The Hindu Business Line : Bajaj Allianz net rises on low-cost biz model

Mumbai, July 12 Bajaj Allianz Life Insurance has reported a net profit of Rs 30 crore in the first quarter of 2007-08, against a net loss of Rs 19 crore in the corresponding quarter of the previous year.

The company had reported a profit of Rs 63 crore in the entire 2006-07 fiscal.

Mr Sam Ghosh, CEO, Bajaj Allianz Life, said the profit could be attributed to the company’s low-cost business model.

“We have changed our business mix, with single premium accounting for just 10 per cent of our business. Besides, we do not do group life insurance business, which would have increased our costs,” Mr Ghosh said.

“Significantly, around 65 per cent of the company’s business comes from smaller towns. Hence, our cost of customer acquisition is low,” he added.

In the first quarter of the fiscal, the company’s annualised new business premium grew by 86 per cent to Rs 658 crore. The company issued 5.63 lakh policies, against 2.01 lakh in the previous year.

Mr Ghosh said Bajaj Allianz would be doubling its agency force from 2 lakh to 4 lakh by the year-end. The branch network will be increased from 900 to 1,100.

The company’s capital base stands at Rs 700 crore.

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