Money & Banking

Future Generali eyes 25% growth on economy pick-up

NS Vageesh Mumbai | Updated on January 23, 2018

KG Krishnamoorthy Rao

General insurer seeks higher cap on agent commission

Future Generali India Insurance Company, a joint venture between retail giant Future Group and Italian insurance major Generali, expects to post a 20-25 per cent growth this fiscal, said the company’s MD and CEO KG Krishnamoorthy Rao.

This will be well above the expected general insurance industry growth of about 15 per cent this fiscal, he added.

Last year, the company grew at 14 per cent even as the sector recorded its slowest growth in several years, at 9 per cent.

The pick up in the economy and a couple of regulatory changes are expected to usher in faster growth this fiscal, Rao said.

This is contingent on auto sector sales reviving, since motor insurance premium contributes about 55 per cent of the company’s revenues.

Profit rise

Last year, Future Generali had recorded a 50 per cent jump in profits at ₹60.9 crore on a gross premium income of ₹1,480 crore.

Solvency ratios are comfortable and there is no immediate requirement to infuse capital, Rao said.

He expressed hope that insurance regulator IRDAI will lift the current cap on commission payable to intermediaries to reflect current realities.

Even limits such as the minimum claim amount up to which an independent surveyor is not required, has remained fixed at ₹20,000 for very long now. These need to change and an upward revision would actually help the industry and customers complete claim settlements quickly, he said.

Rao also called for a standardised approach to providing awards/compensation for road accident victims.

Currently, courts award different amounts based on similar criteria and it becomes very difficult to price products given this uncertainty, he said.

Besides, the lack of any time bar for filing third-party claims often creates problems, Rao said, adding that there is a need to limit both the time within which a claim can be made as well as the amount.

Unlimited liability

India is one of the few countries that still has unlimited liability for insurance companies, he said, while hoping that this will change when the new road transport and safety laws come into effect.

Nearly five lakh road accidents take place a year in India, of which about 25 per cent are fatal.

Published on July 30, 2015

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