Lloyd’s of London is set to establish a branch in Mumbai in 2017 after receiving approval from the Indian regulator, Insurance Regulatory and Development Authority of India (IRDAI), allowing it to provide onshore reinsurance service in India.
"This is a very significant day for Lloyd’s and we look forward to establishing a branch in Mumbai in 2017. I believe Lloyd’s can bring unique benefits to India by providing both protection and new opportunities for many domestic insurance businesses,” said John Nelson, chairman of Lloyd’s.
“India is one of the world’s greatest growing economies. I passionately believe that our presence will contribute to the development of a more diverse reinsurance market, which is fundamental to the stability and future growth of the Indian economy. This can help position India as a centre for insurance, reinsurance and associated services.
As India opens its market to international reinsurers, major foreign players are applying for licences to take advantage of the country’s strong growth potential.
Reinsurers hoping to operate in India from 2017 include Munich Re, Swiss Re, SCOR Re, Hannover Re, RGA (Reinsurance Group of America) and Berkshire Hathaway’s reinsurance unit Gen Re, according to news reports.
“The progress India is making in reforming reinsurance markets is encouraging and will bring lasting benefits to the Indian economy. A level playing field for all reinsurers will mean that domestic market can thrive and become a hub for innovative new products that meet the need of businesses.”
Liam Fox, international trade secretary, added: “This is a symbolic decision and one that will not only provide protection for growing Indian businesses but also bring additional revenue to the UK insurance sector.
“This move is yet another example of the strong economic and commercial partnership between the UK and India - a partnership that is extremely important to me and the UK government. The bonds we share, not just of commerce and trade but also historically and culturally, will be at the very heart of the strategic relationship between our two nations.”
Foreign reinsurers are attracted by India’s comparatively low insurance penetration and growth potential, which is likely to also benefit the reinsurance sector.
Lloyd's, Insurance, Reinsurance, London, UK, India