Canara Bank to enter health cover products

Bangalore-based public sector lender Canara Bank plans to start distribution of health insurance policies. The bank plans to enter into a distribution agreement with one of the top four health insurance players in the country.

"The Insurance Regulatory and Development Authority (IRDA) recently permitted banks to enter distribution of health insurance policies. We will announce our tie-up with one of the health insur-ance firms within a month," R K Dubey, chairman and managing director, Canara Bank, said.

He said, the bank is already active in the distribution of general insurance. The bank, on Monday, entered into a memorandum of understanding with United India Insurance (UII) for distribution of UII's general insurance policies.

Dubey said the bank would announce the new tie-up very soon. With this, the bank will have all types of insurance products under its portfolio. It already has a joint venture with HSBC and Oriental Bank of Commerce for life insurance.

"Presently, our fee-based income from the sales of insurance policies is to the tune of Rs 15 crore. With our new tie up with United India, we are looking at an additional fee-based income of Rs 50 crore during the current year. This is possible as we have a large network of branches and we are also exp-anding our branch network in the next two years. We have also launched an exclusive portal jointly with the United India to help our customers to buy insurance products online," Dubey said.

As part of the tie up, United India would utilise the services of Canara Bank's large network of Business Correspondents (BCs) to provide micro insurance products to the uninsured rural population. United India will impart training to the BCs in this regard and also leverage technology by providing them the web portal facility.

The bank plans to open 500 new branches during the current financial year. Over a period of next one and a half year, the Bank plans to achieve a milestone of 5,000 branches. Currently, it has 3,800 branches. "We are specifically looking at expanding our branch network in the northern, eastern and western parts of the country. We have taken approval from RBI to expand our network," he said.

Dubey said the Bank also plans to open a branch in Johannesburg in South Africa and Frankfurt in Germany by end of March 2014. "We have approval from Reserve Bank of India and Central banks in these two countries to open overseas branches," Dubey said.

Canara Bank has a total business of Rs 6,32,000 crore.