State owned insurance major United India Insurance Company (UIIC) is going countryside to shore up its business fortunes. Realising the potentials in the small towns and rural areas, the company is hiring 10,000 business correspondents. The company also plans to hire 25,000 additional agents.
Taking the insurance sector at the doorsteps of customers, it is setting up information and transactional kiosks across tier II and tier III cities to facilitate business where the company does not have a presence, says G Srinivasan, the chairman-cum-managing director of United India Insurance.
?Typically kiosks will be similar to bank ATMs. Since we have operational tie-ups with ten-plus large banks and co-operative banks, we are exploring the possibility of sharing ATMs of those banks in rural areas. We are in talks with a few banks on this, however, on a pilot basis we starting the project at our head office in Chennai,? says Srinivasan.
The company had bagged the mandate to provide insurance cover to people under Tamil Nadu government?s new scheme and is betting big on business correspondents to take the business to smaller towns and rural areas. ?The company will hire 10,000 business business correspondents who are already into financial inclusion works of the banks. They can also double up as insurance agents and earn extra income,? he said.
United India has also firmed up plans to launch insurance literacy programmes in 75 schools across the country. It will also adopt 10 villages to spread insurance coverage.
While its major thrust will be on retail portfolio, the insurance company will focus strategically on micro, small and medium enterprises and rural segments in a big way. It will be opening about 300 micro offices in Tier III towns and would increase its agency force to 75,000 from the current 50,000.
The Chennai-headquatered company had reported a 21% jump in its proft after tax (PAT) to R192 crore for the first quarter as against R159 crore it logged in the same quarter in the previous fiscal. The company?s premium income has grown by 20% to R2,428 crore from R2,022 crore, with an accretion of R406 crore. It mainitained the claims ratio at 83% in the first quarter, which resulted in substantial reduction in the combined ratio to 108% from 113%.
?The insurance company has come out with good performance in the first quarter riding on improved underwriting profitability and reduced management expense ratio, which denotes higher productivity of per employee against transactions,? he said.
The investmnet income of the company stood at R378 crore while the market value of total investment portfolio at end of first quarter was at R17,929 crore against R16,291 crore last year. On capital raising, Srinivasan said the company is fully capitalised with a solvency ratio of 2.84 against the regulatory requirement of 1.40.