Sri Lanka insurance sector needs consolidation push: Presidential advisor

Mar 05, 2013 (LBO) – Sri Lanka’s insurance sector may need a regulatory push for mergers as another regulatory driven move splits general and insurance business, an influential head of an insurance firm has said. “While appreciating this effort, I am hopeful that the remaining issues on tax credits and stamp duty on property transfers will also be resolved in a similar manner,” she said.

She said last year life insurance sector grew at 10 percent, higher than the 5 percent seen in 2012 but general insurance growth slowed to 9 percent from 15 percent.

HNB Assurance had grown its life revenues 34 percent and non-life 9 percent. The firm is part of Sri Lanka’s Hatton National Bank group.

Ranee Jayamaha, chairperson of HNB Assurance, a newer but fast growing insurance firm who is also an advisor to Sri Lanka’s President said the splitting of general and life business is expected to weed out potentially non-viable firms.

“However, if the post segregation structure ends up with over 30 small sized companies instead of the 22 we had so far, the industry as a whole will be faced with sustainability
Issues,” she told shareholders in the annual report.

“Therefore, there is a clear need for a conso