For Cholamandalam MS General Insurance CEO Arun Agarwal success is a combination of prudence, commitment and hard work

Chennai: "I always wanted to be a journalist but destiny decided otherwise," says Cholamandalam MS General Insurance Company CEO Arun Agarwal, 50. "Maybe I will write a book on insurance."

It is not just journalism that this corporate executive had to forgo after obtaining his post-graduation degree in botany; he had to say no to banking and police service after passing the bank officer's and civil services examinations. Agarwal also had a brush with law - no, not breaking law, but studying it. Why a wide variety? "If I like a subject then I join that particular course; getting a degree is inconsequential."

Perhaps, while studying history as the main subject for the civil services examination, Agarwal developed an inquisitive fascination for dates. While musing over his life and the major turning points it took, he makes it a point to quote the exact dates, not just the year.

The grooming up
Born into a Lucknow middle-class family as the last child after two sisters (his father G P Agarwal was an Uttar Pradesh government employee), Agarwal belongs to the first batch of Assistant Administrative Officers (AAO) recruited by the General Insurance Corporation of India (GIC) for its four subsidiaries.

His batch could very well be termed as 'the CEO batch' as many of his batchmates today head or occupy important positions in several non-life insurance companies within and outside India. After a one-year induction training at GIC, a young Agarwal was allotted to Oriental Insurance Company and was posted at its headquarters in New Delhi.

Those were the days when the four nationalised non-life insurers, formed by merging several private companies, were trying to iron out their varied human resources rules. In 1978, the job of drafting a comprehensive personnel manual for the company became Agarwal's responsibility.

That was also the first time that any government general insurance company was attempting to codify the HR (human resources) rules. One can see pride glinting in his eyes when he talks about the other three companies referred to the Oriental Insurance's HR manual drafting their own manual.

Three years later he was transferred (the first of the many) to Lucknow regional office. From there he was posted as an assistant divisional manager in a divisional office - his first posting in an operational office. He soon came back to the regional office to take care of the region's planning and human resource requirements.

Life was chugging along for this bright officer for some time. In 1983 he married Kavitha, a qualified librarian. They have two daughters: Paridhi, the elder, learning a specialised course to assist the hearing impaired; and Tanaya, now in her tenth standard.

"He is a very understanding person. Though my in-laws wanted me to quit my job as ours was a joint family, my husband asked me to continue with it," says Kavitha. Four years later she voluntarily quit her job to accompany Agarwal when he decided to go to National Insurance Academy, then in Mumbai, as a research associate.

Climbing the ladder
That stint gave him immense satisfaction as he was able to pursue yet another of his liking - research. He focused his research on private car accident repairs management. "That gave me a deep insight into motor insurance in India," he says.

The subsequent stint as the divisional manager in Lucknow prepared him to target mega projects for insurance. "I decided to take the technical route to attract big industrial projects as that would result in carving a deeper relationship with clients."

One such project was the Feroz Gandhi Unchahar Thermal Power Station in Uttar Pradesh. When he joined the division, Oriental Insurance was having a 60-per cent share in the power station's insurance business. Gradually he increased it to 75 per cent and finally to 80 per cent.

The big turning point in his career and which made him the company's shining star was his promotion as the senior divisional manager and the posting at Divisional Office 18, Mumbai. That was when he started dealing with mega industrial groups like Reliance and their giant projects. He increased the divisional office's premium income to Rs 13 crore from Rs 7.5 crore in a short span of time.

Following the strategy he adopted in Lucknow, he cemented the relationship with Reliance to bag the mandate to insure the company's global size refinery project at Jamnagar, Gujarat. "I wrote India's largest Advance Loss of Profits Policy and Marine-cum-Erection Policy," he recalls with pride.

He not only underwrote the huge policy; Agarwal also gained the experience of dealing with huge claims. In 1998, the Reliance refinery was extensively damaged due to floods and Oriental paid the first instalment of Rs 30 crore.

Says H Ansari, chair professor (General Insurance), National Insurance Academy and former director and general manager, Oriental Insurance, and Agarwal's mentor: "Apart than bagging big insurance accounts, Agarwal is an upright person and is among the finest officers at Oriental Insurance."

With the winds of liberalisation starting to blow in the financial services sector and more particularly in the insurance industry, Agarwal decided to join the American Insurance Group (AIG) and later Tata AIG General Insurance where, along with his batch mate and CEO Dalip Verma, he built a good team.

Sweetening challenges
And April 2002 saw him joining Cholamandalam MS General Insurance, which by then secured the principle clearance from the Insurance Regulatory and Development Authority (IRDA). "It is the challenge of building a team that attracted me than the position." Agreeing that the company is a late starter, he says: "That is why we decided to have the entire suite of products on day one itself."

Last year the company clocked a premium of Rs 14 crore and for the current fiscal Agarwal has an ambitious target of Rs 120 crore. Discounting any talks about achieving the target by tapping the group's insurance business, he says: "The group's annual insurance pay-out will not be more than Rs 15 crore."

As a strategy the company will be targeting the 200-odd Japanese and Korean companies operating in India. "Towards that end four officials from the company's joint venture partner have been deputed here."

Terming the fixing of non-life insurance premium rates by the Tariff Advisory Committee (TAC) as not in sync with liberalised market, Agarwal says: "Very few countries follow a tariff regime. Each company should be allowed to fix their own premium rates based on the claims experience and market forces. One should follow the concept of merit rating."

Agreeing with Ansari's views about his chief executive, Satish Deshpande, head (claims and reinsurance), says: "The soft-spoken Agarwal achieves his target by delegating work." Ask Kavitha about her husband, and she would say: "Years ago he used to be short-tempered; now he isn't." Perhaps practising yoga for the past 20 years helped Agarwal to overcome that - it also trimmed him physically.

Home, sweet home
As a doting father, Agarwal gives too much freedom to his daughters, much against Kavitha's comfort levels, and allows them to take decisions after explaining the pros and cons of an issue. A homing pigeon, Agarwal loves to spend time with his family and watch light-hearted Hindi movies featuring his favourite hero Govinda. "He would not risk himself to view some serious stuff."

But deep down in Agarwal's heart lies his desire to do something concrete for the underprivileged in the society. "I am sure after fulfilling his duties he would devote some time and effort towards that. It is this idealism that makes me love him more," says Kavitha. Agarwal, in the meantime, contributes handsomely to Child Relief and You (CRY) and old-age homes.