Page 8 - Insurance Times Janaury 2021

IRDAI News

IRDAI gives in principle in consideration of issuance of shares but still there are huge issues of under-
by ICICI Lombard to Bharti AXA. insurance," she said.
nod to ICICI Lombard to
Based on the share exchange ratio The regulator is now encouraging
buy Bharti AXA General recommended by independent valuers, states to share the details of uninsured
IRDAI has approved in-principle shareholders of Bharti AXA will receive vehicles so that reminders can be sent
acquisition of General Insurance two shares of ICICI Lombard for every to vehicle owners.
business of Bharti AXA General 115 shares of Bharti AXA. At present,
Insurance by ICICI Lombard General promoter ICICI Bank Ltd holds is IRDAI proposes a cap of
Insurance, the company said in a 51.89% stake in ICICI Lombard, while
statement. the rest is with the public. After the Rs. 1 crore in draft norms
proposed deal, promoter stake will
Earlier, Competition Commission of on standard accident
come down to 48.11%.
India (CCI), BSE Limited and National insurance policies
Stock Exchange of India Limited IRDAI not in favour of IRDAI has issued draft guidelines on
approved the proposed acquisition.
making insurance standard personal accident insurance
"Upon closing of the proposed policies and advised all general and
transaction, the consolidated entity mandatory standalone health insurers to offer this
will have a market share of 8.7% on IRDAI is of the opinion that insurance product from 1 April 2021.
proforma basis in the non-life business," cannot be made mandatory despite The product, which is proposed to be
ICICI Lombard said in a statement. The India being a massively under-insured offered on an individual basis, will have
proposed transaction is expected to country. a minimum sum insured of Rs. 2.5 lakh
result in value creation for all
"There has generally been a feedback and a maximum of Rs. 1 crore.
stakeholders through meaningful
that either the regulator (IRDAI) or the
revenue and operational synergies, it IRDAI proposed a payout equal to
government should mandate certain
added. 100% of the sum insured in case of
types of insurance, but ideally the
death or permanent total disablement
The policyholders should benefit from solution does not lie in mandating it,"
because of the accident.
an enhanced product suite and deeper said T L Alamelu, member (non-life)
customer connect touch points, said IRDAI. For permanent partial disablement,
India's largest private non-life insurer. "There is demand for mandating title the payout percentage will vary
according to the type of disablement.
Pursuant to the proposed combination, insurance, drone insurance, and
the entire general insurance business household insurance. The example For example, in case of the loss of an
of Bharti AXA would be transferred by before us is motor third-party entire foot or hand, the policy proposes
way of a demerger to ICICI Lombard insurance, which is mandated by law, a payout of 50% of the sum insured.

8 The Insurance Times, January 2021