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K.R. Srivats

Regulator's decision may force rethink on biz strategy

MS SHIKHA SHARMA

New Delhi April 12 Private life insurance companies are upset over the Pension Fund Regulatory and Development Authority (PFRDA) plan to go exclusively for public sector pension fund manager (PFM) to manage the new pension scheme (NPS).

The PFRDA Chairman, Mr D Swarup, had recently said that the process of selecting the three PFMs would soon get started and completed within eight weeks. Only public sector asset management companies would be allowed to participate in the bidding process, he had said. The three PFMs are expected to manage the contributions made to the NPS by the new recruits of the Central and State governments effective from April 1, 2004.

"We are disappointed with the decision to restrict the PFMs only to public sector. It was an opportunity for us. We have expertise in pension fund management that could have been leveraged. We have to now go back and rethink our strategy", Ms Shikha Sharma, Managing Director, ICICI Prudential Life Insurance Company Ltd, told Business Line.

ICICI Prudential Life Insurance has the largest market share among the private players in the life insurance industry space. Premium from new business during April 2006-February 2007 grew about 108 per cent for the company.

For the entire life insurance industry, premium from new business grew 120.41 per cent during April 2006 to February 2007 to Rs 57,937 crore from Rs 26,286 crore in the same period in the previous year.

Meanwhile, Aviva Life Insurance Company India Pvt Ltd's Managing Director, Mr Bert Paterson, said he was disappointed over the PFRDA plan to go in for only public sector PFMs initially.

He, however, said that Aviva Life expects to be a full player in NPS as and when the scheme was launched in totality (after the enactment of the pension reforms Bill). "We are sure that we will have a major part to play in the Indian pension sector," he said, hoping that the pension reform Bill would be passed soon.

More Stories on : Pension Plans | Life Insurance

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