Ageas Federal Life Insurance is hoping to increase its distribution footprint this fiscal with partnerships and tie-ups with banks after IDBI Bank discontinued selling its products.
“For the next three to five years, the aim is to shore up our topline and distribution footprint. That would be through a combination of proprietary channels like agency, group, online and also inorganic play,” said Vighnesh Shahane, Managing Director and CEO, Ageas Federal Life Insurance.
IDBI Bank contributed to about 50 per cent of the topline through its distribution, Shahane said, adding that over the last three years, it had stopped selling the insurer’s products.
The private sector life insurance is hopeful that with the open architecture policy of the IRDAI, it will be able to find a banking partner.
“The inorganic opportunity would be in terms of a partnership or joint venture with a bank for distribution,” Shahane told BusinessLine in a recent interview.
Partnership talks
“We have been in talks for the last three years but most banks already have partnerships. We have to keep talking and waiting for a partnership. Most of the good banks are already taken,” he noted.
Federal Bank, which owns 26 per cent stake in the insurer, has however, stepped up on distribution, Shahane said.
“IDBI Bank has moved out but Federal Bank has grown 40 per cent year-on-year on topline for the last three years,” he said, adding that it however does not compensate for the loss of IDBI Bank.
The insurer is also upbeat about Ageas increasing its stake in the company to 74 per cent. Shahane said it will end the period of uncertainty and also help the company in terms of expertise and domain knowledge as well as improvements in IT and enhancement of customer journey.
“The uncertainty around the company ends. There is a lot more focus from the foreign partner and commitment,” he noted.
He also expressed satisfaction over the company’s performance and noted it has managed to do well despite the challenges from the Covid-19 pandemic.