*All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard T&C Apply
*Tax benefit is subject to changes in tax laws. Standard T&C Apply
Chairman and Managing Director of Star Health and Allied Insurance Company Limited, V Jagannathan informed that the company is planning to raise Rs. 350 crore by the end of FY15. Country’s first standalone insurer, Star Health will utilize funds from the current investors and dilute its stake to foreign investors.
Star Health planned the fund raising exercise after the Parliament Select Committee suggested the increase of Foreign Direct Investment (FDI) limit to 49%.
Star Health, with a capital base of Rs. 549 crore, is supported by the following investors-
ICICI Venture, Tata Capital, Oman Insurance Company, non-resident Indians, Sequoia Capital and Indian business houses.
On the raising of FDI, Jagannathan said that insurance is a business that requires a turnaround time of 6–7 years. With an experience of 40 years, he believes that the present scenario should allow the entry of foreign capital.
Earlier, Star Health primarily focused on insurance schemes sponsored by the government. In FY14, the company recorded about Rs. 1,050 crore as ‘gross direct premium underwritten’ and for the FY15, it is targeting Rs. 1,500 crore. Now, the company also deals in overseas travel insurance, mediclaim and personal accident. Jagannathan said the company hopes to make profit this year and is looking forward to an IPO in the next two years.
The top five companies in the health insurance sector include Star Health, Max Bupa Health Insurance Company, Religare Health Insurance Company, Cigna TTK Health Insurance Company and Apollo Munich Health Insurance Company.
India is expected to witness a higher penetration of health insurance from the current 15% to 45% by the year 2020.
(Source: This article has been adapted from the article "Star Health to raise Rs 350 crore in FY15" that appeared on December 11, 2014 in business-standard.com.)