ADAG bets big on rural insurance; clocks Rs 148 cr premium
Reliance Life Insurance has said it sees significant growth potential in rural market and has already garnered premium worth Rs 148 cr.
By PTI |
MUMBAI: Anil Ambani group's Reliance Life Insurance on Sunday said it sees significant growth potential in rural market and has already garnered premium worth Rs 148 crore since its foray at the beginning of this fiscal.
The total premium collected by ADAG firm till November 2007 is about 48 per cent higher than the largest private sector life insurer ICICI Prudential's rural insurance premium. ICICI Prudential had collected total premium of Rs 100 crore since the launch of this initiatve till November 2007. It started the initiative in February.
"We see a significant growth potential in the suburban and rural markets. People in these areas have not been provided with adequate choice of quality insurance products and need to be educated on the benefits of insuring their lives," Reliance Life Insurance's CEO Nanda Gopal said.
Speaking on the strategy to tap this market, he said the company was developing a rural business model that would ensure smooth operations as the business scales up.
"The support system built to drive the rural initiative also includes support in regional languages, an automated set of micro offices that can take decisions quickly, and a host of consumer education initiatives.
The total premium collected by ADAG firm till November 2007 is about 48 per cent higher than the largest private sector life insurer ICICI Prudential's rural insurance premium. ICICI Prudential had collected total premium of Rs 100 crore since the launch of this initiatve till November 2007. It started the initiative in February.
"We see a significant growth potential in the suburban and rural markets. People in these areas have not been provided with adequate choice of quality insurance products and need to be educated on the benefits of insuring their lives," Reliance Life Insurance's CEO Nanda Gopal said.
Speaking on the strategy to tap this market, he said the company was developing a rural business model that would ensure smooth operations as the business scales up.
"The support system built to drive the rural initiative also includes support in regional languages, an automated set of micro offices that can take decisions quickly, and a host of consumer education initiatives.
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The company also plans to enhance its presence in rural and suburban areas through a combination of distribution channels, he said adding it is in the process of tying-up with several rural banks and NGOs to take its products to larger audiences.
Currently, the rural premiums contribute over 16 per cent of our total individual premiums of the company. "Going forward, we see a very significant growth in the contribution of rural business to our total business," Nanda said.
Insurance companies are required to sell at least 7 per cent of their policies in rural areas in the first year of operation, a norm which increases up to 20 per cent by the 10th year of operation.
"We have sold over 20 per cent of our policies in the rural areas, which is well above the stipulated requirement of 18 per cent, applicable to us in the current year," Nanda added.
Currently, the rural premiums contribute over 16 per cent of our total individual premiums of the company. "Going forward, we see a very significant growth in the contribution of rural business to our total business," Nanda said.
Insurance companies are required to sell at least 7 per cent of their policies in rural areas in the first year of operation, a norm which increases up to 20 per cent by the 10th year of operation.
"We have sold over 20 per cent of our policies in the rural areas, which is well above the stipulated requirement of 18 per cent, applicable to us in the current year," Nanda added.
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