Zurich Insurance Company Ltd, a major Swiss insurer, has received all necessary approvals to acquire a 70% stake in Kotak Mahindra General Insurance Company Ltd (KMGIC) from Kotak Mahindra Bank Ltd for Rs 15,560 crore (USD 670 million). This acquisition, combining fresh growth capital and share purchase, marks the largest foreign investment in India’s general insurance market and the first since the FDI limit was increased from 49% to 74% in 2021.
The combined entity will merge Zurich’s global expertise with Kotak’s local market knowledge to enhance trust, innovation, integrity, and customer service in the Indian insurance market. Zurich aims to contribute to India’s “Insurance for All” goal by 2047, anticipating significant market growth driven by increased consumer awareness, digital and financial infrastructure development, and a growing middle class. Tulsi Naidu, CEO-Asia Pacific of Zurich Insurance Group, emphasized that this acquisition positions Zurich as a leading player in India’s expanding insurance market.
Suresh Agarwal, Managing Director & CEO of Kotak Mahindra General Insurance, noted that the partnership will accelerate their mission of increasing insurance penetration in India by leveraging technology, scale, and global best practices.
Announced in November 2023, the deal required approvals from the Reserve Bank of India, the Insurance Regulatory and Development Authority of India, and the Competition Commission of India, all of which have now been obtained. Zurich, operating in over 200 countries and territories, is set to make a significant impact in India’s insurance sector, which had a gross written premium of Rs 3 lakh crore (USD 36.5 billion) in 2023.
Shares of Kotak Mahindra Bank rose 1.39% to Rs 1,743.50 on the BSE following the announcement.
Source: Fortune India