Cholamandalam MS General Insurance Company (Chola MS), the joint venture between Murugappa group and Japan’s Mitsui Sumitomo insurance group, on Thursday said it is re-entering the crop insurance business and will be scaling up its overall market share among the multi-vertical players to 5% from the current 2.87% over a period of next three to four years.
V Suryanarayanan, MD at Chola MS, told FE that the company would continue to grow ahead of the industry. “Our aspiration is that over the next three to four years, we will be able to reach the target of 5%.”
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On the plan to re-enter the crop insurance business, Suryanarayanan said the key issue which made them withdrew in 2018-19 was non-receipt of premium from the state governments. “Now there are much more enabling provisions and the governments are showing commitment. Ultimately, insurance companies should get the money to pay for the claims.”
At the time of exit, the company had a Rs 580-crore crop insurance portfolio and had 10-11% share. Currently, the crop insurance industry‘s size is about Rs 25,000 crore.
The Chennai-based company ended FY23 with a gross written premium (GWP) of Rs 6, 200 crore, logging a YoY growth of 27.6%, against the industry growth of 16.2%. The company earned a net profit of around Rs 200 crore for the year with a net worth of Rs 2,160 crore and a solvency ratio of 2.01 times, against the regulatory minimum of 1.5 times. The company has grown its investment corpus to Rs 14,715 crore and enjoys high multiples of investment corpus to net worth and GWP.
Chola MS has a market share of 5.3% in motor line of business and 4.9% market share in personal accident line of business. The company has strong bancassurance partnerships with government-owned banks, private banks, small finance banks and rural banks.
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It also operates on most major automobile OEM insurance programmes and has an agent network of 50,000. Over the years, Chola MS has grown consistently to expand its physical presence in 26 states with over 600 touch points, serving over 34 million customers.
“Around 60% of our business comes from non-South states and we are now focusing on eastern geographies, including West Bengal,” he said. The company is focusing on introducing more products in health insurance vertical. It settled over half a million claims in FY23 across lines of business.
