The Hindu : Business : National Insurance posts Rs. 71 crore profit

Online edition of India's National Newspaper
Tuesday, Aug 31, 2004

Business

Business

National Insurance posts Rs. 71 crore profit

By Our Special Correspondent

KOLKATA, AUG. 30. The National Insurance Company has posted a net profit of Rs. 71.23 crores for 2003-04, H. S. Wadhwa, Chairman-cum-Managing Director, said.

However, he said profitability had taken a hit (it was substantially lower than 2002-03) on account of the Rs. 57.50 crore expenditure on the special voluntary retirement scheme, increased provisioning and problems arising out of the company's entry into the insurance of mobile telephony.

Mr. Wadhwa said NIC had a good overall business spread and segments such as the auto sector had good potential. In 2003-04, NIC's premium income grew at 18 per cent on Indian business compared to the average growth of 3 per cent for other three PSU insurers. NIC was targeting a premium income of Rs. 4,360 crores this fiscal compared to Rs. 3,423 crores in 2003-04 and Rs. 2,863 crores in 2002-03.

He said in addition to entering into a tie-up with 300 dealers of Maruti (which is expected to yield a premium of Rs. 600 crores in the current year) pacts had also been sealed with Hero Honda, where NIC was expecting a premium income of Rs 200 crores. "Talks were being held with other auto majors too,'' he said.

According to Mr. Wadhwa tie-ups with 15 banks, whereby they were generating insurance business — on their own financing as well through personal insurance — had also emerged as a good business area.

Elaborating on the problems faced by NIC with respect to the liability on account of Reliance Infocomm, Mr. Wadhwa said NIC had to provide Rs. 152 crores as its claims liability.

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