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Outpacing the industry's growth at 11 per cent during nine months to December 2020 amidst the pandemic, Max Life Insurance hopes to post even better numbers at the close of 2020-21 on the back of strong distribution network and digital expansion, the company's top official said.
Max Life outperformed the private sector life insurance industry as well as top-three private players in the first nine months of 2020-21, wherein top-10 private players de-grew by 5 per cent.
"At the end of nine months of this fiscal, we have grown at about 11 per cent. And, we hope that the number will get accelerated further. We are expected to grow higher than 11 per cent (by the end of March 2021)," Max Life Managing Director and CEO Prashant Tripathy told in an interview with PTI.
Max Life's new business premium (on an annual premium equivalent basis) grew 11 per cent to Rs 3,040 crore during the April-December 2020 period, compared with Rs 2,740 crore in the year-ago period.
Besides, the company's private market share also grew 158 basis points to 11 per cent.
"We have gained substantially more than everybody else and this is our highest market share in many years," Tripathy said.
On asked about what caused the company's strong growth numbers, he said, "I think (it is because of) strong execution of our strategy, strong distribution network in our partnership channels (predominantly Axis Bank and also Yes Bank), and our own channels. All of them contributed to kind of growth (we achieved), all of them performed well."
He added that the company's distribution network, its execution level and the response to the COVID-19 pandemic situation (quickly adopting to digital scales), among others, also contributed to growth.
Max Life launched products with COVID-19 conditions, critical illness riders as well as group solutions apart from ULIP (unit-linked insurance products) and all worked well, said the company's chief executive officer.
Tripathy said digital is the way forward as during COVID-19 times, that was the way to move ahead.
"I think digital is the way forward. For a large organisation, it is extremely important to remain close to customers during COVID-19 times. You make extra efforts to remain in touch with the customers, serve the customer, digitise the customer, continue to communicate again and again. So, that has helped us," he added.
The insurer has a long-term association of over a decade with Axis Bank as a bancassurance partner. It also extended for five years its partnership with Yes Bank in April last year.
During the nine months of 2020-21, Max Life's 69 per cent of the business came through bancassurance partnership, while 30 per cent constituted as proprietary channels.
Axis Bank also holds about 1 per cent stake in Max Life, apart from being its biggest banking channel partner for distribution of insurance products. It is slated to increase to about 19 per cent as per a deal signed between the two entities.
Though the deal has been approved by the Competition Commission of India (CCI), insurance regulator Irdai is yet to clear it.
Whether the deal is expected to be closed within this fiscal, Tripathy said it is an internal process at the end of the regulator.
"They should be critically looking at our proposal. I think the regulatory process will take its own time," he added.
On the government's proposal of hiking foreign direct investment (FDI) in the insurance sector to 74 per cent from the current 49 per cent, he said that by giving more opportunity to foreign investors, the market will become deeper and transparent. He also added that it will provide much-needed capital for expansion and it will do overall good to the industry.
"So, I am optimistic it will bring the much-needed capital in the country for growth. What happens is that when the capital comes, even if comes to the industry or the Indian promoter, they start making investment in other areas also. So, it has a domino effect for growth, which is really good," he said.
Tripathy said that as far as Max Life Insurance is concerned, the company's overall shareholding is not expected to see any significant change. "But, I think overall, the interest in the company will go up."
Max Life, ranked No. 4 among private players, registered a 35 per cent rise in net profit to Rs 417 crore in the nine months of 2020-21. Gross written premium were up by 16 per cent at Rs 11,912 crore, assets under management (AUM) grew by 23 per cent to Rs 84,724 crore.
It sold 4,32,000 policies during the April-December 2020 period, up by 5 per cent from the year-ago period.
Tripathy said the company will continue to look for worthy partnerships in future as well.
"We will look at partnerships with new-age technology companies in the digital ecosystem. We are also looking at partnership by promoting our accelerator programme. We have launched two programmes where we ask new-age companies to work with us," he said.
Part of India's Max group, Max Life is a joint venture between Max Financial Services Ltd and Japan's Mitsui Sumitomo Insurance Co. Ltd.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
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First Published: Sun, February 21 2021. 14:57 IST