OM Kotak Life eyes 300% increase in premiums

OM Kotak Mahindra Life Insurance Company, the life insurance division of the Kotak group, is targetting a 300 per cent rise in the life insurance premiums for the financial year ending March 31, 2004.

The life insurance premium collected by the company in the fiscal year 2002-03 was around Rs 35 crore.

This will increase beyond Rs 100 crore by the end of the current fiscal year, Kotak Mahindra Bank officials said.

"We expect a 300 per cent rise in the life insurance premium deposits by the end of the current fiscal year. The life insurance premium deposits will cross the Rs 100 crore mark by the end of the current fiscal year, placing us strongly among the private insurance players in the country," OM Kotak Life Insurance Company chairman Uday Kotak said in Ahmedabad on Tuesday.

Kotak said while the insurance premium deposits grew considerably in the last fiscal year also, it is set to register a new high.

"With more and more Kotak Mahindra Bank branches being opened and our presence being expanded rapidly, we foresee the trend to continue," he said.

Kotak Mahindra Bank will serve as the platform for all other activities of the group like insurance, mutual funds, investment banking, stock broking and passenger car finance besides commercial banking.

OM Kotak Mahindra Life Insurance posted a 262 per cent growth in individual premium income at Rs 21.48 crore in the third quarter ended December 2003 as compared to Rs 5.93 crore during the corresponding quarter last year.

The total premium income for the nine-month period from April to December 2003 grew by 133 per cent at Rs 43.5 crore as against Rs 18.7 crore in the same period last year.

The officials said sustained and impressive growth in the nine months would gain further momentum during the last quarter of the current fiscal year and help achieve the target of Rs 100 crore premium income in 2003-04. OM Kotak Mahindra Life Insurance has decided to hike its share capital by Rs 30 crore at the end of the current financial year.

The present capital base of the company is Rs 203 crore.

"We will inject Rs 30 crore to increase our share capital either by the end of the current financial year or at the beginning of the next," a company official said.

In the first six months of 2003-04, the company could mop up Rs 26.13 crore premium.

Its unit-linked, child and capital multiplier products are the major contributors to the premium income.

Insurance penetration has increased to 12 per cent in the current financial year from 8 per cent last year.