Insurers can now appoint professional promoters

Two former CEOs of insurance companies — Rajesh Relan (ex-CEO of PNB MetLife) and P Nandgopal (ex-CEO of both IndiaFirst) — are turning into health insurance entrepreneurs. IRDAI’s decision to permit private equity (PE) funding, as against strategic investors, in insurance sector has paved the way for professional promoters. IRDAI is expected to notify the final guidelines on PE in insurance soon. PE investors will be allowed to set up companies through a special purpose vehicle. However, there will be a 5 year lock-in before they can sell their shares. Relan proposes to set up a health insurance company with support from private investors. Nandgopal has also drawn up plans to launch Jiva Health and has put in a preliminary proposal with the insurance regulator, according to industry sources. While most of the insurance companies have corporates as promoters with strategic partners, in recent months there have been a few private companies with professionals as promoters. The recently licensed Digit General Insurance is led by Kamesh Goyal, former CEO of Bajaj Allianz, in India with Fairfax Group (former stakeholder in ICICI Lombard) as partner. Acko General Insurance is promoted by Varun Dua, who earlier led online insurance brokerage firm Coverfox.