New India Assurance, the country’s largest non-life insurer, is planning to come out with householder insurance products

HOPING FOR TAX BREAKS

New India mulls householder products

TNN & AGENCIES 

Mumbai: New India Assurance, the country's largest non-life insurer, is planning to come out with householder insurance products in anticipation that the government might come out with some kind of tax breaks. 
    "We are coming out with simple, easy to understand policies for households as we expect that there could be some tax breaks in the budget," said G Srinivasan, chairman, New India Assurance. In a recent meeting with the finance minister, non-life insurers had sought tax breaks for householdersinsurance to increase the penetration of non-life in the country. Insurers said that despite opening of the industry and the presence of nearly two dozeninsurance companies, the penetration of health insurance continued to be only around 0.7% of the gross domestic product. 
    According to Srinivasan, there was no reason why individuals should not be purchasing cover for household assets considering the low cost of cover. He also denied that claims process is cumbersome and requires documents to prove ownership. "Nobody maintains bills for several years after purchase. If insured household items are stolen, all that we will be requiring is a police complaint," he said. 
    Having put in place a core insurance solution, New India has opened 500 micro-insurance offices which can be manned by only one employee who can use systems to issue all policies. The increased investment in branches comesat a time when the company has turned around and reported a net profit of Rs 517 crore as against a loss of Rs 177 crore in the corresponding quarter last year. The company recorded a rise in profit following a hardening of premium rates. 
    Premium income grew by 18.18% to around Rs 8,500 crore in the first nine months of this fiscal. "We plan to reach premium target of Rs 12,000 crore by the end of this fiscal with Rs 10,000 crore coming from domestic operations and rest from overseas," Srinivasan told reporters here. On the focus areas, Srinivasan said that the company would focus on all lines of business with special emphasis on retail, SME and personal line of business. "We are going to launch our online services soon," Srinivasan said adding that the company is also increasing its agent strength to enhance its penetration 
    Srinivasan also said the company, which had reported a loss ratio of 97% in the health insurance sector, aims to reduce it to 92-93% by March, 2013. The company has sought an increase in rates in health insurance for which clearance is awaited. 
    "We have seen sound increase in the investment income during this period owing to the improved market conditions. We hope this trend to continue in the fourth quarter of this fiscal," Srinivasan said.