Shares of Home First Finance surged nearly 4% on Thursday (February 22) in the wake of receiving a composite license from the Insurance Regulatory & Development Authority of India (IRDAI). This development empowers Home First Finance to diversify its offerings by engaging in the sale of life, general, and health insurance products.
As of the latest available information, Home First Finance's market capitalisation stands at around ₹8,221 crore.
On BSE, the stock was trading 2.49% higher at ₹933 apiece at the time of writing this report.
The composite license, issued through a certificate dated February 21, 2024, falls under the Insurance Regulatory and Development Authority of India (Registration of Corporate Agents) Regulations, 2015.
Home First Finance's newly acquired license is valid from February 21, 2024, to February 20, 2027, according to details provided in a regulatory filing.
On Monday, PB Fintech's wholly-owned subsidiary, Policybazaar Insurance Brokers, also received in-principle approval from IRDAI to transition from a direct insurance broker to a composite insurance broker.
The composite license allows companies to operate as intermediaries in both life and general insurance, providing customers with a one-stop shop for their insurance needs.
This expansion into multiple insurance categories enhances the service offerings of financial entities.
Recently, a parliamentary panel proposed a shift in the insurance sector, suggesting that insurance companies be granted a composite license to offer a wide spectrum of products.
This recommendation comes with the added flexibility for prospective insurers to apply for sub-classes of business, such as accident, health, and motor insurance.
The existing regulatory framework prohibits insurers from selling both general and life insurance policies through a single entity.
Therefore, the proposed shift towards composite licensing necessitates amendments to the Insurance Act, 1938, and the Insurance Regulatory and Development Authority Act, 1999.
(Edited by : Amrita)
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