Pvt insurance cos target growth with new strategies

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Mumbai: After witnessing a downturn in their business in 2008-09, private sector life insurers are now targeting growth for 2009-10 with a set of new strategies.

SBI Life MD and CEO US Roy said, “It is true that customers are not investing due to the slowdown. In fact, this why we are likely to close 2008-09 with a total premium growth of not more than 20-25% compared with a growth of 90% a year ago. We are hopeful to achieve the same growth during the current fiscal.”

In new business premium, the second largest private sector company is likely to touch Rs 5,250-crore mark during 2008-09 compared with Rs 4,800 crore earning a year ago. “We have to build up our health and micro-insurance products in a more aggressive way this year,” Roy added.

ICICI Prudential Life executive director B Bhargav Dasgupta said after the explosive triple digit growth that the industry has witnessed in the past years, there has been a slowdown to an extent. “For us, over 90% of the inflows are still Ulips. This clearly indicates that investors have realised the long-term potential of the product. The growth prospects of Ulips remain intact. While the current volatile phase might have short-term impact, the sector’s medium-term as well as long-term growth prospects rest on strong fundamentals of economy as well as sound regulatory framework. We have witnessed a strong growth of 75% in our renewal premium last year, reflecting the long-term sustainability of the business,” he said.

Reliance Life Insurance CEO P Nandagopal said, “The year 2008-09 was good for the company as it has done the new business premium (NBP) of more than Rs 3,500 crore compared with the previous year’s mark of Rs 2,751 crore.” He added, “We are hopeful of doing well this year, too, though the growth may be slow until September, thanks to the GDP growth rate being down and slow recovery during the period. But I am confident that our growth will pick up from October onwards.’’

The company has been relying more on Ulip products, which comprise 95% of its offerings.

“However, the ratio may be tweaked to a little extent and Ulip may come down slightly to 90% going forward. We don’t see much difference during this fiscal as customers are moving away from traditional products,’’ he added.