In a strategic move to boost its presence in the insurance sector, the Central Bank of India announced on June 27 that it has completed the acquisition of significant equity stakes in Future Generali India Insurance Company Ltd (FGIICL) and Future Generali India Life Insurance Company Ltd (FGILICL). The bank acquired a 24.91% stake in FGIICL and 25.18% in FGILICL, marking a significant step in expanding its footprint in both general and life insurance markets.
The deal, which followed the finalization of definitive agreements with Generali Group, includes key Shareholders’, Trademark, and Distribution Agreements. Having received necessary regulatory clearances, including approval from the Reserve Bank of India (RBI), the public sector bank is poised to execute a broader strategic roadmap in the insurance domain.
Central Bank of India, with its extensive network of over 4,500 branches and 20,000 customer touchpoints, plans to leverage its infrastructure and digital platforms to distribute insurance products more efficiently. The focus will be on small-ticket customers, first-time insurance buyers, and those in semi-urban and rural areas who have traditionally had limited access to structured insurance coverage.
The bank acknowledged the advisory role of Ashvin Parekh Advisory Services LLP (APAS), which assisted in strategic planning, valuation, and due diligence. Legal services were provided by Cyril Amarchand Mangaldas (CAM), advising on the finalization of legal and transactional documents.
This partnership comes at a time when Indian public sector banks are looking to diversify their product offerings and enhance non-interest income streams. With insurance penetration in India remaining low, particularly in rural and semi-urban markets, this move positions Central Bank of India to tap into a growing market opportunity.
According to IRDAI data, life insurance penetration in India stood at 3.2% in FY23, while general insurance penetration was even lower. The partnership with Generali is expected to enable the bank to deliver life, health, and general insurance products suited to the Indian market, thereby expanding its presence in the insurance sector.
