SEWA's insurance firm plan in limbo

The Self Employed Women's Association (SEWA) along with its wings Shri Mahila Sewa Sahakari Bank Ltd and insurance branch Vimo SEWA are planning to float their own insurance company.

However, the capital requirement fixed by the government to float an insurance company is proving to be a big hurdle for the institution and it is being forced to work as a mere agent between insurance companies such as LIC, ICICI Lombard, Bajaj Allianz and Om Kotak Mahindra.

The bank and Vimo SEWA's joint efforts have resulted into 1.5 lakh insurance policy holders and the number is increasing day by day.

The organisation has been trying to persuade the central government to bring down the capital requirement for floating a co-operative insurance company.

However, SEWA's efforts have not yielded any results. Talking to Business Standard, Jayshreeben Vyas, managing director, SEWA Bank said, "We want to float our own co-operative insurance company for our poor women clients. However, the capital requirement fixed by the government is Rs 100 crore which is too large for us."

"We really don't require so much capital as our policy covers will range from Rs 50,000 to Rs 1,00,000. As per our estimate, we only require Rs 40-45 crore. If the government treats our case as a special case and reduces the fixed capital requirement then we can manage the Rs 40 crore funds," he added.

Vyas said that the the organisation is trying to raise the funds required. "We may go for some collaboration at a later stage. But there is a problem as the companies ask us to give products for middle class as well. We can not cover middle class requirements," he added.