurance tie-up

Was not interested in entering the segment itself because of opportunities in core banking business

Private sector lender Axis Bank is planning to expand its business of distributing life insurance policies through a tie-up with one more insurer.

In the case of life insurance, the bank currently has a partnership with Max Life and LIC. Now, the rule allows an open architecture with up to three insurers. The private bank will at some point look at adding a third partner as well, its managing director and chief executive officer Shikha Sharma said at CII’s banking technology summit. 

She declined to give a timeline for a tie-up and added that the tie-up will not be influenced by geographical considerations.

The bank was not interested in entering the segment itself because of big opportunities in the core banking business.

As for general insurance space, the bank has an alliance with Tata AIG.  In healthcare insurance, where penetration is low, it has a tie-up with Apollo Health Insurance.

Referring to last week’s changes in rules to improve an NPA resolution, she said the move will “force” decisions by cutting layers.

There are layers of process (in resolution). The ordinance is cutting that layer off than having to go back to the board. It is forcing a decision mechanism because it is saying that if 60 per cent agree, rest have to fall in line, she said.

The government’s ordinance has been a “great boost” and the bankers were seeking similar measures for a long time.

The trouble with the Joint Lenders Forum is that decisions do not get taken for want of having an adequate ratio of bankers on board, or the boards do not approve decisions taken by the bankers, the Axis Bank CEO said.