United India Insurance Company has registered a 28 per cent growth in gross premium income at Rs. 8,179 crore for the year ended March 31, 2012 against Rs. 6,377 crore in the previous financial year. Addressing presspersons here on Wednesday, G. Srinivasan, Chairman-cum-Managing Director said the company was able to maintain its high growth momentum for the fourth year in succession due to a significant rise in staff productivity, reduction in claims ratio and a drop in management expenses.
The accretion in gross premium income was Rs. 1,802 crore against Rs. 1,138 crore in the previous year. The net earned premium registered a growth of 30.97 per cent at Rs. 6,087 crore against Rs. 4,648 crore helping the company to increase its market share to 14.93 per cent from 14.46 per cent in previous year, Mr. Srinivasan said. The company reported a net profit of Rs 387 crore against Rs. 130 crore in the previous year.
The company could reduce the claims ratio to 88.5 per cent from 94.36 per cent in 2010-11, despite making a provision of Rs. 1,075 crore for motor third party pool claims as per the directives of the Insurance Regulatory and Development Authority. Even though the insurance regulator had allowed amortising the losses in the next two years, the company had made additional provision during the year under reference. There was still a balance of Rs. 500 crore to be amortised in the next two years, Mr. Srinivasan said. The company hoped to break-even under this account in the next two years. United India continued to enjoy strong fundamentals with a solvency ratio of 2.71 (against a regulatory requirement of 1.30). In the previous year, the solvency ratio was 2.89.
The company announced a dividend of 52 per cent against 20 per cent paid in the previous year.
Income from investments stood at Rs.1,692 crore and the market value of investment portfolio was Rs.17,100 crore.
The company is optimistic of comfortably crossing a premium of Rs.10,000 crore in the current fiscal by continuing its thrust on retail, MSME (medium and small medium enterprises) and rural sectors.
There was still a huge potential to be tapped in bigger towns and villages, the CMD said. Besides offering insurance products online, the company would continue its focus on agency model to tap these markets. It had already entered into tie-ups with some public sector banks to distribute its products and the services of the business correspondents of these banks would also be used to tap the rural markets, Mr. Srinivasan said.
Keywords: United India Insurance performance