Rajive Kumaraswami, MD & CEO, Magma HDI General Insurance Company Ltd
. He is an alumnus of Delhi University and a Fellow Member of the Institute of Chartered Accountants of India and Associate Member of the Institute of Cost and Works Accountants of India.
In an interaction with Shweta Papriwal, Editor, IIFL, Rajive Kumaraswami, MD & CEO, Magma HDI General Insurance Company Ltd
., said, “We expect the current growth momentum to continue in the coming years & the industry clocking growth rates of 15% to 20% levels in the foreseeable future.”
Please give us a brief of your focus segments for insurance products.
Magma HDI is a full service general insurance company, and is focused on partnering with customers for all their needs. We serve Bharat through our extensive branch network in semi urban & rural areas, and India through its metros and the top 1,000 corporates across industry spectrum.
What is your segment wise revenue contribution?
Motor – 74%, Commercial Business - 23% and Health & Accident - 3%.
What is your geography wise branch count currently? Are you poised for further geographical expansion?
Currently we have 129 Magma HDI branches across 17 States. From a zonal representation, our branch spread is present across 23
branches in North, 15
branches in Central, 36
branches in South, 31
branches in East including North East and 24
branches in West. By the end of FY19, we have plans to increase our geographical presence across more than 160 locations.
Are you focused towards rural penetration? What is your current urban to rural ratio?
Yes, we are focused on largely Rural & Semi-urban markets. Our current Semi urban to Urban Ratio is 59:41
Considering that rural is the current theme, how is your tractors/ farm equipment insurance segment faring?
Tractor Insurance has been a focus area for us from many years. In fact, a reasonable proportion of our motor portfolio is tractors. We have been able to achieve this through extensive coverage through our own branch network, buttressed by the presence of our partners.
What is your guidance over the next two years? What is your view on the overall General Insurance sector?
We, at Magma HDI, continue to be excited by the macro level developments and the emerging opportunities at Indian Markets. The strong GDP growth, introduction of National Health Protection Scheme during Union Budget 2018, increase in type of intermediaries by the Regulator, would create a positive impact pushing overall awareness of health insurance, and higher level of penetration levels.
Implementation of Long Term Third Party Policies for Four Wheeler & Two Wheeler segment, post Supreme Court Judgement can have an overall impact in General Insurance. The exact implications would be clear in the months to come.
We expect the current growth momentum to continue in the coming years & the industry clocking growth rates of 15% to 20% levels in the foreseeable future.
How was your performance in Q1FY19?
We have achieved a top line growth of 62% over Q1 FY18, against average 19% growth rate of private insurance companies. The Company has delivered a PAT of Rs19cr in Q1 FY19 against Rs0.5cr in Q1 FY18. Steady loss ratios & increased business volume have benefitted the company by way of a 7.8% improvement in the Combined Ratio. By end of Q1, we have a healthy solvency margin of 212% against IRDA prescribed 150%.