The Hindu : Birla Sun Life to augment capital

Online edition of India's National Newspaper
Wednesday, Feb 27, 2002

Business

Business

Birla Sun Life to augment capital

By Our Special Correspondent

CHENNAI FEB. 26. Birla Sun Life Insurance Company, a joint venture between the Aditya Birla group and Sun Life Financial of Canada, will soon see induction of fresh capital into the company.

The company has a capital base of Rs. 120 crores at the moment. There will be an additional induction of equity to the tune of Rs. 30 crores. The fresh infusion, according to Nani Javeri, Chief Executive Officer of the company, will be in place within the next few months.

Addressing a press conference here today to formally launch the Chennai branch, Mr. Javeri said the additional equity would take care of the stringent solvency margin stipulation prescribed by the Insurance Regulatory and Development Authority (IRDA).

According to an estimate, south India accounts for 31 per cent of the total life insurance policies sold in the country. Tamil Nadu's share in the southern cake is around 30 per cent. Chennai accounts for 22 per cent of Tamil Nadu insurance market.

The group financial director, S. K. Mitra, said in a country where insurance penetration level at an abysmally low, there was enough elbowroom for all new players to co-exist.

Nonetheless, Birla Sun Life, he said, would build its business around customers by offering quality products tailor-made to their requirements.

Since the insurance operations were founded on the proven technology platform used by Sun Life Financial globally, both Mr. Mitra and Mr. Javeri were convinced that this would help the company maintain individual account for every policyholder.

This, they claimed was unique to the Indian market and, hence, should stand Birla Sun Life in good stead vis-a-vis competitors.

The technology platform would provide a client-server solution with a Unix platform application.

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