Riding high on motor and fire premia and government-run social security schemes, the #general insurance industry grew 12.5 percent in the April-June quarter mobilising Rs 23,418 crore in premium income. The industry, consisting of 28 players including four public sector players, mobilised Rs 23,418 crore of premia in the first three months of the current fiscal, showing a growth rate of 12.5 percent over the last fiscal, as per the General #Insurance Council data. At 9.5 percent growth in 2014-15, the industry had the lowest growth in recent years.
“The growth revival was backed by motor and health segments which contribute more than 70 percent of the industry portfolio,” General Insurance Council secretary general R Chandrasekaran told PTI. “If the same trend continues, we could see growth continuing the momentum through the rest of the year. But a lot also depends on the monsoon,” he added.
The four public sector general insurers have recorded a growth rate of 11.9 percent in the first three months and thus have scored over their private sector peers who grew a tad lower at 11.4 percent. State-owned general insurers collected Rs 12,430 crore premium, while the private sector earned a premium of Rs 9,733 crore in the reporting period. “It’s definitely a much better than the previous year and even the preceding quarter. I hope the trend will continue as the economy is picking up and rates have gone up in certain areas like fire (10 percent) and #health insurance. Auto sales have also shown good pick-up,” New India Assurance chairman and managing director G Srinivasan said. “While there is some improvement on the front of corporate insurance, we have also seen good growth in the retail segment too,” he added.
The industry has termed the growth in the first quarter as an early sign of revival. “It is an early sign that the industry has come back onto the revival path and I do hope that the industry will be able to rebound. We are dependent on several factors like distributors’ role and improvement in the economy for growth,” ICICI Lombard’s Sanjay Datta said.
At SBI General, we have grown by 30 percent, primarily from health insurance and fire,” SBI General Insurance managing director and chief executive Bhaskar J Sarma said, adding he is hopeful that the year could clip at 40-50 percent.
Retail, which accounts for 65-70 percent of its portfolio now, will continue to be the focus, he added. “The sales of commercial vehicles have been low and hence the industry grew by merely 3 percent over the last year,” Bajaj Allianz General Insurance head Tapan Singhel said, adding, “I do see a modest growth of the industry of 13-14 percent during the remaining part of the year.”
However, Liberty Videocon General Insurance’s Roopam Asthana said pricing is very aggressive and it is not in commensurate with risk and hence it needs to go up.
All the five standalone health insurers at 41.7 percent growth witnessed the fastest expansion in the industry during the reported period. But the two state-owned specialised general insurers, Export Credit Guarantee Corporation and Agriculture Insurance Company at 6.5 percent have registered the lowest growth in the industry, the data showed.