SBI Life registers Rs 19-crore premium

Chennai: SBI Life Insurance, the 74:26 joint venture between State Bank of India and Cardiff SA, France, has closed its first financial year with a premium income of Rs 19 crore for covering lives for a sum assured of Rs 30 crore. We are planning to declare bonus to our policyholders, says SBI Life managing director and CEO R Krishnamurthy.

The modalities of bonus declaration is being worked out, he says when queried about the additional equity the promoters will be infusing or the amount that will be transferred from shareholders fund to policyholders fund to declare bonus. The company has an equity base of Rs 125 crore.

Krishnamurthy says a major portion of the premium income is earned from selling single premium and policies for children. Currently, SBI Life sells four savings (three single premium and one regular) and two group products with two riders. The company went aggressively selling single premium policies to bank employees opting for voluntary retirement.

We are working on other products like endowment and whole life, says Krishnamurthy. Hoping to break even by the fifth year of operations, he says it depends on the success of the bancassurance model the company has adopted.

The regulations for banks selling insurance products are yet to be in place, disturbing SBI Lifes initial business plan of selling through SBI branches. As a result, the company resorted to the traditional way of selling life insurance policies - the agency route. SBI Life has currently 800 agents.