Shriram General Insurance, already heading towards expansion in the industry with the decision of hiring more than 5,000 staff members and numerous branches. The company is the joint venture of Shriram Capital and South Africa’s Sanlam Capital. On the occasion, Mr. Neeraj Prakash, Managing Director of Shriram General Insurance shared some insights regarding business. The conversation base is all about the company’s hostile growth plans, key areas of focus and why it will continue to focus on profitability.
When the question arises about the 10 years of journey and the operation, Mr. Neeraj says it all. We started in 2008 and in these 10 years, we have done well in terms of profitability. Last year, we had a PAT of ₹ 400 crore and the top line was around ₹ 2,100 crore. In terms of profitability, we have become the fifth largest player in the private sector. At present we are selling 1.5-2 lakh policies per month, besides issuing 2.75 lakh policies for IRCTC per day. Going ahead, we are expecting a better result.
While discussing, where will next phase of growth come from? The last two-three years of the company shows sound profitability and now getting around the expansion mode. The information says Shriram General Insurance will be hiring about 5,000 more employees in the next two-three years. Currently, it’s close to 17,000 IRDAI agents and by the end of the year, we want it to reach 18,000. While the next fiscal year expecting about 25,000 agents. On the network side, right now we have about 162 branches and we are planning to have over 200 branches by the end of next fiscal.
The concentration is to shift the bulk expansion is to get in the C and D class cities, particularly in the eastern region where Shriram General Insurance have less number of branches as well as Maharashtra and Gujarat. ”The idea to get into these regions is that most of the people are not having insurance coverage. Also, owing to small base, small ticket size, and difficulty in collecting premium, not many companies are keen to get into these places”. Neeraj Prakash added.
Coming to the segments of primary focus in targeted regions, the main focus will be on motor insurance business where the company is already doing well. While in the motor business the concentration will be on commercial vehicles as well and two-wheelers. Next, the focus will be on home insurance and business protected policies. The business protected policy has 10 sections that cover almost everything of small enterprises be it building, content, money or money in transit.
Conclusively, Neeraj Prakash, the Managing direction of the company commenced, The industry is growing at a CAGR of 10-20 per cent and we expect to grow at similar pace. To be true, we are not focusing on the topline, but on the bottom line. That is why our topline is not growing like the bottomline. We are focusing on quality business and we are into the rat race to sell more policies.