As the coronavirus pandemic has restricted people to their homes, SBI General Insurance has intensified efforts to reach virtually. In the new normal, to collect new business premium, the general insurance major has shifted focus to strengthen digital infrastructure for both its customers and employees with an emphasis on process automation, its Chief Financial Officer Rikhil Shah told BusinessToday.In.
Talking about the company's financial performance during the quarter and half-year ended September 30, 2020, Shah revealed that health segment remained the biggest contributor to gross written premium for SBI General Insurance, while motor insurance finally bounced back in Q2 FY21. Meanwhile, travel segment is likely to take some more time to recover, he added.
Read the complete interview below:
Q. As passenger vehicle sales pick up, what is the outlook regarding motor vehicle segment?
Rikhil Shah: Traditionally motor insurance has been the largest contributor to business in the non-life segment. However, due to COVID, we saw a significant dip in business in Q1 as new vehicle sales were almost non-existent. But Q2 saw a bounce back as the country got back to normalcy and vehicle sales picked up. YTD September motor insurance has a 29 per cent market share. We expect this trend to continue for the remainder of the year and motor segment will finish strongly.
Q. How did the travel segment fare during Q2 and H1 of FY21? Did the unlocking process led to any uptick in this segment?
Shah: Travel segment unfortunately is affected heavily at the entire industry level. As there have been severe restrictions on both domestic and international travel during the past few months, there has been a significant impact. Although the scenario is expected to improve in the coming months with travel restrictions being lifted, it may take some more time for this segment to pick up as people may still have reservations about travelling, whether for business or pleasure.
Q: What key changes have you initiated post-COVID to collect new business premium?
Shah: We have taken quite a few initiatives post COVID. We have strengthened digital platforms given the situation. Customers and employees alike required ramping up of digital infrastructure. We have been leaning towards process automation and taking measures in that direction. We have also introduced tele-medical underwriting facility whereby customers can avoid visiting clinics for medical tests and can instead be assessed by phone or video by one of our panel doctors.
Q: How much does health insurance account for in overall gross written premium? Apart from health insurance, which two other insurance segments contribute most to GWP and their contribution?
Shah: Health has contributed nearly 30 per cent of the total GWP in H1 FY21 and has registered 15 per cent growth when compared to the same period last year in the GI industry. Motor and Crop are the two other large contributors with 29 per cent and 19 per cent, respectively.
Q. What new additions can we expect to the product bouquet? Will there be any new offerings with the COVID-19 pandemic in mind?
Shah: We have already introduced regulator-mandated health products such as Arogya Sanjeevani, Corona Kavach and Corona Rakshak, which have met with a good response from the market. The insurance regulator has also established a working group to examine the possibility of establishing a pandemic risk pool and the group has submitted its report in September. We await further advice from the regulator in this respect and would be keen on participation in any such venture.
In addition to the above, we are in the process of filing products with a focus on semi-urban and rural population where penetration of insurance, especially in health, is on the lower side.
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