Chennai-headquartered Cholamandalam MS General Insurance Company Limited (Chola MS), a joint venture between Murugappa Group and Mitsui Sumitomo Insurance of Japan, is planning to invest Rs 200 crore in three years.
“So far, the company’s capital investment has been Rs 269 crore and the Rs 200-crore investment will be for our pan-India expansion with investment ratio of 26:74 (Mitsui Sumitomo Insurance:Murugappa Group),” said SS Gopalarathnam, managing director of Chola MS.
The company also plans to launch six health products, three of which would be launched in the fourth quarter and the remaining by the first quarter of next fiscal.
“We would use Murugappa group companies to leverage our products in the market. They will be Coromandel International, Coromandel Fertilisers, EID Parry (India) Limited and others,” he said.
The proposed health products would be similar to the central government’s Rastriya Swasthya Bima Yojana, which we the company is implementing in Gujarat, Maharashtra, Bihar, Jharkhand and West Bengal, he said.
India has tapped only 5 per cent of the overall insurance market. “The penetration is very low. The health insurance segment is expected to go up to 32 per cent from the current 21-22 per cent in the next three years,” he said. Chola’s market share would reach 27 per cent from the current 20 per cent in three years.
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Gopalarathnam said, “In the overall segment, motor contributes about 60 per cent of total premium and health accounts for 20 per cent.” The travel insurance segment is growing quite slow at 1.5-2 per cent as the premium is very low.
In Andhra Pradesh, the company generates Rs 60-70 crore premium per month, and expects to double it in the next one year. “With a current network of six branches and over 220 agents in AP, Chola MS is expected to grow by over 50 per cent in the next fiscal,” he said.
The company is targeting gross written premium (GWP) of Rs 2,000 crore and Rs 100 crore profit by 2013. In 2009-10, it earned a GWP of Rs 785 crore and a profit of Rs 2 crore.