Page 36 - Insurance Times December 2021

with profit or loss figures and make public key developments. insurance third-party administrator in India; it will be an
Budget amendments to the LIC Act have been notified and offer of sale of up to 28,028,168 equity shares by the
the actuarial firm will work out the embedded value of the promoters and existing shareholders. Medi Assist
insurer very soon. A listing could value LIC at as much as Healthcare Services has filed preliminary papers with capital
$261 billion, based on its assets under management and markets regulator Securities and Exchange Board of India
using private sector insurers as a benchmark. That would (SEBI) for an initial public offering (IPO).
make it bigger than Reliance Industries Ltd., currently India's
largest listed company with a market value of about $199 Medi Assist IPO will be the first primary market sale by an
billion. The mega-IPO of the country's biggest insurer is insurance third-party administrator (TPA) in India. The IPO
expected to happen soon. will be an offer of sale of up to 28,028,168 equity shares by
the promoters and existing shareholders, including
The government, which owns 100% in LIC, will next Medimatter Health Management, Bessemer India Capital
determine the embedded value of the company to Holdings II, Bessemer Health Capital LLC and Investcorp
determine the stake sale details, including the amount and Private Equity Fund I. TPAs are appointed by insurance
price band. The LIC IPO is expected to meet the shortfall in companies for settlement of health policy claims.
that target. For LIC, the challenge lies in bringing efficiency
across the large agent network and also in maintaining its TPAs manage documentation and processing of claims for
market share. Mega IPO of India's biggest Insurer India the insurer to make the final settlement. The Bengaluru-
approved the sale of shares in state-run insurer Life based Medi Assist is the largest health benefits administrator
Insurance Corp. of India, a key step in moving ahead with in India, in terms of revenue and premium services.
the mega-listing. The administration plans to raise $24 Bessemer Ventures and Dr Vikram Jit Singh Chhatwal are
billion by selling assets including Air India Ltd. and Bharat the promoters of Medi Assist, with a stake of 45.51 per cent
Petroleum Corp. as it attempts to revive an economy that's and 31.63 per cent respectively. Investcorp holds a 21.65
been battered by the corona virus pandemic. per cent stake in the company. Medi Assist is the country's
largest third-party insurance administrator in terms of
Three new entrants revenue and premium serviced.
The needs of this emerging India are in many ways different.
The insurance sector, over the two decades since the It operates a pan-India network comprising over 11,000
introduction of competition and regulation, has matured hospitals across 722 cities and towns. Medi Assist has been
the most popular third-party administrator (TPA) for most
with 69 insurers today as against only eight in 2000. A
majority of these have crossed their initial breakeven phase. large hospital chains such as Apollo Hospitals, Manipal
Once the proposed listing of LIC happens, about 60 per cent Hospital, Fortis Healthcare, Narayana Hrudayalaya and Max
of the insurance industry business would be with listed Healthcare, among others. It's services are used by over
entities. The sector as a whole has been growing at a pace 11,000 hospitals across 722 cities and towns. Medi Assist's
significantly higher than that of the overall economy. IPO will be made up of only OFS of 2,539,092 shares.

Currently, there are four listed life insurers, and two in the
non-life segment. Three insurance sector companies are
entering the primary market with initial public offerings in
coming months to mop up over Rs 10,000 crore. These
companies are third-party administrator Medi Assist
Healthcare Service, PB Fintech, which runs the insurance
brokerage Policybazaar; and standalone health insurer Star
Health & Allied Insurance Company. They have already filed
their draft prospectus with markets regulator SEBI. These
are:

1. Medi Assist Healthcare

Medi Assist IPO will be the first primary market sale by an

36 The Insurance Times, December 2021