Cover story

New Delhi, Oct. 11: Stung by a 5 per cent loss of market share in the past year to nippy private players, state-owned non-life insurers are scrambling to get their acts together.

For starters, they are sprucing up the IT networks that link up all their offices across the country. So if you have moaned about the poor quality service at the state-owned insurers over getting claims processed or receiving reminders about premia payment, rant no more.

The PSU insurers have launched a programme called Genesis Enterprise to rig up fast and innovative networks that can process claims quickly and give out payments fast.

When the systems are up and running, here?s what you can expect: a software programme that sends out SMS alerts to clients on premium and policy updates, electronic facilitation of claims and on-line issue of policies.

The programme is a little genie that the government has uncorked to help win back some of the lost turf and make sure that they don?t cede any more ground.

The programme calls for upgrading the IT systems in the branch, division and regional offices and their networks with the head offices of the state-owned general insurance companies.

The insurers have started the programme to support its back-end networking initiatives, better spend management and augment the distribution channels.

At present, there are four public sector non-life insurance companies ? National Insurance Co, Oriental Insurance Co, New India Assurance and United India Assurance.

They offer a portfolio of products including health insurance, motor, fire, marine and similar other products.

After decades of operating under near-monopoly markets, these companies are facing stiff competition from the new private players. At present, there are 12 non-life private insurance companies operating in the country.

According to figures published by the Insurance Regulatory and Development Authority for market share till July, New India tops with a share of 21.21 per cent. It is followed by National India which has garnered 17.25 per cent market share, United India and Oriental Insurance have managed to secure 15.98 per cent and 17.44 per cent respectively. In contrast, the cumulative market share of new players has grown from 18.7 per cent at the end of July last year to 25.6 per cent in the same month this year.

Sources said the new measures were aimed reducing management expenses. ?The Genesis Enterprise programme is expected to bring down the management expenses ratio to a permissible limit.?

A ballooning wage bill has also crimped the bottomelines of these companies. Sources said the benefits from a recently implemented Special Voluntary Retirement Scheme would start to show up on the balance sheets in the medium term.