Nippon Life Insurance Company will buy 35 percent of stake in an insurance firm under Myanmar’s Grand Guardian Life Insurance Holding Public Co., Ltd

Nippon Life Insurance Co. of Japan will buy a 35 percent stake in an insurance firm under Myanmar’s conglomerate Shwe Taung Development Co. to enter the underdeveloped market.

The Japanese leading life insurer said Friday it has agreed with Grand Guardian Insurance Holding Public Co. to pay $21 million for the share of its life insurance arm Grand Guardian Life Insurance Co.

Nippon Life expects to complete the transaction sometime between September and October, subject to the relevant regulatory approval, and will rename the joint venture Grand Guardian Nippon Life Insurance Co., it said in a statement.

Nippon Life agreed with Grand Guardian Insurance Holding in April to form a joint venture to tap the market in an early stage of development, the Japanese company said

Aside from Grand Guardian Insurance, three other foreign life insurance companies have applied to form joint ventures with local partners: Citizen Business Insurance, First National Insurance and Capital Life Insurance. In April, British Prudential, Japanese Dai-ichi Life, Hong Kong AIA, US Chubb and Canadian Manulife were authorised to establish wholly-owned life insurance subsidiaries.

Myanmar opened the insurance sector in 2013 by granting licenses to local private insurers after nearly half a century of monopoly under the state-backed Myanmar Insurance Co.

The government announced in January the opening of the sector to foreign firms, allowing them up to 35 percent ownership of insurers. It is now expecting a total of 29 foreign and local life and non-life insurance companies to operate in Myanmar. Of the 29 insurance providers, 17 provide life insurance. 

In Myanmar, insurance penetration stands at just 0.07 percent of GDP, with the market valued at just US$70 million in 2016-17. Non-life insurers contributed to more than 70pc of the market. There are 30 categories of insurance products now being offered, with property insurance representing 80pc of total non-life income, according to Myanmar Insurance Association. – Kyodo

(The Myanmar Times: https://www.mmtimes.com/news/nippon-life-buy-35pc-myanmars-grand-guardian-life-insurance.html )

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