Allahabad Bank consortium forms non-life joint venture company Universal Sompo General Insurance Company

Allahabad Bank has announced that the Bank, Indian Overseas Bank, Karnataka Bank Ltd, Dabur and Sompo Japan Insurance Inc have executed the Shareholders Agreement for the formation of a new non-life joint venture insurance Company. Subject to necessary regulatory approvals in this regard, the proposed Company shall be called Universal Sompo General Insurance Company. The proposed shareholding pattern of the Company shall be the Bank - 30%, Indian Overseas Bank - 19%, Karnataka Bank Ltd -15%, Dabur Investment Corporation - 10% and Sompo Japan Insurance Inc - 26%. The proposed entity will now make an application to the Insurance Regulatory Development Authority for the regulator's approval.

Shri. Vinod Rai, Secretary (Financial Sector) Ministry of Finance, Govt. of India, was present on this occasion alongwith Shri. A C Mahajan, Chairman & Mg. Director, of the Bank, Sh. T S Narayanasami, CMD, Indian Overseas Bank, Sh. Ananthakrishna, Chairman & CEO of Karnataka Bank Ltd., Sh. Mohit Burman, Partner, Dabur Investment Corpn,, Mr. Keishiro Kinoshita, Managing Executive Officer, Sompo Japan Insurance Inc.

The proposed Company intends to leverage the Indian Consortium's pan-India reach and distribution and the brand value of the consortium members. The proposed Company will also leverage the strong product and underwriting skill that Sompo has developed in the Japanese market as also its unique experience with respect to de-tariffing in the Japanese Markets.

The Bank has a strong branch network in the northern and eastern region of India while Indian Overseas Bank and Karnataka Bank Ltd have a strong presence in Southern and Western India. These three banks have a delivery channel of around 4000 branches across the country. Dabur is one of the most respected Corporate Houses in the country. Therefore, the Indian Consortium has a pan-India distribution network, high degree of credibility and reach across the country. Apart from distribution, the non-life insurance business provided the Banks an excellent opportunity to cross-sell insurance products alongwith the traditional banking products. Sompo Japan insurance Inc. is one of the largest Non-Life Insurance Companies in Japan and the Indian JV will be able to leverage its products and underwriting expertise.

This is going to be the first venture of Public Sector Banks in the Non-Life Insurance sector in India.

Source : Equity Bulls

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