Tokio Marine aims to dominate in India

Tokio Marine aims to dominate in India

NEW DELHI (Reuters): Japan's largest non-life insurer, Tokio
Marine & Fire Insurance Co, is committed to India for the long
term, and will strive to become the leading general insurer in
the country, a company official said.

"We want to be number one in India's non-life insurance
industry. This is the first time that Tokio Marine has set such a
goal in a foreign country," Takuya Okui, Tokio Marine
representative in New Delhi, said in an interview.

Tokio Marine has a joint venture with the Indian Farmers
Fertilizers Cooperative Ltd (IFFCO), India's largest producer of
fertilizer.

The joint venture, IFFCO-Tokio General Insurance Co Ltd,
recently received an insurance license from the government, which
followed the passage of a law by India's parliament which
dismantled decades of state control of the insurance industry.

"India, like many countries including Japan, had long
regulated the insurance industry because the insurance business
can be a drain on foreign reserves," Okui said.

Okui said payments of reinsurance premiums by insurers to
foreign reinsurance firms for risk-hedging, have traditionally
been considered a source of current account deficits because such
payments are usually made in foreign currencies.

But India's foreign reserves have increased in recent years,
and stood at US$37.077 billion as of November 17, a level which
is sufficient to cover more than nine months of imports.

Okui said one of the allures of India for insurers was the
rapid pace of growth of the insurance market. The size of the
non-life insurance market grew to around 100 billion rupees in
1999 from around 74 billion three years earlier.

"The insurance market in India has, in recent years, grown by
two to three times the speed of growth in its gross domestic
product," Okui said.

To take advantage of the speed of growth, Okui said Tokio
Marine, which holds the maximum 26 percent equity stake allowed
to foreign firms under the new Insurance Regulatory Development
Authority (IRDA) law, would tailor its business for retail
customers and small businesses in India.

"We want to grow out of relying on Japanese firms for business
overseas," Okui said.