 "Star Health founder Venkatasamy Jagannathan resigns from company's board")
In May 2006, when Venkatasamy Jagannathan started Star Health and Allied Insurance Company (Star Health), he and his 12 employees were sitting in a dingy room on Madha Church Road in Chennai with a monthly rent of about Rs 30,000. On Saturday, when he resigned as the non-executive chairman and director, the market capitalisation of Star Health was close to Rs 30,100 crore with over 14,000 employees, scripting an unparalleled growth story for the country’s first standalone health insurance company.
For the 79-year-old industry veteran, this is not the first retirement in his 53-year stellar career. Before Star Health, he had scripted a real turnaround saga with state-run United India Insurance Company (United India). When he took over as chairman and managing director (CMD) of United India in 2001, the company was ratcheting up losses of Rs 50 lakh. When he retired in October 2004, it chalked up a profit of over Rs 400 crore.
Ensconced in his home in Poes Garden, Jagannathan turns philosophical when asked about his future and of Star Health’s.
“For men may come and men may go, but our company will go forever,” he says, borrowing the lines from Lord Tennyson’s The Brook to mean that this was the belief he infused into his employees at United India and at Star Health.
Jagannathan started his career at Hercules Insurance Company on June 3, 1970, and became an administrative officer with United India during Nationalisation. In his sure-footed pursuit of success, he slowly climbed up the rungs of the ladder to become CMD of the company one day.
It was after his retirement that he joined hands with ETA Star Group to start Star Health.
More From This Section
“In the public sector, we had an established office. Here, I had to start from A to Z. We entered health because I thought the middle-income group needed financial wherewithal,” he says.
To save money, he had to lease typewriters. For the first two years, people looked at the venture with trepidation of failure. However, getting two government health insurance programmes, first in Andhra Pradesh and then in Tamil Nadu, turned out to be a game changer for the company, following which people started reposing trust in Star Health.
The company created a team of doctors to look into every minutiae of every bill. Today, it has 400 doctors and is credited with having one of the largest health insurance hospital networks in India, encompassing 13,000 hospitals.
Jagannathan recalls how he ensured branch managers were hired from their respective areas and how the founder would field customer calls, often at midnight.
When asked about the highest point of his career, Jagannathan calls attention to the company’s 2022–23 performance. The company clocked a profit of Rs 618 crore and an underwriting profit of Rs 204 crore, helping him to hang up his boots and post the highest-ever profit and the best industry numbers.
Looking at the Star Health numbers, nearly 39 per cent of its revenue was derived from South India, 23 per cent from West India, 30 per cent from North India, and 8 per cent from East India.
When asked about East India’s lower share, he says the insurance-conservative East market is one of the fast-evolving areas that the new leaders will have to tap into.
Jagannathan is credited with starting lunch for Star Health employees and even offering employee stock ownership plans (ESOPS) at the branch manager level, going against the grain of companies restricting ESOPs to senior-level executives only.
“A leader must know his men. A General must know his soldiers,” he adds, as a hark back to Sun Tzu.
Although he resigned from the post of CMD in May this year, he continued as non-executive chairman and director. However, the industry veteran is holding his cards close to his chest as far as retirement plans go, saying he is weighing up all fields for his comeback.
“Every beginning has an end and every end has a new beginning. I am also searching,” he signs off sagely.