The Hindu Business Line : Birla Sun Life plans aggressive growth

NEW PRODUCT: Mr Vikram Mehmi (left), President & CEO, Birla Sun Life Insurance, and Mr Fabien Jeudy, Vice-President Chief Appointed Actuary, at a press conference to launch the children's dream plan in Mumbai on Monday. - Paul Noronha

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Mumbai March 5 Birla Sun Life Insurance hopes to grab a fair share of the growing insurance market and be among the top three in two years.

Mr Vikram Mehmi, President and CEO, said that the accent would now be on aggressive growth.

"The life insurance industry is growing at 100 per cent. We plan to introduce innovative products and expand our channel reach," said Mr Mehmi, who took over as CEO in December 2006. He was earlier CEO of Idea Cellular.

The company has registered 40 per cent growth in new business premium to Rs 579 crore in the first 10 months of the fiscal, against Rs 414 crore in the previous year.

On lower rate of growth when compared to other insurance companies, Mr Mehmi said: "To a certain extent it was a conscious decision, since other companies do not have many long-term products. Besides, there has been a change in the leadership of the company."

In terms of maturity value, most of Birla Sun Life's products have a term of 15 years, said an official.

The company is exploring distribution tie-ups with other companies in the Birla group, Mr Mehmi said.

"We will evaluate all the opportunities we have to build synergies among the group companies and try to evolve a low-cost distribution model."

Currently, the company has a tie-up with Idea Cellular to offer group term insurance cover for subscribers aged 18-35.

It is in talks with non-life insurance companies to design a composite micro-insurance product.

Mr Mehmi also said that the company's average premium per policy was close to the industry average of Rs 20,000.

It is likely to be lower in the future as insurers reach out to smaller towns and lower income groups.

On breaking even, he said that if the company had to grow, break-even would have to be postponed.

On Monday the company launched the `Children's Dream Plan,' a unit-linked insurance plan with guaranteed maturity benefits.

The plan combines a guaranteed return on savings with upside potential based on the performance of the investment funds.

The policy administration charge is customised and is deducted on a monthly basis.