Mumbai, Sept. 6: SBI Life, a joint venture of the State Bank of India (SBI) and Cardiff SA today launched its first endowment life insurance plan “Sudarshan” and a group insurance scheme for SBI’s home loan customers.
“The group insurance scheme will cover customers of SBI to start with, and will be extended to cover home loans given by other housing financing agencies,” R. Krishnamurthy, MD and CEO, SBI Life said while launching a group insurance scheme for home loan borrowers today that provides life insurance cover, accidental death and total permanent disability benefit to customers. Also present on the occasion were SBI chairman Janki Ballabh and Cardiff SA chairman Paul Villemagne.
Sudarshan, the endowment scheme, will offer one of the cheapest policies in the industry with women given a special discount of 5 per cent on the premium. For annual premiums, the insurance company offers a 2 per cent discount.
“SBI has tremendous strength with a branch network which is incomparable,” Ballabh said on the occasion. He said although a late starter in the insurance business, it can ramp up after bancassurance is allowed in the country. Incidentally, HDFC has a scheme that allows its borrowers to opt for a insurance cover. But it is not a group insurance cover like SBI Life.
For SBI, housing loans has become a big business. The current fiscal has seen the bank disburse funds to the tune of Rs 1,700 crore and the whole year’s target has been set at Rs 4,500 crore, which the bank hopes to surpass by a comfortable margin. The scheme provides a group insurance scheme for home loan borrowers providing life insurance cover, accidental death and total permanent disability benefit.
For SBI, the offering by its subsidiary will have synergistic values as it has been focussing on the home finance segment. “We are confident that given the basic buoyancy of the household savings in the Indian market, Sudarshan will become a prominent long-term savings instrument,” Krishnamurthy said.
On the home loan insurance scheme, he said that “one of the major concerns facing a housing loan borrower is to ensure the welfare of the family and protection of the housing property”. Through this scheme, home loan borrowers can secure financial protection for their families with repayment of the outstanding loan met by SBI Life in the event of any untoward happening.