Kotak To Tie Up With Chubb
KMFL will enter the insurance sector either through a subsidairy or a joint venture. The last annual general meeting of KMFL has cleared Rs 10 crore for the new project.
Chubb is into general insurance and KMFL is likely to enter both the life and general insurance sectors.
Chubb is the fifth largest insurer in the US and the fifteenth largest insurer worldwide. The insurance company has also got top ratings from international rating agencies.
The senior debt rating of Chunn corporation has been graded AA+ by Standard and Poor's and Aa2 by Moody's.
For the property and casualty companies S&P has rated the calims paying ability of Chubb at AAA and Moody's has given a Aaa financial strength rating.
Profits from general insurance are immediate than in life insurance. The market is short-term unlike life insurance where policies have a long tenure.
The government is considering a proposal to privatise the Indian insurance market and several domestic companies are finalising their plans for entry into this sector.
As per the Malhotra committee recommendations, insurance companies in the private sector should have minimum Rs 100 crore as paid up capital.
Finance minister P Chidambaram in the last budget had mentioned the decision regarding the opening up of the insurance sector will be taken up at the next budget in February 1996.
It is reliably learnt that the Chubb Insurance and Kotak Mahindra will definitely strike the deal.
A formal announcement is expected to be made soon.