The joint venture, Apollo DKV Insurance Company, will offer health insurance to people in over 4,000 hospitals including 42 Apollo hospitals across the country.
Commenting on the new venture, Apollo Hospitals chairman Prathap C. Reddy said: "For us it is yet another milestone in a journey that began almost 25 years ago to make healthcare in India available, accessible and affordable to every individual no matter wherever he or she resides."
Apollo will hold 74 percent stake in the new company and the remaining portion will be with DKV AG.
Speaking at a media conference ahead of the official launch, Shobana Kamineni, director of Apollo DKV, said: "Our entry into health insurance is a logical extension of our continued contribution to healthcare delivery in India.
"Our mission is to constantly introduce innovative health insurance, wellness solutions and disease management that meet customer needs," she said.
The company plans to have a presence across 25 cities by the second year of operations and spread to over 100 locations by 2010.
"DKV, the European market leader of private health insurance business, contributes long-lasting health insurance and health-care experiences. Apollo perfectly fits into our strategy to establish private health insurance in growth markets, bridging insurance, medical services and the delivery of health care," said Jochen Messemer, responsible for DKV's international business and also a director of Apollo DKV.