Reliance Life Insurance Company (RLIC) is open to giving a small equity, say, up to 5 per cent, to a commercial/co-operative bank to get it on board for selling the insurer’s products, the company’s Chief Executive Officer, Anup Rau, said.
Rau’s remark is significant as it comes on the heels of Insurance Regulatory and Development Authority’s move to allow banks to act as insurance brokers.
Allowing banks to act as brokers and sell products of more than one insurer is expected to benefit non-bank promoted life insurers, such as Reliance Life.
This will open up the distribution opportunity for Reliance Life Insurance, which has so far been dependent on agency model for its revenues.
Reliance Life is now in talks with several banks to see if they would opt to become brokers of this life insurer’s products, Rau said.
“We must give a chance for this (banks to act as brokers) to succeed. It will help enhance insurance penetration”, he told Business Line .
Asked about the focus areas for the company this year, Rau said efforts would be made to improve agency productivity. The company would also look to improve the quality of its books, he added.
Japanese insurance major, Nippon Life, has a 26 per cent stake in Reliance Life. This stake was purchased from Reliance Capital for $680 million in 2011.