Leading private insurer Reliance Life Insurance has recorded a 56 per cent surge in its new business premium income in the first nine months of this fiscal and expects further growth in the current quarter.
Helped by a significant increase in individual insurance segment, Reliance Life saw its new business premium collection rising to Rs 1,424 crore during April-December period of 2013-14, from Rs 911 crore in the year-ago period.
For the entire life insurance industry, new business premium income grew by 22.5 per cent to Rs 84,726 crore during the April-December period of this financial year, from Rs 69,184 crore in the year-ago period, according to regulator IRDA (Insurance Regulatory and Development Authority).
The total income, comprising new business and renewal premium collections, grew by 10 per cent to Rs 2,976 crore in this period for Reliance Life, which is part of Anil Ambani- led Reliance Group's financial services arm Reliance Capital. "Challenging market conditions notwithstanding, we have registered a robust growth in new business income during April-December period of the current financial year.
"We aim to drive growth further with a focus on traditional products, agent productivity and improved quality of business, which is reflected by way of increased average ticket size," Reliance Life CEO Anup Rau told PTI. The average ticket size of the company also improved by 33.3 per cent year-on-year to over Rs 20,000.
Its profit for the nine-month period of this fiscal stood at Rs 219 crore, up from Rs 90 crore in the same period of previous fiscal 2012-13.
"We expect to continue with improvement in productivity and sustain the growth trend in new business premium in the current quarter as well," Rau said.
The renewal collection of the company fell to Rs 1,552 crore during April-December of 2013-14 from Rs 1,854 crore in the corresponding period a year ago.
To enhance renewals, Rau said, Reliance Life is taking several initiatives ranging from incentive programmes to overall process re-engineering.
"We expect to see positive results in coming months," he said, while adding that stringent checks have been put in place to control the quality of business being accepted.
The company's total funds under management stood at Rs 18,073 crore as on December 31, 2013.
When asked whether the new product environment and slow economic growth will impact the life insurance business, Rau said: "I am optimistic in the long run. I believe that most of the regulatory changes will pave the way for sustainable growth of the industry in the long-term.
"However, in the short-to-medium term, the industry will have to go through the pains of adjustment. It is a challenging time not just for the life insurance industry but also the economy.
"If you look at the number of uninsured and under-insured in the country, the long-term perspective is very positive. We are confident of a sustained profitable growth for the company in the year ahead."
Reliance Life, a leading player with private sector market share of 6 per cent, has launched over two dozen new and revised products (as per new regulatory guidelines) since January 1, 2014.