TTK Group has decided to exit from the Cigna TTK health insurance joint venture (JV) by selling its 31.5% stake to Manipal Group for ₹500 crore.
Manipal Education & Medical Group (MEMG) chairman Ranjan Pai told The Hindu that his company would increase its holding in the JV to 51% from the existing 19.5% at a cost of ₹500 crore. The Cigna Corporation of the U.S. will continue to hold 49% stake.
“We are buying the stake from TTK Group as they are exiting. However, all these, except the name change of the joint venture , are subject to further approvals from the regulator.” With TTK’s exit, the name of the JV has been changed to ManipalCigna Health Insurance Company Limited.
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The venture has also adopted a new corporate identity, a new logo and a new website. These changes are effective immediately and all future business activities will be under the new company name.
Dr. Pai said: “Our aim is to become the third-largest standalone health insurance player in the country in the next couple of years.”
Star Health Insurance, Apollo Munich, Religare and MaxBupa are the leading standalone health insurance players in the country.
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High-growth sector
Health insurance is a high-growth sector in the country, growing at a compounded annual growth rate of 26%. Medical inflation has been high with disease burden seeing a steady rise in the country.
“Despite all these, the country is underinsured. However, people are slowly realising the importance of having a safety net when it comes to health,” he added.
The Indian insurance sector had ‘tremendous’ growth potential and was an important market for Cigna Corporation, said Jason Sadler, president, Cigna International Markets.