Life Insurance Corporation of India (NSEI:LICI), the country?s largest insurer, is in advanced discussions to acquire up to 50% of the stake in ManipalCigna Health Insurance Company Limited, marking its strategic entry into the health insurance sector, reported The Economic Times citing sources. This move is seen as a significant step for LIC as it seeks to expand its footprint into the market for medical expense coverage, which is currently underserved. ManipalCigna Health Insurance is a joint venture between the Manipal Education & Medical Group and the US-based Cigna Corporation.

The Bengaluru-based Manipal Group currently holds a 51% majority stake in the health insurer, with the remaining 49% owned by Cigna. The discussions, still in their preliminary stages, are aimed at allowing LIC to diversify its portfolio beyond life insurance and tap into the growing demand for health insurance, which accounts for 37% of the INR 3 trillion general insurance industry. ?Both parties have signed a non-disclosure agreement and are progressing with talks for LIC to acquire approximately a 50% stake in the venture,?

a source said to The Economic Times. According to initial discussions, both the Manipal Group and Cigna will proportionally reduce their stakes in the company. The deal, if finalised, could value ManipalCigna Health Insurance at approximately INR 40.00 billion, the source noted.

During the company?s earnings call on November 8, Siddhartha Mohanty, Managing Director and Chief Executive Officer of LIC, confirmed the insurer?s plans to acquire a stake in an existing standalone health insurer within the current financial year. ?Our groundwork is underway, and within this financial year, we expect to acquire a stake in an existing standalone health insurance provider,? he said, without offering further details.