SBI General Insurance, the general insurance arm of the State Bank of India, plans to raise ₹350 crore from its shareholders to fund its expansion plans in FY15.
SBI General Insurance is a joint venture between the State Bank of India and Sydney-headquartered Insurance Australia Group.
“In this fiscal we are targeting 90 per cent growth in premium to over ₹2,000 crore,” said Managing Director and Chief Executive Officer, Bhaskar J Sarma.
The private general insurer’s gross underwritten premium collection jumped to ₹1,200 crore in FY14 from ₹771 crore in FY13, registering a 56 per cent growth. Sarma expects major growth in business to come from the retail and SME segments.
“On the commercial side, we are focussing on credit, fire and marine. Depending on the economic growth, we expect a lot of traction from this line of business,” he said.
Sarma said the general insurer, which is in its fourth year of operations, is cautious in the commercial line of business due to the heavy discounts prevalent in the industry, where insurers want to ramp up their topline.
He expects the company to breakeven in FY15-16. The company posted a loss of ₹98 crore last fiscal against a budgeted loss of ₹88 crore because of the impact of third-party motor insurance pool, added Sarma.
The general insurer plans to enter the crop insurance segment in six districts.
At present, 65 per cent of the overall premium collection for the insurer comes from the bank branches of SBI.