The Hindu Business Line : ICICI Lombard grabs 2nd spot in insurance sweepstakes

Bangalore May 31 ICICI Lombard General Insurance Corporation Ltd has raced ahead and grabbed the second spot in the insurance sweepstakes, displacing three public sector companies in the process.

According to figures released by the Insurance Regulatory and Development Authority (IRDA) on Thursday, ICICI has earned a premium of Rs 448.65 crore for April, a 35 per cent growth over the corresponding period of the last financial year. Public sector New India Assurance, however, remains on top with a gross premium of Rs 650.82 crore for the same period. New India has grown by only 8.2 per cent over the corresponding period of the last financial year.

Oriental Insurance Company Ltd remains at the third spot with gross premiums of Rs 413.50 crore. Oriental's growth has remained flat during the period.

Circumspect

But ICICI Lombard Managing Director and Chief Executive Officer, Mr Sandeep Bakshi, preferred to be circumspect. He said, "These numbers are not reflective of any long term trend. Any inference can be drawn only over much longer period."

In the first month of financial year 2007-08, private sector insurers have grown 37.34 per cent to Rs 1,272.22 crore over April 2006. In the process, the market shares have further undergone a change. Private sector has grabbed a market share of 40 per cent in the non-life insurance business, from 34 per cent in the financial year 2006-07. Public sector market share is now only 60 per cent.

The high-speed growth comes at a time, when the domestic markets have been almost completely deregulated. Indications are that the private sector is not only cutting into the public sector, but also snapping up new business opportunities, including retail.

Retail biz

Private sector insurers, like the private sector banks are focussed heavily on retail lines of business. Retail business accounts for at least 55 per cent of the private sector's premium accretions. In the case of public sector, the focus is more on bulk/corporate business.

Industry sources said, the intense competition not withstanding most large corporate renewal business mostly remained with the public sector. It was only the incremental business, in tandem with the growth in the economy that the private sector was capturing.

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