Cash-strapped Videocon Industries, which is fighting a bankruptcy case at the NCLT, today announced the exit from the general insurance business and sold its entire stake to the DP Jindal Group and Enam Securities for an undisclosed sum.
While the DP Jindal Group will hold 26 per cent, Enam Securities will hold 25 per cent in the new Liberty General Insurance Company, in which the foreign partner Liberty Mutual Insurance Group of the US will continue to hold 49 per cent.
The US insurer had increased its stake in the JV to 49 per cent last December from 26 per cent earlier. The company has received the necessary regulatory approvals for rebranding and will soon apply to change its name to Liberty General Insurance with the Register of Companies, company's chief executive, and whole-time director Roopam Asthana said.
In a statement, the Boston, Massachusetts based Liberty Mutual said, "with the new partnership, we will expand and fortify our position as one of the fastest growing general insurance companies in India with our capability to deliver high quality products and services across general insurance category. We are committed to the Indian market."
Commenting on the partnership, Matt Nickerson, president and chief operating officer for the Eastern Regions at Liberty Mutual said, "we are committed to growing its insurance joint venture in India to better serve the evolving insurance needs of consumers, and we believe that with the support of these two financially strong local promoters we will be able to even more rapidly serve our customers and distribution partners in India."
The company's paid-up capital stands at Rs 1,084 crore which is one of the highest paid-up capital for any general insurer in the country. It has registered 38 per cent growth in the December quarter without any exposure to crop insurance, making it one of the fastest growing general insurers.
Liberty commenced operations in 2013 and has an employee strength of 1,100 at 60 offices in 58 cities across 23 states. Its offers covers for health and personal accident, car and two-wheeler insurance, workmen compensation cover, liability, fire and engineering, marine and other miscellaneous products.
Asthana told PTI that the company is expecting over Rs 800 crore new business premium this fiscal year, which is a 40 per cent growth from the previous financial year when its business premium stood at Rs 600 crore. The company targets to grow two-three times over the market, which is growing at 17 per cent annually, he added. The company is also planning to enter three niche segments--mergers and acquisition, cyber and title. It sees a good business proposal in title segment after the implementation of Rera Act.
"We are ready with M&A segment and will launch a product next month. We are still working on the cyber and title segments and hope to launch a cyber product in a couple of months. Title segment will take more time and will try to have a product sometime next fiscal. We expect these three segments grow quickly," he added.
The company has a strong motor segment constituting 70 per cent of its total business and rest 30 per cent come mostly from health. "We expect to bring down the contribution of motor to 65 per cent and non-motor to 35 per cent going forward," he added.