SBI Life premium up 233%

SBI Life Insurance has booked a 233 per cent rise in gross premium income at Rs 200 crore in the financial year ended March 31, 2004, compared with Rs 60 crore registered in the previous fiscal.

S Krishnamurthy, managing director and chief executive officer of SBI Life, said the insurance company plans to introduce four new products, including one targetted at the non-resident Indian community, over the next few months.

During the last fiscal, the life insurance arm of State Bank of India (SBI) has covered 13 lakh lives, and more than two lakh individual policies were issued. "So far, the company has covered 75,000 home loan borrowers," said Krishnamurthy.

Krishnamurthy was addressing the media at a function where SBI Life and Union Bank of India signed an agreement to offer group life insurance to the latter's home loan customers.

Union Bank of India, despite being a corporate agent of HDFC Standard Life, has tied up with SBI Life. V Leeladhar, chairman and managing director, Union Bank of India, said: "We have studied various schemes offered by different companies and finally decided to tie up with SBI Life as it provides a wide range of products. Also, their claims settlement process is hassle-free."

Leeladhar said the bank expects to cover around 8,000 home loan customers under the new scheme in the financial year 2004-05.

"Through this product, we will able to reduce the incidence of non-performing assets. We can also increase fee-based income and retain customers."

Union Bank of India's home loan book grew 20 per cent to Rs 1,800 crore in the financial year ended March 31, 2004. Leeladhar said the company's home loan portfolio was rising 20-21 per cent every year.

Under the new scheme unveiled by Union Bank of India and SBI Life, 5-20-year home loans would be covered, and the size of the cover would be Rs 50,000 to Rs 50 lakh. The premium would be set based on the loan amount, tenure and age of the borrower.

SBI Life already has such offerings for home loan customers of United Bank of India, some private home finance firms, SBI and its seven subsidiaries.

Krishnamurthy said, "The company is in talks with some other banks also for such products." "On an average about 50-60 per cent customers from SBI opt for this kind of scheme and we are getting 10-12,000 applications per month," he added.