Will maintain bancassurance and agency distribution mix: Pankaj Razdan, Aditya Birla Sun Life Insurance

Aditya Birla Sun Life Insurance, which was earlier an agency-heavy insurer, is now looking to balance its distribution architecture between the proprietary and non-proprietary channels. In an interaction with Moneycontrol, Pankaj Razdan, MD & CEO, Aditya Birla Sun Life Insurance, said that the idea is to not rely too much on one single channel.

"We have partnered earlier with HDFC Bank and this has been beneficial. However, we don’t want a polarised distribution," he said.

As per the insurer's public disclosures, in H1FY19 individual agents sold 72,308 individual policies while banks sold 26,609 policies.

As of September 2018, total AUM of the insurer stood at Rs 37,904.3 crore. Aditya Birla Sun Life recorded a gross premium income of Rs 1,806 crore in Q2 FY19, showing an 84 percent year-on-year (YoY) growth in individual first year premium.

According to the figures released by the insurance regulator, the company posted a 58.08 percent YoY growth in first year premiums to Rs 2,685.33 crore.

Razdan said that their aim is to ‘disproportionately’ outpace the industry growth in FY19 in terms of premium collection. However, he explained that they will not merely look at bring in numbers.

"We would want to improve the quality of the business. There is no point blindly doing a 70-80 percent growth at the cost of dip in persistency (renewals) and rise in surrenders," said Razdan.

For Q4FY19, the life insurance company has launched a monthly income plan that aims to provide regular monthly income until maturity to customers. The fourth quarter is the most important period for insurance companies since a majority of individuals buy insurance for tax-saving purposes.

Their new product is a non-linked plan that has an in-built accidental death benefit. It also offers a waiver-of-premium rider and a critical illness rider that can be bought separately.

Open to acquisitions 

Aditya Birla Sun Life Insurance was in the race to acquire IDBI Federal Life. However, this process was shelved after Life Insurance Corporation of India (LIC) bought majority stake in IDBI Bank.

Razdan, however, said that they are open to acquisitions if it is the right fit.

"It should be an opportunity that helps us either expand our distribution, improve digital technology or customer management. It should be complementary to our business," he signed off.