Tata-AIG partners set to infuse more capital
The Hindu Business Line — November 14, 2006

The joint venture partners of Tata-AIG General Insurance Company are preparing to further beef up the capital ahead of deregulation of tariffs in the non-life insurance sector. The Tata-AIG's chief operating officer, Michael Carlin, told Business Line, "We are prepared to bring in more capital, if necessary for growth of the business. Both the partners are committed to increasing the capital." At present, Tata-AIG is capitalised at Rs 175 crore, where the Tata Group holds 74 per cent stake.

Carlin admitted that premiums in some segments were likely to drop with the beginning of deregulation. This is in line with other international markets, where market-based risk pricing is adopted. However, this would eventually lead to efficiencies and self-correction, he added, as has happened in other markets. This drop in premiums is also likely to bring in pressure on incomes, Carlin said.