National laps New India, is general insurance leader

National Insurance Company has overtaken New India Assurance Company to emerge as the numero uno in the general insurance sector for the first time.

National posted a premium income of Rs 2,071.49 crore during the six months to September 30, 2004, against New India's gross premium income of Rs 2,069.77 crore. This translates into a market share of 22.49 per cent for National, just ahead of New India's 22.47 per cent.

According to the Insurance Regulatory and Development Authority (Irda), National has posted the sector's highest growth rate ever of almost 39 per cent.

H S Wadhwa, chairman and managing director of National, had earlier told Business Standard that the company was confident of securing the number 1 slot this financial year.

The Kolkata-based state insurer has been aggressively increasing its topline in the recent past.. National was ranked fourth among the four state-owned general insurance companies till last year. The four state insurance players today have 79.13 per cent of the total Rs 9,211 crore general insurance market. The industry overall has recorded a 20 per cent growth during the current financial year.

National Insurance's aggressive drive and its ability to gain entry into the risk business of top corporate houses like Reliance and Tatas, as well as its tie-ups with banks has helped the public sector entity move up three notches (in ranking) within a span of less than one year.

National's personal rapport with a number of corporates and bank tie ups, as well as recruitment of 50,000 agents are expected to help it bag the number 1 slot, Wadhwa told Business Standard earlier.

In vast contrast, New India has preferred to control its topline as it "exercises underwriting prudence", pointed out the company's director and general manager, A V Purushothaman. This has been exemplified in the profit figures of the two public sector companies for the year ended March 2004.

New India's net profit rose by 126.95 per cent to Rs 590 crore on the back of higher underwriting profit and a 64 per cent increase in investment income of Rs 1,250 crore.

National on the other hand, recorded a 46 per cent decline in its bottomline. This came largely on the back of Rs 152 crore claim from Reliance Infocomm.

Meanwhile, among the eight private sector insurance players, ICICI Lombard continues to lead with a 4.43 per cent market share, up from 4.38 per cent last month. Bajaj Allianz though has increased its market share to 4.29 per cent in September, is number two.

However, the four public sector insurance undertakings have managed to regain lost ground in September, with their combined premium income accounting for Rs 159 crore, almost twice as much garnered by the 8 private players at Rs 87 crore. In earlier months the private insurance entities had managed to secure a larger portion of the overall monthly premium.