Chennai: At a time when the Indian general insurers are chasing top line growth focusing on the corporate segment and at the retail end of health insurance, the Jaipur-headquartered Shriram General Insurance Company Ltd is aiming to garner Rs 2 billion business through small ticket policies.
"Unlike the life insurance players, the existing players in the non-life insurance sector have not contributed much in expanding the insurance penetration. The sector has grown along with the economy," Shriram group chairman R. Thyagarajan told reporters here Wednesday.
According to him, the group's non-life insurance arm Shriram General would push aggressively liability products as well as home insurance to touch a premium income of Rs.2 billion during the first full year of operations.
The new non-life insurance company is expected to start transacting business from July 23 when Finance Minister P. Chidambaram will launch its operations.
Shriram General is a 74:26 joint venture between the city-based Shriram Group through Shriram Financial Services and Holdings Private Limited and Santam, the general insurance arm of Santam group of South Africa.
Asked whether the first year target is not quite stiff as the company will be focusing on small-ticket policies, Thyagarajan said: "The group is a large-scale truck financier in the country. Tapping into that segment alone would give us around Rs.1 billion. In addition there will be our agency force selling retail policies."
Thyagarajan is confident the company would start earning profit from the first year onwards.
"Globally a 10 percent return on the premium earned is considered as good by promoters of insurance companies. We hope to earn more than that," he said when asked about the targeted rate of return.
Shriram General will have around 35 branches in 20 Indian cities initially and will later expand the branch network.
Source: IANS
Thursday, July 17, 2008
Reliance Mutual Fund launches insurance scheme
Reliance Mutual Fund on Tuesday unveiled the Reliance Strategic Investment Plan (SIP) a unique life insurance plan, which ensures that all planned investments are completed event in the case of an untimely demise of the investor.
The facility is currently provided in 10 select equity schemes of Reliance Mutual Fund.
Reliance MF expects 80% growth in asset base this fiscal
"The advantage of Reliance SIP Insure–free life insurance cover is that in the event of death of an investor, the balance unpaid SIP installments will be made good from the insurance cover," said Vibrant Gugnani, CEO Reliance Capital Asset Management Ltd.
Once there, the nominee will be able to continue in the scheme without having to make further contribution to the scheme, so that the investors long term financial planning and objective of investing through SIP is fulfilled as per the targeted time horizon.
"In addition to helping investors organise their process of investing, this scheme helps in rupee cost averaging, wherein one need not worry about when and how much to invest. A fixed sum of money can be invested regularly and over time it averages out the costs," said Gugnani.
The company is however planning to reach the investors with the assistance of 8,372 distributors in the western region, of which 1,330 are present in Pune alone. In the western region, Reliance Mutual Fund has its presence in the 16 cities in various states.
Source: DNA MONEY
The facility is currently provided in 10 select equity schemes of Reliance Mutual Fund.
Reliance MF expects 80% growth in asset base this fiscal
"The advantage of Reliance SIP Insure–free life insurance cover is that in the event of death of an investor, the balance unpaid SIP installments will be made good from the insurance cover," said Vibrant Gugnani, CEO Reliance Capital Asset Management Ltd.
Once there, the nominee will be able to continue in the scheme without having to make further contribution to the scheme, so that the investors long term financial planning and objective of investing through SIP is fulfilled as per the targeted time horizon.
"In addition to helping investors organise their process of investing, this scheme helps in rupee cost averaging, wherein one need not worry about when and how much to invest. A fixed sum of money can be invested regularly and over time it averages out the costs," said Gugnani.
The company is however planning to reach the investors with the assistance of 8,372 distributors in the western region, of which 1,330 are present in Pune alone. In the western region, Reliance Mutual Fund has its presence in the 16 cities in various states.
Source: DNA MONEY
INVESTORS SHRUG OFF MARKET JITTERS, LINE UP FOR ULIPs
Despite the jittery stock markets, investors have so far not shied away from unit linked investment plans (Ulip). Investments in Ulips, in fact have risen by 8% to Rs 4,928 crore till May this year, according to figures released by the insurance regulatory and development authority. Till May 2007, Rs 4,531 crore was invested into such schemes.
Private life insurance companies are the better performers with a 66% growth in investments into Ulips. As compared to Rs 1,772 crore invested in such plans till May last year, in the first two months of this fiscal these companies have received investments amounting to Rs 3,030 crore.
However investments in public sector giant Life Insurance Corporation’s (LIC) unit-linked plans have dipped a significant 31% to Rs 1,900 crore till end May 2008 as compared to Rs 2,760 crore.
Analysts, however, feel that this is not really a cause of concern as most investments into LIC pour in the second half of the financial year when people begin their tax planning. SB Mathur, chairman Life Insurance Council, said, “More investments into LIC are likely to flow in as the financial year draws to an end.”
Ulips, which account for close to 90% of the life insurance policies, work like mutual fund schemes and provide an option to invest in equities but also have an insurance component.
As of now the market for such unit-linked plans is still strong despite the stock market volatility as most investors feel that there is no reason to worry, as these are long-term investments. The 30-share Bombay stock exchange sensex, which was at close to 20,000 in January has now dropped to 12,000-mark. On Wednesday it closed at 12,575.80 points.
However Mathur pointed out that the stock market chill might eventually begin affecting Ulips as well. In fact products such as health insurance, pension plans and money back schemes may once again stage a come back. He said many life insurance companies have already begun looking at selling other products more aggressively.
A word of caution was also recently sounded off by a Credit Suisse report that said that while there is at present strong growth in Ulips, if markets continue to remain weak, they would be affected.
Source: Surabhi
The Financial Express
Private life insurance companies are the better performers with a 66% growth in investments into Ulips. As compared to Rs 1,772 crore invested in such plans till May last year, in the first two months of this fiscal these companies have received investments amounting to Rs 3,030 crore.
However investments in public sector giant Life Insurance Corporation’s (LIC) unit-linked plans have dipped a significant 31% to Rs 1,900 crore till end May 2008 as compared to Rs 2,760 crore.
Analysts, however, feel that this is not really a cause of concern as most investments into LIC pour in the second half of the financial year when people begin their tax planning. SB Mathur, chairman Life Insurance Council, said, “More investments into LIC are likely to flow in as the financial year draws to an end.”
Ulips, which account for close to 90% of the life insurance policies, work like mutual fund schemes and provide an option to invest in equities but also have an insurance component.
As of now the market for such unit-linked plans is still strong despite the stock market volatility as most investors feel that there is no reason to worry, as these are long-term investments. The 30-share Bombay stock exchange sensex, which was at close to 20,000 in January has now dropped to 12,000-mark. On Wednesday it closed at 12,575.80 points.
However Mathur pointed out that the stock market chill might eventually begin affecting Ulips as well. In fact products such as health insurance, pension plans and money back schemes may once again stage a come back. He said many life insurance companies have already begun looking at selling other products more aggressively.
A word of caution was also recently sounded off by a Credit Suisse report that said that while there is at present strong growth in Ulips, if markets continue to remain weak, they would be affected.
Source: Surabhi
The Financial Express
ICICI PRU LIFE LAUNCHES PROGRAMME
ICICI Prudential Life Insurance announced the launch of a unique 6 months Certification Program-PGPMI (PGPMI), a specialized management program focusing on the insurance industry.
The company has inked exclusive partnerships with 10 leading business schools in India. The program has been designed to train and develop skilled professionals, with in-depth knowledge of the industry along with the managerial abilities.
Source: The Financial Express
The company has inked exclusive partnerships with 10 leading business schools in India. The program has been designed to train and develop skilled professionals, with in-depth knowledge of the industry along with the managerial abilities.
Source: The Financial Express
AVIVA TARGETS BIGGER PLAY IN MICROINSURANCE
Madrid: Aviva Life Insurance is aggressively looking at microfinance insurance and aims to garner 10% of new business premium from this segment in calendar 2009.
The company plans to tie up with microfinance institutions (MFIs) in the country and will launch products this year with an emphasis on spouse covers, which will comprise one-third of its microinsurance portfolio.
Monica Agrawal, director, corporate initiatives, said the company has set a target of 2 million policies in calendar 2008.
Distribution and premium collection are the main operational hurdles, she said. The company already has tie-ups with MFIs like BASIX and Arohan in 12 states, and plans are afoot to enter other states.
According to a UNDP study, microinsurance represents an untapped market of $2 billion in India. Microinsurance demand in India has remained low largely because of a severe mismatch between services offered by insurers and the needs of the insured.
At present, microinsurance covers around 5 million people, a mere 2% of the country’s poor.
Source: DNA
The company plans to tie up with microfinance institutions (MFIs) in the country and will launch products this year with an emphasis on spouse covers, which will comprise one-third of its microinsurance portfolio.
Monica Agrawal, director, corporate initiatives, said the company has set a target of 2 million policies in calendar 2008.
Distribution and premium collection are the main operational hurdles, she said. The company already has tie-ups with MFIs like BASIX and Arohan in 12 states, and plans are afoot to enter other states.
According to a UNDP study, microinsurance represents an untapped market of $2 billion in India. Microinsurance demand in India has remained low largely because of a severe mismatch between services offered by insurers and the needs of the insured.
At present, microinsurance covers around 5 million people, a mere 2% of the country’s poor.
Source: DNA
RAISING FDI CEILING KEY TO GROWTH: AVIVA LIFE CHIEF
Madrid: Aviva Life Insurance Managing Director & CEO Bert Paterson said that a delay in liberalising the foreign investment norms for the insurance sector will hit the industry's growth."Life insurance requires an increasing amount of capital for growth. Nearly all the Indian promoters of life insurance companies have core interest in industries, banks and asset management. All these businesses require capital which is scarce.
"The Indian and global markets are getting volatile. Balance sheets of companies are under pressure. Capital availability is getting tighter across the world. With the current foreign investment limit, there is a pressure on the Indian promoter to bring 74 per cent share of the new capital infusion that is required to maintain the fast growth of the life insurance business. With the ceiling not being raised to 49 per cent, there is a risk that the industry will face a capital crunch which could hinder the growth of the life insurance companies," he said at the Aviva Insurance Summit.
Aviva is also planning to launch an asset management company in the country. The insurer had announced its plans last year. "We will bring Aviva's entire capabilities here. Asset management is integral to Aviva's strategy. We are working on the plans and may announce something shortly."
However, he refused to give a definite time frame for the launch. Aviva is one of the largest asset manager in the world with funds under management of euro 316 billion.
Since the insurance sector was reopened to private competition in late 2000, life insurers have invested Rs 10,000 crore to keep capitalising their business and meet solvency requirement.
While the local and international players have been seeking that the foreign investment cap be increased to 49 per cent from 26 per cent at present, the Left parties, which were supporting the UPA till recently, had stalled the introduction of a Bill to amend the Insurance Act. The growth of the life insurance sector has slowed in recent months.
About the impact of slowdown on the valuations of life insurance companies, Paterson said, "Undoubtedly, the current valuations of life insurance companies are unrealistic and driven by the growth in the new business premium. If the new business premium volumes fall, valuations will also fall.
"At present, multiples such as persistency ratio, profitability margins by product are not factored in while arriving at valuations. When a life insurance company gets listed, investors will want to make an informed decision on the stock data. Therefore, the multiples applied for valuing the insurance company will become more realistic and make insurance companies more transparent."
Source: Falaknaaz Syed
Business Standard
FUTURE EYES MALL-BOUND YOUNGSTERS FOR INSURANCE BIZ
New Delhi: Future Group on Wednesday said it is successfully tapping the potential insurance customers among shopping mall and modern retail outlet visitors, besides the traditional channels like agency and branch networks. “By introducing insurance products to customers who are visiting shopping malls and modern retail outlets, we have been able to acquire a significant number of individuals who had never bought an insurance product before,” Future Group CEO Kishore Biyani said.
Source: The Economic Times
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