With the government announcing listing plans for public-sector general insurance companies, Kolkata-based National Insurance Company (NIC) is firming up plans to undertake a valuation exercise. K Sanath Kumar, the newly-appointed chairman and managing director of NIC, talks to Namrata Acharya about his vision to boost the company’s growth. Edited excerpts:
The government has announced the listing plans of general insurance companies. Has there been any discussion with the government about the listing plans of NIC?
Have you started any internal preparation for the listing?
Not yet. Possibly, for valuation, we might have to appoint a consultant. It will be an internal valuation exercise. All the public-sector general insurance companies have a huge embedded valuation, which has to be discovered.
Is there an imminent need for capital?
Essentially, none of the public sector general insurance companies is in dire need of capital now. However, if we go for further expansion and the regulator comes out with solvency-II norms, which is probably down the line, we might need capital.
What are your focus areas of growth this year?
This year, we have two-to-three thrust areas. Currently, we are at a sub market-growth rate. The general insurance market has been growing at 12 per cent. Our growth has been eight per cent. We are looking for a minimum 15 per cent market growth. This year, the focus will be on digital platform consolidation. We need to have central data storage and core insurance solution. The project is on; we are fine-tuning it. So, by the end of this financial year, we will be completely on a digital platform. Our IT partner is HCL Technologies. Our major drivers of growth have been health and motor insurance.
How big is the concern of underwriting losses for NIC?
The entire insurance sector has been making underwriting losses. Our major profit comes from investments. There has been some increase in premium in third-party motor insurance. This year, the increase is 20-30 per cent, which is good. We hope there would be more level-playing field in group health insurance and large property business. There is heavy discounting in large property insurance, owing to heavy competition.
How has been the reinsurance market this year?
