What are your views on the provisions of the insurance bill, particularly the initial capital of Rs 100 crore, the 26 per cent equity cap for foreign insurers, the rural exposure and the issue of repatriation of profits?
The opening up of the Indian insurance sector has been long overdue and although the government has been slow to come outwith operational details, I am particularly satisfied with the regulations. In fact, the focus on solvency and transparency, on mandated exposure and investments and the initial capital of Rs 100 crore indicates a prudent and careful regulatory regime. Though most companies will be overcapitalised in the initial years, the subsequent years will require substantial funds to satisfy the solvency margin. In fact, we would have preferred a higher stake in the Indian venture than the proposed 26 per cent equity cap. I hope the policymakers will allow us to increase our stake at a later stage.

On the issue of repatriation of profits, I do not foresee any company managing to garner sufficient profits in the initial five to seven years. Most of the profits will in fact be used for product and market development or will be ploughed back to meet the solvency margin requirement.

What would be your core products, and how do you propose to differentiate yourself and offer a price advantage?
Canada Life plansto offer a wide range of life insurance and pension products in India. To start with, Canada Life will focus primarily on the semi-urban and rural markets. The Indian investor is conservative and looks for benefits such as savings, tax benefits and returns (like the money back policy offered by the Life Insurance Corporation). The risk cover offered by insurance products remains a secondary objective.

As a first step, we need to develop awareness about the intrinsic advantages of insurance cover. However, to target the returns-conscious investor, we will also offer equity-linked insurance products, like `universal life'. Pension products will also be an important segment.

A lot of the products to be offered will be similar to the ones already being sold by the LIC. However, the differentiating factor will be the quality and efficiency of service. As far as pricing goes, I anticipate some price-undercutting. However, customer service, product quality and actuarial excellence will be the key tosurvival.

How do you view your alliance with the Centurion Bank? Are you looking for other partners and do you intend to pick up some stake in Centurion Bank?
The Canada Life-Centurion Bank agreement was signed in October 1996 and provides that the joint venture will offer life insurance, pension products, annuities, segregated funds and, if permissible, health products. The tieup will be significantly benefited from Centurion Bank's retail network, its efficiency and quality of customer service and the excellent infrastructure.

We are, therefore, not scouting for any other partner for our India operations. As far as picking up a stake in Centurion Bank is concerned, this has not been on our agenda yet. However, at a later stage we may look for a mutually agreeable equity participation in Centurion bank, if it offers some significant advantages to out insurance venture.

We will use the expertise and client base of Centurion Bank to retail our products. However, we will also set up a team oftrained full-time dedicated sales representatives. Our differentiation will be the efficiency and quality of customer service.