Canara HSBC Oriental Life eyes Rs 850 cr in new business premium

Insurers growing in excess of 30-40% yearly are all backed by bancassurance

With high growth in the past two financial years, Canara HSBC Oriental Life Insurance is targeting 40-50 per cent increase in 2017-18 in new business premium. The target is Rs 850 crore and the hope is for as much as Rs 1,000 crore, said Anuj Mathur, chief executive officer. The company has booked profit over Rs 100 crore annually for three years, with its bancassurance (banks as partners) model. Those with a predominant share of this route incur much lower cost, as they do not have to invest in building infrastructure for an agency network. “Hence, we achieved an early break-even and are generating profits,” said Mathur. 

Insurers growing in excess of 30-40 per cent yearly are all backed by bancassurance, he said. At present, the company is well capitalised, with a strong solvency ratio of 400 per cent against the sectoral standard of 150 per cent, and overall persistency of 83 per cent. The company might think of listing its business on the bourses in three or four years, if the shareholders feel the need to dilute their holding. said Mathur.

At present in the segment, only ICICI Prudential Life is listed on bourses. Two others, SBI Life and HDFC Life, are in line to list their shares in this financial year. ICICI Lombard, a private general insurer, will also be listing shortly. And, two other general insurance companies — GIC Re and New India Assurance — have filed their draft prospectus with the regulator for an initial public offer of equity.