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Mr M. Ramadoss (right), CMD, The Oriental Insurance Company Ltd, and Mr S. K. Chanana, Director & GM, at a press conference in the Capital on Wednesday. - - Kamal Narang

New Delhi , July 6

ORIENTAL Insurance Company Ltd has recorded a net profit of Rs 330.52 crore for fiscal 2004-05 — a 4.43-per cent rise over the previous year's Rs 316.47 crore.

The profit before tax grew 3.82 per cent to Rs 471.70 crore (Rs 454.33 crore).

Disclosing the company's financials for the fiscal ended March 31, 2005, the Chairman and Managing Director, Mr M. Ramadoss, said on Wednesday that the gross premium grew from Rs 2,899.74 crore as on March 31, 2004 to Rs 3,090.55 crore on March 31, 2005 — a growth of 6.58 per cent.

The net premium rose 9.10 per cent in 2004-05 to Rs 2,218.02 crore, from Rs 2,033.03 crore the year before.

Mr Ramadoss said the net premium retention (net to gross) grew from 70.11 per cent to 71.77 per cent. Oriental Insurance, however, showed higher net incurred claims of Rs 1,908.38 crore against Rs 1,587.64 crore — a rise of 7.95 per cent in claims payments.

Mr Ramadoss said the higher claims payout was on account of increase in losses in the fire portfolio where claims grew 19 per cent, health 16 per cent, motor (own damage) 9 per cent and motor (third party) 13 per cent.

The company has admitted that the claims ratio has shown "some disturbing trends" and said these need to be brought under control in the days to come. "The increase in claims in segments such as fire, health, motor and marine hull needs to be arrested," Mr Ramadoss said.

The company has also shown a major increase in commission payments, from Rs 28.90 crore to Rs 84.57 crore. Mr Raj G. Vishwanathan, Financial Advisor, Oriental Insurance, said the rise in commission payments was mainly due to higher payout of direct commission to agents, brokers, corporate agency and referrals.

Mr Vishwanathan said the company's reserves and surplus reached Rs 1,318.61 crore against Rs 1,022.18 crore in the previous year.

On the losses suffered on account of the floods in Gujarat, Mr Yogesh Lohia, General Manager, said, till date, there were 652 claims involving a Rs 14.15-crore outgo. "We are yet to receive any major claims. Most of the claims are small ones such as householders' policies and vehicle insurance," Mr Lohiya said.

Open to IPO

THE Chairman and Managing Director, Oriental Insurance Co, Mr M. Ramadoss, said he was open to the idea of floating an initial public offer.

"I am open to going public," Mr Ramadoss said at a press conference here on Wednesday.

He said Oriental Insurance had already made a presentation to the Government on the company's fundamentals in the context of going public in the future.

He said being listed would help the public sector companies to benchmark their performance vis-a-vis other players through the performance of their stock on the exchanges.

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