ING Insurance International set to exit Indian insurance business

ING Insurance International, the Dutch major, is all set to exit the Indian insurance market.The company holds 26% stake in ING Vysya Life Insurance Company. “ING is definitely looking at exiting; it’s just a matter of time. They are at the moment concentrating on selling the rest of Asia business. Once that’s taken care of, ING will exit from India too,” five sources familiar with the development separately said.

An ING Vysya spokesperson refused to comment saying “it is business as usual at ING”.

One reason for putting the India exit on the backburner is that some issues are left to be ironed out.

For instance, ING Vysya Bank is seeking a bancassurance partnership for distributing insurance products even after the exit of the foreign partner.

“The bank wants to negotiate this with the foreign partners who are lined up for the stake sale ,” said an industry source, requesting anonymity.

“Even Exide wants to exit. And this will lead to greater trouble as they will have to seek both a domestic partner and a foreign partner or go for a merger,” this person said.

Battery major Exide Industries is the largest shareholder in the company with 50% stake.

An Exide spokesperson refused to comment, and another company source said an exit is not being contemplated.

ING has decided to sell off its insurance and asset management business by 2013 as part of a global restructuring plan.

The move will help the company to pay back $7 billion that it received from European Union in 2008. During that financial crisis, the company received $14.6 billion through a bailout plan.
According to Insurance Regulatory Development Authority data, ING Life collected premium of Rs48.79 crore for January this year. In February and March, the mop-ups were Rs62.55 crore and Rs116.96 crore, respectively. The ‘tax-saving’ month, indeed, provided a lot of cheer.

But like all life insurers, business went over a cliff with the start of the new fiscal in April and the premium collection stood at Rs14.09 crore. A major chunk of the business came from individual single and non-single premium collections.

 

By Nupur Anand & Aswathy Varughese
http://www.dnaindia.com/money/report_ing-set-to-exit-indian-insurance-business_1706262