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Royal Sundaram Alliance Insurance net Spurts 146%

15 May, 2007

Royal Sundaram Alliance Insurance Company, a non-life JV of Sundaram finance and Royal & SunAlliance, has reported a 168% spurt in profit before tax at Rs.27.18 crore in the year ending March 07, against Rs, 10.16 Crore in the previous year. The profit after tax went up by 146% to 21.1 crore. It registered topline growth, taking its premium income to Rs.601 crore.

Personal insurance saw a 40% growth at Rs.391 crore while commercial insurance notched up Rs.210 crore, Royal Sundaram's market share in the general insurance category rose marginally from 2.16% to 2.35% last year. Motor insurance continues to be its cash cow, contributing to 51% of its total premium. Health insurance fetched Rs.96 crore. Commercial insurance from SF and TVS group contributed Rs.12 crore last year. It reported a treasury management with investment income growing from Rs.21 crore toRs.32 crore and totral funds under management stood at Rs.500 crore. The buoyance in revenue is attributed to the decrease in expense ratio from 21.1% last fiscal to 18.3% this year and also the loss tatio which decreased from 64.8% to 61.1%. The growth in revenue also fetched a 16% post tax return on equity last year. The combined operating ratio (COR), down to 95.9% compared to 98% in 2005-06, is considered an important determinant of the increased revenue figure.