Mumbai: German health insurance giant Deutsche Krankenversicherung AG (DKV), part of the Munich Re group, is entering the Indian health insurance market, through a joint venture with Apollo Hospitals.

The Insurance Regulatory Development Authority (IRDA),the insurance industry regulator, now allows stand-alone health insurance companies to operate in India. Other international majors, including the UnitedHealth group of the US, are keen on entering this largely untapped market.

However, the American company is awaiting further liberalisation in the industry, as it wants to have a 49-per cent stake in the new venture. Current rules restrict foreign holdings to just 26 per cent. Finance Minister P Chidambaram in his budget speech had said the government was keen to raise this to 49 per cent, but the Leftist allies of the United Progressive Alliance (UPA) government are opposed to the move.

UnitedHealth already offers healthcare services to the corporate sector, and has seen its business grow by 30 per cent annually.

The IRDA estimates that the health insurance segment can generate huge premiums, perhaps up to Rs1 lakh crore, if the sector is allowed to grow. At present, non-life insurers offer health cover to customers. The non-life (general insurance) sector is mainly dominated by the motor insurance business.

The general insurance sector grew by 20 per cent during the first five months of the current fiscal. The dozen players in the sector reported total premium of Rs10,427 crore between April and August 2006, as against Rs8,668 crore in the corresponding period in the previous fiscal.

Besides the four state-owned general insurance firms, there are eight private companies. The IRDA is introducing a de-tariffied regime from January, allowing insurance companies to fix their own premia.

State-owned New India Assurance, which dominated the business, has seen its share fall to a little over 20 per cent. ICICI Lombard, a leading private non-life insurer, has grown its market share to over 12 per cent. The eight private general insurance companies now account for 35 per cent of the market share of premiums.