DFS secy asks PSU insurers to boost profits, strengthen retail business

Reviewing public sector insurers' performance, DFS Secretary M Nagaraju urged a sharper focus on profitable business, lower loss ratios, stronger retail portfolios and faster digitalisation

The Department of Financial Services (DFS) Secretary M Nagaraju on Tuesday emphasised the need for public sector insurance companies (PSICs) to focus on increasing profitable business, reducing loss ratios and strengthening retail portfolios, while maintaining their market presence, during a review meeting of the sector’s financial and business performance.

 

Which insurers’ performance was reviewed by the DFS?

 

The meeting, chaired by Nagaraju, reviewed the performance of PSICs for FY2024–25 and the first half of FY2025–26. The insurers reviewed included the Life Insurance Corporation of India (LIC), General Insurance Corporation of India (GIC Re), New India Assurance Company Limited (NIACL), National Insurance Company Limited (NICL), United India Insurance Company Limited (UIICL), Oriental Insurance Company Limited (OICL) and Agriculture Insurance Company of India Limited (AICIL).

 

What strategic priorities did the DFS flag for PSICs?

 

During the review, the DFS Secretary underlined that PSICs must recalibrate their business strategies to prioritise profitability without compromising market share. He stressed the importance of lowering loss ratios, especially in the general insurance segment, and called for a consistent push to expand and deepen retail insurance portfolios, which provide stable and diversified revenue streams.

 

How did Nagaraju address product innovation and emerging risks?

 

Nagaraju also highlighted the need for insurers to develop new, innovative and customised products, particularly to cater to the evolving requirements of the younger generation. He noted that insurance companies must proactively address emerging risks, including those arising from changing lifestyles, climate-related events and new economic activities.

 

What was discussed on technology adoption and digitalisation?

 

Also discussed during the meeting was technology adoption and digitalisation. Nagaraju urged PSICs to move towards end-to-end digital processes, with a specific target of achieving 100 per cent digital onboarding of retail insurance products.

 

Why did the DFS stress communication and outreach?

 

He further stressed the importance of communication, publicity and outreach to improve the visibility and perception of public sector insurers. He encouraged companies to leverage multiple platforms, including social media and digital channels, to engage more effectively with customers and build stronger brand recall.

 

Which insurers’ performance was specifically appreciated?

 

Appreciating the performance of the Life Insurance Corporation of India, Nagaraju noted the insurer’s progress in its journey towards improving profitability. He also commended LIC for the successful expansion of its Bima Sakhi initiative, which aims to enhance insurance penetration, particularly in rural and semi-urban areas, by empowering women as insurance agents.

 

The Secretary also appreciated the Agriculture Insurance Company of India Limited for achieving a significant milestone by crossing Rs 10,000 crore in premium collection during the current year, reflecting the growing scale of crop and agricultural insurance coverage.

   

What did the DFS say on customer service and grievance redressal?

   

Emphasising customer service, Nagaraju said that PSICs must accord high priority to the timely resolution of public grievances and ensure seamless and prompt claims settlement, which he described as critical to building trust and confidence among policyholders.