WestBridge Capital is joining forces with Neelesh Garg, outgoing managing director and CEO of Tata AIG General Insurance, to launch a new general insurance joint venture with a focus on AI-powered, digital-first services, two people aware of the development said.
This will mark the Bengaluru-based private equity firm’s second investment into the insurance sector following its successful part-exit from Star Health Insurance through its IPO in 2021.
WestBridge, which manages over $8 billion in investments in India, will hold a majority stake in the proposed venture, with Garg taking a 10% ownership position, people cited above said.
The venture will focus on the health and motor insurance spaces, where demand is surging, they added.
“The partnership is banking on digital innovations and AI-based processes,” one of the sources said. “By focusing on India’s uninsured population, the venture seeks to tap into a largely untapped market with significant growth potential, given the country’s current general insurance penetration of just 1%.”
Both WestBridge and Garg did not respond to requests for comment till press time Wednesday.
While Garg continues to be the CEO of Tata AIG General Insurance, he has resigned and his last day is in December.
With this JV, WestBridge and Garg will apply for a general insurance license, which will allow the company to operate across multiple lines of business, including health, motor, fire, and property insurance, people cited above said.
The entry into the market is well-timed, as IRDAI, the insurance regulator, has been actively promoting growth in the sector and encouraging fresh capital to enter to increase insurance coverage. IRDAI’s overarching goal is to achieve “Insurance for All by 2047,” and this push has led to an influx of new companies in recent years, with more than four new entrants joining the market in just the past year.
If regulatory approvals proceed smoothly, the new JV is expected to launch by mid-2025, the sources said.
The recent wave of new entrants into India’s insurance sector marks a shift after years of limited expansion. Until last year, the life insurance segment had not seen any new companies in over 12 years, and the general insurance sector had gone five years without new players. Now, however, several new companies are entering the market.
This will mark the Bengaluru-based private equity firm’s second investment into the insurance sector following its successful part-exit from Star Health Insurance through its IPO in 2021.
WestBridge, which manages over $8 billion in investments in India, will hold a majority stake in the proposed venture, with Garg taking a 10% ownership position, people cited above said.
The venture will focus on the health and motor insurance spaces, where demand is surging, they added.
“The partnership is banking on digital innovations and AI-based processes,” one of the sources said. “By focusing on India’s uninsured population, the venture seeks to tap into a largely untapped market with significant growth potential, given the country’s current general insurance penetration of just 1%.”
Both WestBridge and Garg did not respond to requests for comment till press time Wednesday.
While Garg continues to be the CEO of Tata AIG General Insurance, he has resigned and his last day is in December.
With this JV, WestBridge and Garg will apply for a general insurance license, which will allow the company to operate across multiple lines of business, including health, motor, fire, and property insurance, people cited above said.
The entry into the market is well-timed, as IRDAI, the insurance regulator, has been actively promoting growth in the sector and encouraging fresh capital to enter to increase insurance coverage. IRDAI’s overarching goal is to achieve “Insurance for All by 2047,” and this push has led to an influx of new companies in recent years, with more than four new entrants joining the market in just the past year.
If regulatory approvals proceed smoothly, the new JV is expected to launch by mid-2025, the sources said.
The recent wave of new entrants into India’s insurance sector marks a shift after years of limited expansion. Until last year, the life insurance segment had not seen any new companies in over 12 years, and the general insurance sector had gone five years without new players. Now, however, several new companies are entering the market.
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