Iffco Tokio eyes 65% income from retail

Iffco Tokio General Insurance company (ITGI) is aiming to increase premium income from its retail business to 65 per cent of the total income in 2006-07 from 52 per cent in 2005-06.

In its retail portfolio, ITGI has motor insurance, travel insurance, health insurance, home and family insurance and trade and protector insurance policies for the SME sector.

Among these, motor insurance contributed 40 per cent of the total premium. The company now plans to consolidate motor insurance business and expand its home and family insurance and trade and protector policies to 15 per cent of the total retail portfolio from the current 7 per cent to 8 per cent.

For this, the company will tie up with more small banks and co-operative and regional banks to set up its base besides opening 50 new sale outlets by the year end. Currently, it is in deal with 22 small banks.

"There are several agencies who are lending to the small and medium businesses in a big way and helping them to set up their industry base in small towns. We are deeply involved in training them, marketing our products and servicing them. Through the various co-operative bodies, we are targeting small businesses to build up volumes. That is our major area of focus and we aim to develop this much further," said Ajit Narain, CEO and managing director, ITGI.

ITGI will file package policies for individuals and SMEs with the Insurance Regulatory Development Authority of India shortly.

"Though we already have package policies for individuals and SME segments, we are working on developing much more simpler, customer friendly and cost effective package polices as a customer wants a simple package policy that covers all risks such as house burglary, fire and motor car under a single policy. But a challenge here is that it should be IT driven and should deliver when you need it the most," added Narain.

The company has recently started catering to multi modal transport operators, coastal shipping, small aviation and jewellers block. The company achieved a gross premium of Rs 896 crore for 2005-06 as against Rs 501.2 crore in 2004-05, thus achieving a growth rate of 79 per cent.

It has sold 15 lakh policies and settled 140,000 claims with an average claims settlement ratio of above 90 per cent. Its current capital base is Rs 220 crore after an additional capital infusion of Rs 120 crore in 2005-06.

For the year ended March 2006, the company's market share is 4.5 per cent compared with 2.8 per cent in 2005.