Page 6 - Insurance Times November 2020
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will offer affordable and seamless insur-  ucts to facilitate ecosystems and value  Note that ICICI Lombard is a general
         ance products to Finserv MARKETS   chains                             insurance company registered with the
         customers. Finserv MARKETS approach                                   Insurance Regulatory and Develop-
         is direct to customers which is aligned  CCI approves acquisition     ment Authority of India (IRDAI) and is
         with our approach. Given that auto                                    engaged in providing a comprehensive
         insurance is a core strength for Finserv  of general insurance busi-  and well-diversified range of general
         MARKETS, ACKO's product offerings ness of Bharti AXA by ICICI         insurance products, including motor,
         blend well with their current product  Lombard                        health, fire, personal accident, marine,
         suites, providing another best-value                                  engineering and liability insurance,
                                            The Competition Commission of India
         option to their customers. This part-                                 through multiple distribution channels.
                                            (CCI) has approved the acquisition of
         nership will further help us demon-
                                            General Insurance Business of Bharti  Meanwhile, Bharti AXA is a general
         strate distribution of insurance prod-                                insurance company registered with the
                                            AXA General Insurance Company Lim-
         ucts using data & technology as the key                               IRDAI and is a joint venture held by
                                            ited (Bharti AXA) by ICICI Lombard
                                            General Insurance Company Limited  Bharti General Ventures Private Lim-
                                            (ICICI Lombard) under Section 31(1) of  ited (51%) and Societe Beaujon (49%).
         TCS and B3i partner to             the Competition Act, 2002.         It is engaged in providing general in-
         launch solutions for insur-        Earlier in August, ICICI Lombard an-  surance products, including motor,
                                                                               health, travel, crop and home insur-
         ance industry                      nounced its merger with Bharti AXA's  ance to its customers.
                                            non-life insurance business. The com-
         Tata Consultancy Services has
                                            bined entity is set to emerge as the  Pursuant to the proposed combination,
         partnered with B3i Services AG, a glo-
                                            third-largest non-life insurer in India.  the entire general insurance business
         bal industry-led blockchain initiative,
                                            Post the proposed deal, ICICI Bank's  of Bharti AXA would be transferred by
         to design, develop and launch ecosys-
                                            shareholding will come down to 48.1%  way of a demerger to ICICI Lombard
         tem innovations based on distributed
                                            while Bharti & AXA will together hold  in consideration of issuance of shares
         ledger technology (DLT) for the insur-
                                            Rs. 7.3% stake in the merged entity.  by ICICI Lombard to Bharti AXA.
         ance industry.
                                            The exchange ratio for the same stands
         This partnership leverages TCS' innova-  at 2 shares of ICICI Lombard for every No deadline extension for
         tion capabilities and B3i's industry-lead-
                                            115 shares held by the shareholders of  motor insurance policies
         ing production DLT platform, to accel-
                                            Bharti AXA General Insurance business.
         erate the digitization of insurance for                               The Centre may have advised state
                                            ICICI Lombard believes that there is sig-
         faster and more efficient delivery of                                 governments to extend the validity of
                                            nificant headroom available for operat-
         tailored solutions to support risk man-                               all vehicle-related documents up to
                                            ing leverage and cost-effectiveness and
         agers, insurers, brokers, reinsurers,  that they do not require any capital  December 31, 2020.
         and industry service providers.
                                            raise at the moment given the solvency  According to a clarification from the
         Partners and customers will be able to  margins remain well above the regula-  General Insurance Council, the Minis-
         leverage the B3i Fluidity platform by  tory requirements.             try of Road Transport and Highways
         reusing common components and ser-  Also, Bharti AXA has a stronger pres-  (MoRTH) order does not apply to mo-
         vices, as well as ensuring         ence in motor insurance and hence,  tor insurance specifically.
         interoperability with other applica-  the combined entity will be able to  "MoRTH letter of 24th August 2020
         tions in the B3i ecosystem.        garner 12% market share in this seg-  advised State Governments that in case
         Additionally, TCS'  experience in  ment. CLSA has also maintained BUY  the validity of fitness certificates, per-
         curating ecosystems across industries,  with a target price of Rs 1560/ share.  mits, driving licences, and registration
         including manufacturing, distribution,  They add with a 120% combined ratio  certificates pertaining to vehicles have
         logistics, retail, and insurance will en-  & 7.9% share dilution deal will be earn-  expired on or after 1st February 2020
         able B3i participants to close the 'pro-  ings dilutive but the scale & synergy will  and not extended due to the lockdown,
         tection gap' by identifying opportuni-  ICICI Lombard to optimise expense ra-  such certificates may be treated as valid
         ties for new or existing insurance prod-  tio in future.              until December 31, 2020.

           6  The Insurance Times, November 2020
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