Private sector Aviva Life Insurance today reported a profit of Rs 29 crore for the year ended March 2011, first time since inception in 2002.
The company had incurred a loss of Rs 345 crore in the previous year.
"The transition to profitability is a result of proactive steps taken to re-organise the product portfolio and continuous management focus on achieving higher productivity, improving persistency and strategic cost management," said Aviva India Managing Director T R Ramachandran.
However, the new business premium of the insurer declined by 7% to Rs 745 crore at the end of March 2011.
"On the back of regulatory changes last fiscal we have seen a degrowth in the first year premium. However, we expect a 10-15% growth in 2011-12," he said.
The company maintained total premium collected at par with previous year at Rs 2,345 crore with total Assets under Management pegged at Rs 7,654 crore.
This is despite the market volatility and significant challenges faced by the sector, he said.
"Our business focus has been on sustainable and profitable growth driven by a quality led business model focused on Bancassurance," he said.
The new business premium of the insurer declined by 7% to Rs 745 crore at the end of March 2011.
Aviva Life Insurance is a joint venture between Dabur and Aviva, with domestic entity having 74% stake and UK-based Aviva Plc holding 26% stake. The company has a total paid up capital of Rs 2,004 crore as of March 2011.
The company has capitalised on the large opportunity in the protection and child segment and in the last financial year, nearly 10% of business has been contributed by each of these segments, he said.
The insurer would continue to focus on child space and term plan in the current fiscal and introduce new products in the segment.
Aviva India launched seven new traditional products and 4 unit-linked products in 2010-11.
The strong management focus towards resource optimisation and cost efficiencies led to a reduction of 20% in total operating expenses, he said.
The company's operating expenses to Gross Written Premium ratio improved to 24% in 2010-11 against 30% in the previous fiscal.
With its focus on rural and microinsurance, he said, the company has achieved its rural and social sector obligations prescribed by IRDA.
