Reliance Capital to hive off its health insurance business

Reliance Capital (RCL), a part of the Anil Ambani-led Reliance Group, has unveiled plans to separate its retail health insurance business from its general Insurance business. Reliance Health Insurance, the proposed new company for health insurance business, will be a wholly-owned subsidiary of RCL.

The board of directors of Reliance General Insurance Company (RGIL), a subsidiary of RCL, has approved this proposal, subject to necessary IRDA and other approvals. RGIL has a well-established portfolio of health insurance business that offers a comprehensive range of competitive products to consumers.

RCL’s insurance business recorded gross written premium of Rs 570 crore in FY16 through its network of over 175 branches across the country.

Health insurance in India has been amongst the fastest growing insurance segments and is expected to nearly double to Rs 50,000 crore by 2020. RCL’s proposal will enhance management focus on health insurance and provide flexibility to the company to unlock value by bringing in global leaders in this space as strategic and equity partners.

The share price of RCL increased 9.2 per cent and closed at Rs 607.6 on an intra-day basis.