Mahindra & Mahindra to Enter Life Insurance Sector in JV with Canada's Manulife

Mahindra & Mahindra Ltd (M&M) and Manulife have announced plans to set up a 50:50 life insurance joint venture in India, subject to regulatory approval. The move builds on the two companies’ existing partnership in the financial services space since 2020.

Both firms plan to invest up to ₹3,600 crore each, starting with an initial outlay of ₹1,250 crore over the first five years. Once regulatory clearance is received, the new venture will apply for an insurance licence and begin operations. Kotak Investment Banking advised the Mahindra Group on the transaction, with legal support from AZB & Partners, while Debevoise & Plimpton LLP acted as Manulife’s legal advisor.

“Mahindra’s brand strength, deep distribution capabilities in rural and semi-urban India, and execution excellence make life insurance a logical extension towards our goal of building a comprehensive financial services portfolio. Manulife is the best natural partner for us, given their global expertise in insurance products, underwriting, and reinsurance,” said Dr Anish Shah, Group CEO and Managing Director, Mahindra Group.

The two groups already have a joint venture in the mutual fund space. The partnership builds on the earlier success of Mahindra Manulife Investment Management, their 2020 mutual fund joint venture. The new life insurance company will focus on meeting India’s growing demand for protection and savings solutions, particularly in rural and semi-urban regions, the companies said in a statement.

“This will further strengthen our diverse portfolio and position us for tremendous growth in a mega economy of the future. We have a trusted partner in the Mahindra Group, with whom we already have a successful asset management collaboration. We see tremendous opportunity to build on our efforts by leveraging their deep distribution network alongside our industry-leading agency distribution and insurance expertise,” said Phil Witherington, President and CEO, Manulife.

Following the announcement, shares of Mahindra & Mahindra were trading marginally lower by 0.55% at ₹3,733 on the BSE at 9:50 a.m.

With the new venture, both companies aim to capture a share of India’s still under-penetrated life insurance sector.

The life insurance market has surpassed $20 billion in new business premiums, growing at a compound annual growth rate (CAGR) of 12% over the past five years. Yet India continues to have a high protection gap and low insurance penetration, providing significant long-term growth potential, the companies noted.

They added that these tailwinds position India to become the world’s fastest-growing life insurance market over the next decade, on track to become the fourth-largest globally.

“This growth is underpinned by robust GDP expansion, a rising middle class, and a supportive regulatory environment,” the companies said. The joint venture will, however, face strong competition from state-owned insurance behemoth Life Insurance Corporation (LIC), which controls more than 60% of the market, along with private players such as SBI Life Insurance Company, HDFC Life Insurance Company, and ICICI Prudential Life Insurance.