AIG firms up plans for expansion in India

The US financial conglomerate, American International Group (AIG) will enter in to consumer finance, real estate and asset management business in the next six to eight months, reports Financial Express.

 

The company is planning to opt for a non banking finance route (NBFC) route for its consumer finance business, for which it has already got Foreign Investment Promotion Board (FIPB) approval and RBI approval is awaited. On the private equity front, the company is bullish on retail, IT, pharma, automotive spare parts and commodities.

 

Currently AIG has about $0.5 billion invested in India, AIG country head Sunil Mehta said. Meanwhile, Tata AIG Life Insurance has made a foray into micro insurance, the first private life company to enter into micro insurance, after the changes in the insurance regulations last year.

 

The company has launched three new products to its rural clients under the scheme. It aims to earn Rs 1 crore premium a month and targets to rope in atleast one lakh customers by end of one year through the micro insurance initiative. It has launched five micro insurance sales offices (MISO) across the country.

 

The company will be focusing on direct agents as channel of distribution. Currently, it has 450 agents. The micro insurance business would help to earn nearly Rs 600-800 a month per agent. The company has also tied up with 50 NGOs and grass-root organisations for its rural promotion. Further it plans to recruit 2,000 agents by next 8 to 12 months.

 

For the current year, rural business contributes nearly 23.5% of the total business and with this initiative; it is expected to grow further.

 

Commenting on the scope of growth in this segment, Mehta said, "Micro insurance should become fully integrated, micro finance and micro insurance should work in tandem. Moreover, private players should play an important role."