MUMBAI, May 22: The General Insurance Corporation (GIC) and its four subsidiaries -- New India Assurance, United India, Oriental Insurance, National Insurance -- have set a target of 17-18 per cent business growth in 1998-99. The general insurance industry had recorded the lowest-ever -- 12 per cent -- growth in the previous fiscal year. It has collected a total premium income of Rs 7,822 crore during 1997-98.GIC and its arms are now planning to mobilise above Rs 9,000 crore in 1998-99. The GIC outfits had failed to achieve the projected 14 per cent business growth in 1997-98 due to the severe industrial recession which had hampered the insurance industry. The companies had initially set a target of 19.2 per cent in early 1997-98 and later revised it downwards to 14 per cent in the second half of the fiscal year against the backdrop of the industrial recession.
However, according to company officials, there has been a distinct improvement in the country's industrial climate which has prompted them toset an optimistic target for business growth in 1998-99.
The two top general insurance subsidiaries -- New India Assurance and United India -- have set a target of Rs 2,867 crore and Rs 2,440 crore, respectively, during 1998-99.
The automobile industry, which contributes almost 33 per cent of the premium of the general insurance industry, is slowly looking up.
"The recessionary trend needs to be reversed with a suitable long-term planning in terms of growth for different business areas, business management and proper human resource development for the general insurance industry," an industry expert said.
According to him, the industry's organisational growth and reach have not been matched by growth of business in the `personal line' category like personal accident, medical, property and liability insurances. GIC chairman KC Mittal has asked the industry to make efforts to avoid fragmentation -- be it in the area of marketing, investment or reinsurance.
"We have to face the competition of the newmarket place on the basis of our combined strength," said Mittal, adding that GIC group companies combine creatively to combat inertia and draw up a road map to achieve international standards.
Commenting on the need to change the marketing strategy to face competition, Mittal said that the companies should no longer be content to wait for the customer but stimulate demand in order to grow.
"Our industry has to devise ways and means to identify new customers. Despite inherent shortcomings of the country's demographic scenario, problems of logistics have to be overcome to reach out to customers," he added.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
