Shriram General Insurance bets big on EVs, join hands with several OEMS

Company targets 40% growth in gross direct premium in 2023-24

Shriram General Insurance (SGIC), a joint venture between Shriram Group holding company Shriram Capital Ltd and South African major Sanlam, said on Friday that its main focus areas in the 2023-24 fiscal is electric vehicle insurance. The firm added that it has already tied up with several original equipment manufacturers (OEMS) towards this end.

While the company is closing 2022-23 with a growth of 28-29 per cent in gross direct premium, it hopes to touch 40 per cent in 2023-24, a senior SGIC executive told Business Standard. In comparison, the industry posted 11 per cent growth in FY22. It expects 17 per cent growth in FY23 and is targeting over 20 per cent in FY24.

“I will say that due to Covid, we were not doing very well up to 2021-22, but 2022-23 was a good year. We saw a growth of about 28.27 per cent up to February and are likely to reach 28-29 per cent by year-end. We also expect to grow by 40 per cent in FY24,” said Anil Kumar Aggarwal, MD & CEO, Shriram General insurance.

Aggarwal said EV insurance will be a key focus areas for the company in 2023-24. “I will say this is the focus area for the coming year (2023-24). We are bullish on it. We are expecting EV business to cross Rs 100 crore in 2023-24,” Aggarwal said. In 2021-22, its business from the EV sector was about Rs 30 crore and is expected by 150 per cent to touch Rs 75 crore in 2022-23. The company’s increased focus comes at a time when the country's overall EV sales in February rose 94 per cent to 105,976 units over the same period in the previous financial year.

Interestingly, SGIC's net profit had dipped nearly 47.5 per cent to Rs 147.48 crore in the first half of 2022-23, mainly due to a fall in investment income. “We are not bothered about profit this year (2022-23)==it may be down because of the investment income and the number of new branches.  We have already opened 28 new branches this financial year and are looking to open 30 more in 2023-24. The focus was to create infrastructure and a base so that in the future there should not be any problem. Shriram General Insurance will recruit around 1,000 people during the next financial year and the target is to hire 5000 more people over the next two years,” he said.

As part of its hiring strategy, the firm wants to increase the share of women employees from 5.13 per cent now to 10 per cent in the next two years. Earlier this month, SGIC had started two women-only branches in Ludhiana and Jaipur in a first-of-its-kind initiative in the industry. The entire workforce--from the branch manager to the support staff--are women and SGIC has plans to strategically replicate the same model nationwide going forward.