Chennai, June 16 (IANS) At a time when non-life insurers say that motor insurance is a bleeding portfolio, Shriram General Insurance Company, which earns nearly 98 percent of its premium from selling vehicle insurance policies, has not only logged net profit but also underwriting profit.
‘For the year ended March 31, 2010 the company earned an underwriting profit of Rs.5.45 crore on a net premium of Rs.224.20 crore. The gross premium is Rs.416.93 crore and the net profit is Rs.15.87 crore,’ Jasmit Singh Gujral, managing director of the Jaipur-based firm, told reporters here Wednesday.
Underwriting profit is premium income minus direct costs and claims.
The company’s management expense ratio is around 6.5 percent as against the maximum permissible of 19.5 percent under the insurance act.
According to him, the company has underwritten other businesses, fetching a premium income of around Rs.7 crore.
‘We are not into corporate insurance as the premium rates are uneconomical and unrealistic. Around 75 percent of our premium income is from underwriting trucks and the balance from cars, two wheelers and others,’ he told IANS.
Targeting a gross premium income of Rs.650 crore this fiscal, Shriram general plans to double its branch network to 100 and add 750 agents.