Shriram General to push unique business plan

July 16th, 2008 - 6:54 pm ICT by IANS  

A file-photo of P. Chidambaram

Chennai, July 16 (IANS) 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 busines 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.

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