Being friendly with customers as well as investors
31 May 2004
Insurance is nothing but a contract or promise. How well an insurance company honours the promise determines its customer-friendliness; how the company rewards shareholders determines its business expertise.
Balancing the two is a delicate art, which the Pune-based Bajaj Allianz General Insurance Company Limited handles with consummate ease. The company has a settlements ratio of around 94 per cent — possibly, the highest in the world — and its 20 per cent return on equity ranks the highest amongst private non-life insurers in the country.
Four years after opening up the non life sector, the private non life insurers have captured 14 per cent market share in the Rs16,000 crore market.
"Private companies have proved that they are here for the long haul, which is evident in their network and strong business volumes," says Kamesh Goyal, CEO, Bajaj Allianz General Insurance Company Limited.
According to Goyal, the pace of growth will continue to grow in the coming years as private insurance companies gain acceptance and their market penetration expands. For instance, Bajaj Allianz booked gross premium of Rs480 crore during the year ended March 31, 2004, earning a net premium of Rs286 crore — up from Rs299 crore and Rs180 crore respectively in the previous year.
However private companies have not been able to make noticeable inroads into the corporate insurance market, in which the public sector insurance companies have a near monopolistic hold. Many private companies had pinned their hopes on broking houses to procure business for them from the corporate segment. But they have been unable to attract corporates away from the public sector insurance companies.