IRDAI has given its first phase of licence to ITI Reinsurance, thus clearing the first ever Indian private sector reinsurance company in the country.
The IRDAI board in a meeting in Hyderabad approved the initial license – known as R1 in regulatory parlance – to ITI Reinsurance, promoted by a firm controlled by Sun Pharma co-promoter Sudhir Valia.
Four global players – Munich Re, Hannover from Germany, Swiss Re from Switzerland and French major SCOR – have also received R1 licences and they are awaiting final clearance from the regulator. Lloyd’s of London has also got the initial clearance from the IRDAI.
ITI Reinsurance is owned by Fortune Financial Services, in which Valia and others have a majority stake. PK Shah who had earlier worked in New India Assurance and Reliance Industries has been appointed as the MD & CEO of the company.
After providing the R1 clearance, the regulator now is conducting the due diligence for granting the final approvals (R2) to the global reinsurers to set up direct operations and the process may take some time.
GIC Re has been the country’s sole reinsurance company so far. “We don’t see any threat. There’s ample room for anyone – both domestic and foreign – in India. Growth is in this part of the world and we are an established reinsurer,” GIC Re chairman and MD Alice Vaidyan said on the imminent entry of several global reinsurance companies into India.