IFFCO Tokio General Insurance (ITGI), which is the fourth-largest private general insurer, sees health insurance as one of the key growth drivers of the company in the coming years. Warendra Sinha, Managing Director and CEO, shares the insurer’s plans to grow profitably and spread wings in the country. Excerpts:
What will be the growth driver for the company in the coming years? Will it be motor insurance?
Health insurance will be one of the key growth drivers for the company in the coming years. There is a vast majority that is still deprived of a decent health insurance cover. Home insurance can be another potential growth driver, given the frequent recurrence of natural calamities such as cyclones and floods in major Indian cities and towns. Motor insurance has become a necessary commodity since it brings liquidity and, hence, the only differentiator will be claims servicing.
What are the new products in the pipeline?
There are several new products in the pipeline, such as a comprehensive home insurance, cyber protection and bank-locker protection products.
What is the growth aspiration for ITGI in the current fiscal?
Our aspiration is to grow above or match the industry growth and be profitable at the same. Above all, our primary objective is to be fair to our customers and put the smiles back on their faces in case of an unfortunate event, in tune with the slogans, ‘MuskhurateRaho’ and ‘To be a Good Company’.
What about the outlook for profits? Why did the profits fall sharply to ₹189 crore from ₹427 crore in the previous year?
The sharp drop in our profits in 2017-18 was a result of some large claims in the property and crop businesses. The year 2016-17 was an exception as we took advantage of the favourable market conditions and accounted for a one-time capital gain in our investments. Our focus this year is to execute our restructuring plan to regain the growth momentum.
Last year (2017-18) saw a modest Gross Written Premium growth of 1.26 per cent. Do you expect a sharp bump-up in growth rates this fiscal?
Last year, the modest growth was the result of a conscious decision that we took to have a balanced portfolio. There was de-growth in some of our loss-making portfolios. The market also witnessed some irrational pricing wars, which we deliberately avoided. A semblance of order was restored after the first half due to the regulator’s intervention.
Notwithstanding such uncontrollable challenges, coupled with the fluctuations of the crop insurance, we did a comprehensive review of our business and planned for the way forward this year. We have digitalised our offerings to provide efficient service to our growing customer base.
I am confident that these initiatives will significantly uplift our premium incomes and drive our growth ambitions.
Are you looking at raising capital to fund growth this fiscal?
We have recently had a capital infusion of ₹200 crore to fund our expansion plans.
Will you go in for listing to raise capital or increase visibility of the company?
The decision to list the company is with the shareholders. However, as said earlier, we are well capitalised to embark on our growth journey.
Could you please share the vision for the next decade? Will you look at the inorganic route for growth in the Indian market?
We have a long-term business plan, which has been decided and approved by the shareholders. We are already the fourth-largest private general insurer in India, and aim to maintain our position among the top five private insurers. An inorganic route for growth is not on our agenda presently. However, if an opportunity arises, our shareholders will take an appropriate decision.
What innovative approach are you looking at to expand distribution? Will there be any tie-ups with banks?
We have an omni-channel distribution network to reach and cater to our customers’ preferred options. With the new bancassurance guidelines, we are exploring major banks for a tie-up linked to our need-based products and our wide presence. We have created a separate vertical for bancassurance to drive growth. We have over 200 banks (many cooperative banks) as our partners, who are small as of now, but have the potential to grow. The already existing broker and agency channels will be further strengthened.
What are your initiatives in new technology areas such as Artificial Intelligence, Machine Learning and IOT to serve customers better?
We are using AI chat bots to improve the overall customer experience and enhance the customer journey. Our chat bot Ira is now live on our website to download the motor insurance policy. One can also renew motor policies through this chat bot. We also use AI tools to improve the turnaround time of claims by automated assessment of claims. We have initiated the process to use machine learning tools to ensure paperless claims for motor and health claims and pre-authorisation approvals.