SBI Life targets 25 % growth in 2018-19

SBI Life Insurance, a joint venture (JV) between State Bank of India (SBI) and BNP Paribas Cardif S.A., is targeting to grow its new business premium (NBP) by 25 per cent in 2018-19, with more focus on pure protection products, besides unit-linked insurance plan (ULIP).

Speaking to Business Standard after inaugurating SBI Life Insurance's regional office in Chennai, Sanjeev Nautiyal, managing director and chief executive officer (CEO), said individual new business premium grew 30 per cent in FY18 to touch ~ 84.1 billion, as compared to ~64.7 billion in FY17. The target for FY19 is to achieve ~105 billion. ULIP products accounted for 77 per cent in 2016-17, and currently it contributes around 73 per cent as the company has adopted a cautious approach to increase the contribution of pure protection products.

The company is of the view that pure protection products ensure profitability, though the ticket size is small. The ULIP, a traditional policy with protection, and a couple of other combination of products would be among those. He said the company was planning to bring in a slew of combo products to contribute to its growth.

"We've seen a good growth in new business premium income, which was at 15 per cent by the end of the first quarter. Going by the business trends, we are confident that it will be 25 per cent at the end of the fiscal," said Nautiyal. To support growth, besides adding around 1,500-2,000 people, which will take the total staff strength to around 15,000, SBI Life plans to tie up with commercial banks for bancassurance services. The number of branches will be increased to around 900 in 2018-19 from the current 825. Nautiyal said the claim ratio was around 96.97 per cent, currently, and by the end of the year, it would reach 98.41 per cent.

While ruling out any capital infusion in the current fiscal, Nautiyal said the company got enough capital and the solvency ratio stood at 2.14 per cent at the end of first quarter of the current fiscal, as against 2.11 per cent in the year-ago period.

To support growth, SBI Life plans to tie up with commercial banks for bancassurance services