Cholamandalam MS targets Rs300 crore premium

Chennai: The city-based non life insurance company Cholamandalam MS General Insurance Company Limited is targeting a premium income of Rs300 crore and a net profit for this fiscal.

Last year the company closed its books with a premium income of Rs170 crore and a net loss of Rs3.3 crore. "The Murugappa group business accounts for 4 per cent of the premium income," says managing director Arun Agarwal. According to him, the company has good renewal ratio in the case of commercial segment but not so in respect of retail business. Nearly 40 per cent comes from retail segment and the balance is contributed by commercial segment.

According to Agarwal, the company present capital base of Rs142 crore is sufficient for its current business plans and there is no need for additional capital infusion.

Reluctant to share operational numbers, Agarwal says, the recent floods in Gujarat, Mumbai, Bangalore and Chennai has resulted in a spate of claims for the company.

Welcoming the Insurance Regulatory and Development Authority's move towards a free pricing regime, Agarwal says that Cholamandalam MS is gearing itself to meet the challenges and opportunities of detariffed market.

"We would like to ensure that de-tarifing includes all classes of insurance and the entire market must be free from the tariff regime," he adds. It may be recalled the IRDA has laid out the roadmap for de-tariffing only in the case of non motor insurance lines. He also favours capping of motor insurane third-party liability at Rs5 lakh instead of unlimited liability as it exists today.

Meanwhile the company has launched a new policy targeting the hotel industry. Called Chola Hotel Insurance, the policy covers different risks classified under two broad categories viz., hotel's liability (towards the guests, their property, liability towards food and beverage supplied by the hotel, use of hotel's swimming pool and other facilities) and the hotel's property like building, furniture, equipments and others.