Date:22/07/2004 URL: http://www.thehindubusinessline.com/2004/07/22/stories/2004072201820800.htm

Back Sun Life may hike stake in insurance venture

Our Bureau

Hyderabad , July 21

IN A bid to take advantage of the foreign direct investment (FDI) norms announced in the Union Budget, Sun Life Financial Inc plans to to hike its stake in Birla Sun Life Insurance.

The Finance Minister had announced a lift in the sectoral cap in the insurance sector to 49 per cent from 26 per cent currently.

The Canada-based Sun Life Assurance Company is bullish on pumping more funds into its joint venture with the Birlas, said the Vice-President (Underwriting), Sun Life Insurance, Mr Joe Dahl.

At the launch of `Critical Illness Plus Rider' and `Woman First Plan', Mr Dahl said the Government's move to hike FDI limit in the insurance sector was a positive step and Sun Life was contemplating to hike its stake in the Indian joint venture.

Birla Sun Life injected a capital of Rs 110 crore during the last fiscal. Thecompany is expected to require less capital this yearcompared to the previous year as infrastructure costs were estimated to be lower owing to the initiatives taken, especially in the direct sales front.

Birla Sun Life, which claims to be the second in business among the private sector life insurance market, witnessed a 373 per cent growth in premium income at Rs 538 crore for a assured sum of Rs 8,915 crore.

Of the annualised sales of Rs 478 crore, direct sales were Rs 201 crore, followed by alternative channels at Rs 114 crore and group life cover at Rs 163 crore, said the Vice-President (Marketing and Communication) of Birla Sun Life Insurance, Ms Anjana Grewal.