ICICI Prudential Life Insurance, India’s largest private life insurer, would take over peer Sahara India Life Insurance Company, headquartered in Lucknow.
The insurance regulator, Irdai, had taken over Sahara India Life last month on charges that “it is acting in a manner likely to be prejudicial to the interests of holders of life insurance policies.”
Nilesh Sathe, member-life at the insurance regulatory and development authority of India (Irdai) told Financial Chronicle that ICICI Prudential Life will buy out the liabilities and assets earmarked for policyholders of Sahara Life. “It has already begun the valuation exercise for the policyholders’ assets and liabilities. Beyond that the employee liabilities and the shareholders liabilities of Sahara India Life will remain with Sahara itself,” Sathe said
“Not a rupee will be paid to Sahara Life’s promoters by ICICI Prudential Life. This is a transfer of the policyholders’ assets and liabilities of Sahara India Life to ICICI Prudential Life. We expect the transfer of the business to be completed within two months,” Sathe added.
On Tuesday ICICI Prudential Life said that it has expressed its interest in buying out Sahara Life Insurance. The last reported policyholders liabilities of Sahara Life is about Rs 900 crore, which is less than 1 per cent of ICICI Prudential Life Insurance’s balance sheet size said ICICI Prudential in a notice to the BSE.
ICICI Prudential is the largest private life insurers with AUM as on March 31, 2017 at Rs 1.22 lakh crore.
On June 23, the insurance regulator took over Sahara Life Insurance Company and stopped Sahara from procuring, collecting proposal deposits and underwriting new business with immediate effect.
It was, however, allowed to continue to collect and account for the renewal premium; and service the existing business and policyholders, unhindered.
On June 12, the insurance regulator had said that Sahara India Life Insurance “is acting in a manner likely to be prejudicial to the interests of holders of life insurance policies” and appointed RK Sharma, general manager (finance and account non-life) at the Irdai as administrator to manage the affairs of the company.
It asked Sharma to file a report stating the most advantageous course of action in the general interest of the holders of life insurance policies.
The regulator offered Sahara’s India Life’s business to six insurers, of which ICICI Prudential Life evinced interest, said Sathe. The six insurers were LIC, ICICI Prudential Life, HDFC Life, Bajaj Allianz Life Insurance, Kotak Life, and SBI Life.
ICICI Prudential Life is the only company to be publicly listed as of now. Shares of ICICI Prudential Life Insurance closed at Rs 489.35, up 3.66 per cent.
ICICI Prudential Life to take over Sahara Life Insurance
