Paytm, CEO Sharma to acquire general insurer Raheja QBE for Rs 568 crore

Raheja QBE will be acquired through QorQl Pvt. Ltd, a technology company in which Vijay Shekhar Sharma has majority shareholding.

Paytm and its CEO Vijay Shekhar Sharma will acquire Raheja QBE, a Mumbai-based private sector general insurer, for nearly Rs 290 crore to expand the digital payments company's financial services.

Raheja QBE, which started operations in 2009, is a joint venture between Prism Johnson Limited and QBE Insurance Group, one of Australia’s largest insurers. Raheja QBE employees would continue working in Mumbai and other places, said the company.

According to regulatory filings made by Prism Johnson, Raheja QBE will be sold "to QORQL Private Limited, a technology company with majority shareholding of Vijay Shekhar Sharma and remaining held by Paytm (owned by One97 Communications Limited), for an aggregate consideration of Rs. 289.68 Crores".

One97 is the parent company of Paytm. The acquisition is expected to close by March 31, 2021, depending on approvals from the Insurance Regulatory and Development Authority of India (IRDAI).

"It is an important milestone in Paytm’s financial services journey, and we are very excited to welcome Raheja QBE General Insurance into the Paytm family. Its strong management team will help us accelerate our journey of taking insurance to the large population of India with the aim to create a tech-driven, multi-channel general insurance company with innovative and affordable insurance products,” said Paytm president Amit Nayyar.

Motor insurance: Six must-know ways to save yourself from fake policies

The insurance transaction process often includes reliance on third-party service providers, making insurance companies highly susceptible to fraud within and along its value chain.

The Motor Vehicles Act deems it mandatory for all car owners to have vehicle insurance. The number of road accidents are rampant, reinforcing the importance of a comprehensive motor insurance policy for all vehicles. This is applicable for all commercial vehicle owners who are required to purchase the motor insurance to protect, both, their drivers as well as third-parties from unprecedented accidents. This necessity has given rise to an increase in fraud insurance cases which in-turn is a concern for the insurance industry.

The insurance transaction process often includes reliance on third-party service providers, making insurance companies highly susceptible to fraud within and along its value chain.

Significant gap in awareness about the insurance coupled with the misrepresentation of it being a dead investment by customers makes them an easy prey for fraudsters. Now with the recent rule, where 2 wheeler owners have to purchase third party policy for a period of 5 years and private car owners have to purchase it for 3 years in addition to own damage policy, the premium slab for vehicle insurance has increased drastically for the consumer.

This has given rise to opportunities to fruadsters to sell fraud policies to unsuspecting customers, since these are offered at much lower premiums relative to the actual cost of a genuine policy.

Such fraud trends have been noticed across the country and several FIRs have been lodged in large numbers in cities across West Bengal, Maharashtra, Telengana, Karnataka, Tamil Nadu, Delhi, UP, Gujarat, Kerala to name a few.

6 essential ways to protect yourself from fake policies:

In India, since a third party motor insurance is made mandatory by law, it is still the most common form of general insurance that people buy. And since customers are not aware about the details of the policy offering and rather consider it to be a mere formality along with other documentation, they easily get tricked by fraudsters. These fraudsters edit genuine policy copies previously issued by insurance companies to generate totally fake policies in the names of the new customers. These same policies are then shared with both the customers and the RTO. Not only is this unlawful, but also puts the customer in a poor financial situation in case of an accidental exigency, even more so in case of third party life/property damage where the compensation amounts can run into crores.

Business Standard