NEW DELHI: Shriram General Insurance, a joint venture between Shriram Capital and South Africa’s Sanlam Capital, has become a prominent player in the country’s insurance sector. We got in touch with Neeraj Prakash, Managing Director, Shriram General Insurance, to talk about the company’s aggressive expansion plans, key areas of focus and why it will continue to focus on profitability. Edited excerpts:
Your company completed 10 years of operations. How has been the journey?
We started in 2008 and in these 10 years, we have done well in terms of profitability. Last year, we had a PAT of `400 crore and the top line was around `2,100 crore. In terms of profitability, we have become the fifth largest player in the private sector. At present, we are selling 1.5-2 lakh policies per month, besides issuing 2.75 lakh policies for IRCTC per day. Going ahead, we are expecting better results.
Where will your next phase of growth come from?
In the last two-three years, the profitability of the company remained very sound and now we are going on the expansion mode. We will be hiring close to 5,000 employees in the next two-three years. Right now, we have close to 17,000 IRDAI agents. By the end of this year, we want it to reach 18,000 and by the end of next fiscal, we want to have 25,000 agents.
On the network side, right now we have 162 branches. We are planning to have over 200 branches by the end of next fiscal.
Where will be the bulk of your expansion take place?
Our main focus is to get into C and D class cities, particularly in the eastern region where we have less number of branches, as well as Maharashtra and Gujarat. The idea to get into these regions is that most of the people are not having insurance coverage. Also, owing to the small base, small ticket size and difficulty in collecting premium, not many companies are keen to get into these places.
Which segments will be of primary focus for you in these regions?
If these cities, our main focus will be on the motor insurance business where we are already doing well. In the motor business, we will play on commercial vehicles and two-wheelers. The other two areas of focus will be home insurance and business protected policies that we have. Our business protected policy has 10 sections that cover almost everything of small enterprises, be it the building, content, money or money in transit.
Don’t you think the expansion plans can impact your profits?
The industry is growing at a CAGR of 15-20 per cent and we expect to grow at a similar pace. To be true, we are not focusing on the topline, but on the bottomline. That is why our topline is not growing like the bottomline. We are focusing on quality business and we are not into the rat race to sell more policies.