Money & Banking

In H1, United India tops public sector non-life insurers in premium income growth

| Updated on: Nov 01, 2016
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Entry into new segments, revision of premium help boost revenues

United India Insurance (UII) said entry into new segments and strengthening of existing businesses helped the non-life insurer achieve the highest growth in premium income among public sector players during the first half of this fiscal.

UII topped the table among the public sector units with ₹1,797 crore of gross direct premium underwritten (GDPU) in September this year, over twice that of ₹875 crore in September 2015.

Also, in the first half, the company recorded the highest growth (among PSUs) of 27 per cent in GDPU at ₹7,650 crore, compared with ₹6,034 crore in the year-ago period.

The company attributed the impressive performance to its recent entry into two new segments —agriculture (crop insurance) and automobile. Also, restructuring of premium rates, aimed at boostin the bottomline, and limiting discounts in the motor segment, helped the company.

Crop insurance

“We entered the agri sector under the Pradhan Mantri Fasal Bima Yojana crop insurance scheme. We have got around ₹800 crore in a few States. Since kharif is over, we are now trying for the rabi season, for which tender is on for many States and we are bidding for the same,” A Hoda, Chairman and Managing Director (Officiating), UII, told BusinessLine .

The company has firmed up its premium rates and conditions in order to shore up its bottomline. “We are not doing it at loss any more. Since we have got enough market share, we revised our premium rates that are sustainable. In this process, in spite of losing some premium in the beginning, we have been a gainer,” he added.

UII has decided to limit its discounts in the motor policy segment, which has lately seen stiff competition. Though there was some loss of premium initially, the company managed to firm up motor premium rates.

The company’s tie up with Maruti a year ago has also been giving some business in the recent months.

After testing the standards of UII, Maruti started giving more areas to UII from June onwards. The States include Tamil Nadu, Kerala, Gujarat and Uttar Pradesh. “We are getting, on an average, ₹1 crore per day through this pact,” said Hoda.

Amid intense competition and rejig in rates, the company is maintaining double-digit growth in motor and health segments.

While topline growth is expected to be robust, UII expects bottomline to show improvements from the third quarter of this fiscal as the first half will have higher provisioning. “Our annual results will be much better than that of last year,” he added.

Published on January 15, 2018

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