Mukesh Ambani warming up to Allianz for insurance amid Bajaj exit plans? Here's what we know

Jio Financial Services Ltd., led by Mukesh Ambani, is reportedly in talks with German insurance giant Allianz SE to explore a potential insurance partnership in India. Discussions are focused on establishing both general and life insurance companies in India, claimed a Bloomberg report. These talks are in early stages, and it is still unclear if the companies will proceed with the plan.

Allianz is reportedly looking to exit its two existing joint ventures with Bajaj Finserv Ltd., marking the end of a partnership that has lasted more than two decades. Bajaj Finserv confirmed that Allianz is “actively considering an exit” from its life and general insurance ventures, citing a shift in Allianz's strategic priorities. This was confirmed following a report by Bloomberg.

The break-up between Allianz and Bajaj Finserv stems from a dispute over the direction of the partnership, with sources indicating that Bajaj’s refusal to allow Allianz to raise its stake at a discounted price contributed to the rift. Additionally, Allianz reportedly was not given a say in key strategic decisions.

A spokesperson for Jio Financial Services declined to comment on the ongoing speculation, stating, "If and when there are any material developments, we will continue to make necessary disclosures." A spokesperson for Allianz, based in Munich, also stated that the company does not comment on market rumors, Bloomberg stated in the report.

Jio Financial, which is currently led by veteran banker K.V. Kamath, has already ventured into financial services through a shadow banking operation and insurance brokerage. The firm has also teamed up with BlackRock Inc. to enter the asset management business. The addition of insurance to its portfolio would further Jio Financial’s ambitions of becoming a major player in India’s financial sector.

India’s insurance penetration rate is significantly lower than that of countries such as South Africa and Canada, highlighting the sector’s potential for growth. According to data from the insurance regulator, this presents a considerable opportunity for companies like Jio Financial and Allianz.

Business Today could not independently verify the details of the ongoing talks. The story will be updated following comments from Jio Financial and Allianz.