IDBI, Federal Bank & Fortis to establish life insurance co

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IDBI, Federal Bank and Fortis announced today that they have signed a Joint Venture Agreement to establish a new life insurance company, which will offer a full range of life insurance and long-term savings products to the Indian market.

 

Under the Agreement, IDBI will own 48% equity; Federal Bank 26% and Fortis Insurance International will own 26% of the company, which is the maximum allowable shareholding for a foreign insurer under the Foreign Direct Investments regulations in India.

 

The joint venture agreement follows the signing of a Memorandum of Understanding (MoU) on July 11, 2006.

 

Subject to regulatory approvals, the three partners expect the new company to be operational by around mid-2007.  The company will promote a full range of life insurance and long-term savings products, including traditional and unit-linked savings plans, protection, health and disability covers; these will be available on an individual and group basis.  The joint venture will build a multi-distribution platform including bancassurance, agency and direct sales. In view of Fortis' global experience in bancassurance and the strengths of the bank partners, the company will use bancassurance as a key distribution strategy.

 

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