Bajaj Allianz Life looks at new bank tie-ups to boost growth

At present, it only has a tie-up with Dhanlaxmi Bank as a bancassurance partner

Bajaj Allianz Life Insurance is looking to tie-up with more number of banks to boost business growth. At present, they only have a tie-up with Dhanlaxmi Bank as a bancassurance partner.

Anuj Agarwal, MD & CEO, Bajaj Allianz Life said, "We are looking for more partnerships with banks to sell individual life insurance policies. Banks are engaged in the process of talks and developing tie-ups," he said. The insurer has completed 15 years of inception today.

In October 2015, the insurer had announced that they have tied-up with Dhanlaxmi Bank have tied-up for the latter to become a corporate agent of the insurer. As part of the agreement, the bank will continue to be a corporate agent for nine years and sell life insurance products of Bajaj Allianz Life Insurance. Dhanlaxmi Bank has been a partner of Bajaj Allianz Life Insurance since 2009.

With two large life insurance companies, HDFC Life Insurance and Max Life Insurance planning to merge, the stage is set for consolidation in the insurance space. Agarwal said that while it was believed that mergers and acquisitions will begin from smaller players getting together, but the proposed merger of two large player shows the requirement to increase the asset rise.

"Their combined asset size post merger will be more than Rs 1 lakh crore. Our asset size is currently at Rs 45,000 crore. If there are smaller players who are available or even others; there have been some banks who had initially entered the insurance industry and not making too much profits. If there is a possibility, it will be a good opportunity for us," he said.

Bajaj Allianz Life Insurance saw a13.4 per cent growth in Rated New Business premium in Q1 (YTD). Agarwal said that they expect nearly 40 per cent growth in Rated New Business premium for the whole fiscal (FY17).

Overall, Agarwal said that the outlook for the industry is positive. Insurance awareness has improved. He said that while overall the insurance awareness has gone up, it still remains a push product.

With respect to the product mix, Bajaj Allianz Life said that the share of unit-linked insurance products (Ulips) is at 60 per cent while the rest constitutes traditional products.

"We are comfortable with a 50-50 mix, but in the end it all depends on the customer and what they want to buy," he said. With respect to expenses, Agarwal said that they had among the largest expense reduction in the industry and said that they are doing well with respect to the expenses of management which have been well managed.