Kotak Life Insurance ups capital to 317 cr to fund expansion plans

New Delhi, June 26 (UNI) Kotak Mahindra Old Mutual Life Insurance Ltd today said it has increased its share capital by Rs 20 crore, and its promoters have infused additional funds to increase the capital of Kotak Life Insurance to Rs 317 crore.

The infused capital would be used as per the prudent capital adequacy norms towards augmenting Kotak Life Insurance's business volumes and its network.

Post allotment of the additional rights shares, the percentage of the shareholding pattern of the company will remain the same.

Currently, Kotak Life Insurance has a presence in 35 cities with 12,500 life advisors and 2133 employees. The coming year would see Kotak Life Insurance strengthening its distribution, brand and operations to cement its position as a long term value player in the Life Insurance business.

With plans to grow 100 per cent on its First Year Premium (FYP) base, the focus would also be to expand geographically to cover 24 more locations across the country.

Old Mutual Plc holds 26 per cent, while Kotak Mahindra Bank Ltd holds 74 per cent in the joint venture at present.

The Board of Directors of Kotak Mahindra Old Mutual Life Insurance Ltd (Kotak Life Insurance) also declared a total return of 7 per cent including a 4 per cent bonus on its participating contracts for the financial year ended March 2006.

This is an increase of 25 basis points over the previous year return of 6.75 per cent.

Kotak Life Insurance has achieved a growth of 100 per cent in the FYP collected from Individual Regular Premium Policies. With a Regular Premium Income of Rs 349 crore in 2005-06 as against Rs 174 crore in 2004-05, Kotak Life Insurance has displayed an impressive growth over the previous year.

The Adjusted Premium Equivalent, a standard measure in the Industry that takes Single Premium Income at 10 per cent, has grown from Rs 209 crore in 2004-05 to Rs 366 crore in 2005-06, up by 76 per cent.

Kotak Life Insurance also saw its Total Received Premium jump from Rs 454 crore in 2004-05 to 640 crore in 2005-06.

Kotak Mahindra Old Mutual Life Insurance is a joint venture between Kotak Mahindra Bank Ltd and Old Mutual plc.

Kotak Mahindra is worth Rs 2,000 crore, while Old Mutual has assets under management worth 183 million pounds as on December 31,2005.

UNI RA PV RK1821