Jio Financial Services (JFSL) on Friday announced that it has entered into a binding agreement to form a 50:50 domestic reinsurance joint venture (JV) with Allianz Group (Allianz). The Munich-based group, through its wholly-owned subsidiary Allianz Europe B.V. acted on the deal.
The two firms also entered into a non-binding agreement for setting up equally owned joint ventures for both general and life insurance businesses in India. The two financial services brands are ” coming together to deliver innovative and holistic protection solutions to the people of India,” read a statement from Allianz.
The company stated that the reinsurance joint venture will build on Allianz’s current Allianz Re and Allianz Commercial portfolios and operations within India. It will also draw on Allianz’s global infrastructure, particularly its strengths in pricing, risk assessment, and portfolio management. Allianz Re itself has been providing reinsurance services in India for more than 25 years.
Following the announcement, the JFSL stock price saw a downward turn of nearly 0.5% whereas Allianz SE is up 0.17% today.
For over two decades, Allianz partnered with Bajaj Finserv through two insurance joint ventures: Bajaj Allianz Life and Bajaj Allianz General, holding a 26% stake in each. In October last year, Allianz signalled its plan to part ways with Bajaj Finserv, and by March this year, Bajaj Finserv confirmed it would acquire Allianz’s shares in both ventures for Rs 24,180 crore. After the announcement, there was widespread speculation that Allianz might team up with JFSL to establish new insurance joint ventures.
Isha Ambani, the non-executive director JFSL said, “This partnership, combining Allianz’s global reinsurance expertise with JFSL’s deep understanding of the Indian market and strong digital infrastructure, aims to deliver innovative and customized reinsurance solutions to insurers.” Aligned with the goal of ‘Insurance for All by 2047’, the joint venture is aimed to building a more inclusive insurance system.