Never miss a great news story!
Get instant notifications from Economic Times
AllowNot now


You can switch off notifications anytime using browser settings.
11,921.50-96.9
Stock Analysis, IPO, Mutual Funds, Bonds & More

Reliance General Insurance swings to profit in Q3

'During the quarter ended December 31, 2012, Reliance General Insurance saw its gross written premium grow by 21 per cent to Rs 503 crore.'

PTI|
Updated: Feb 03, 2013, 12.02 PM IST
0Comments
NEW DELHI: Helped by improved pricing and an expanded agent base, leading private sector non-life insurer Reliance General Insurance Company (RGIC) has posted a profit of Rs 16 crore for the quarter ended December 31, 2012, as against a loss of Rs 34 crore in the year-ago period.

The company has swung back into profit after 16 quarters on the back of sourcing of quality business, better pricing of insurance products in the motor and health segments and enhanced retail agent force. It had last reported a profit of Rs one crore in the April-June quarter of 2009.

Reliance General Insurance, which offers auto, health, property, travel, marine and commercial insurance products among others, is a part of Anil Ambani-led Reliance Group's financial services arm Reliance Capital Ltd.

During the quarter ended December 31, 2012, Reliance General Insurance saw its gross written premium grow by 21 per cent to Rs 503 crore, its parent firm Reliance Capital said, while announcing its quarterly results.

"A change in the business mix, optimum use of technology across all operations and functions to manage cost, important corporate business and expansion of retail agents helped the company make a turnaround almost after four years," Reliance General Insurance CEO Rakesh Jain told PTI.

"A decline in claim ratios and better pricing of insurance products in the motor and health segments are also instrumental in achieving profitability. Going forward, we aim to show further improvement in profitability," he added.

The company had recorded a loss of Rs 105 crore in the previous quarter ended September 30, 2012, as it had to make one-off provisions for the industry wide third-party motor insurance pool and strengthen its own reserve for meeting motor vehicle insurance claims.

RGIC has tweaked its business mix as it has started moving away from total dependence on motor.

"We aim to bring down motor segment to about 60-62 per cent from the current 65 per cent and expect to continue health at about 15 per cent. The rest will be commercial lines, fire and engineering, which are more profitable and we are trying to grow that portfolio," Jain said.

The investment book of Reliance General rose by 37 per cent to Rs 3,255 crore as on December 31, 2012, while the total capital invested in the business is Rs 1,747 crore.

The company has a distribution network of 126 branches and over 9,900 intermediaries and a private sector market share of 7 per cent, in terms of gross written premium, of the Indian private sector general insurance industry.

Reliance Capital is looking to induct a strategic partner in its general insurance business during the next financial year, following a possible sale of a 26 per cent stake in Reliance General Insurance.

Also Read

Unusual Insurance: How startups are changing the insurance game

Policy shift: Insurers blacklist coal

Make sure insurance ads are clear, fair and not misleading: Irdai to insurers

TCS to take insurance platform places

DHFL bankruptcy: Irdai rules out troubles for two insurance arms; asks insurers to write off exposure

Comments
Add Your Comments
Commenting feature is disabled in your country/region.
Download The Economic Times Business News App for the Latest News in Business, Sensex, Stock Market Updates & More.

Other useful Links


Follow us on


Download et app


Copyright © 2019 Bennett, Coleman & Co. Ltd. All rights reserved. For reprint rights: Times Syndication Service