Insurance regulator Irdai has given preliminary approval to five foreign reinsurance players as part of the elaborate licensing process.
Insurance and Regulatory Development Authority of India (Irdai) brought in guidelines for the re-insurance sector in November last year.
The five reinsurers that got approval, known as R2, are Swiss Re, Munich Re, Hannover Re, French major SCOR and Reinsurance Group of America, sources said.
These players got preliminary approval (R1) from the regulator recently. Irdai follows two levels of approval process before certificate of registration is granted to any player to operate in the country.
According to the sources, foreign reinsurers have raised concerns that according to the draft guidelines, even if branches are set up, the right of first refusal for reinsurance generated in India will go to the state-run General Insurance Corporation of India.
The regulator is looking into the concerns raised by the prospective players.
GIC Re is the only reinsurer fully operational in the country now. Last year, the regulator has already given Lloyds India permission to work as marketplace and the constituents are housed in one location for the conduct of reinsurance business.