SBI Life Insurance Company's net profit increased 33 per cent to Rs 366 crore in the financial year ended March 31, 2011, compared with the year-ago period.
The total premium income of the company — which is joint venture between State Bank of India and BNP Paribas Assurance — grew by 28 per cent to Rs 12,912 crore.
“The containment of expenses ratio, the growth in the renewal premium and persistency levels were key drivers behind the increased profitability,” Mr M. N. Rao, Managing Director, SBI Life Insurance, told Business Line on Wednesday.
The company had the ‘lowest' expense to gross written premium ratio in the industry at 5.8 per cent, he said.
The agency channel gave a strong thrust to overall business by bringing in 42 per cent of the total premium followed by 37 per cent from bancassurance.
The number of new policies during 2010-11 had decreased to 13 lakh compared with 19 lakh in 2009-10.
On the Unit Linked Insurance Products (ULIPs) segment, Mr Rao said despite changes in regulatory norms in September 2010, his company fares ‘well'.
At present, 69 per cent of total business comes from ULIPs.
However, despite a decrease in the number of policies, SBI Life's new business premium collection increased by 7 per cent at Rs 7,572 crore due higher values of the polices, Mr Rao said.
The growth in renewal business also helped SBI Life as the premium collection under this segment registered a 74 per cent growth at Rs 5,340 cr (Rs 3,063 crore).
The asset under management expanded to Rs 40,163 crore, marking a 40 per cent increase.
In the current financial year, SBI Life is targeting 35 per cent growth in total premium, Mr Rao said.
This will be achieved by, among others, increased focus on the bankassurance channel and expansion in reach by adding 75 new branches to the existing 635 before March 2012.
It also plans to hire about 800 staff. At present, SBI Life has 7,300 on its rolls.