SBI Life to Expand Bancassurance by 50%
The country’s biggest banking network SBI along with its insurer is planning to expand bancasurance channel by 50% alongside raising the field force by about 10% to push business growth. The company aims to grow business by 30% this fiscal. SBI has a 16,333 strong branch network with 50% of it selling SDBI Life’s policies. SBI Life’s Managing Director Arijit Basu said that, its average business per branch is about Rs.8 lakh while it would be around Rs.50 lakh for its nearest rivals.
SBI Life, the 74:26 joint venture between SBI and BNP Paribas Cardif was the largest private insurer in terms of new business at the end of March 2015 while it was third among private players in terms of total premium collection, the company official said.
It plans to raise the number of agents to 90,000 by the end of this fiscal from 83,000. According to Basu, SDBI Life’s existing agents are running in highest productivity and therefore, the company needs to expand the team to push growth.
The company’s bancassurance model accounts for 55% of its business with the balance coming through retail agencies. It reported a total business of Rs.12,867 crore in 2014-15, with the first year premium collection growing 18% to Rs.5,528 crore and the balance coming from renewal premium.
SBI would have 10% of its stake in the insurance company in favour of BNP Paribas Cardif as the government allowed up to 49% foreign holding. SBI Life has an authorized capital of Rs.2,000 crore with a paid up capital of Rs.1,000 crore.
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