Page 7 - Insurance Times October 2019

SBI General Insurance and Centre likely to reduce insurance premium rate for small

Karnataka Gramin Bank exporters, says Commerce Minister
sign bancassurance pact With an aim of reducing the insurance premium rates to 0.6% for small export-
ers, the Ministry of Commerce will soon approach
SBI General Insurance and the Cabinet, said the Union Minister.
Karnataka
Gr amin The minister said that the current premium rate
is 0.72%. Further, premium rates for exporters
Bank have
having outstanding limit of over Rs 80 crore will
recently en-
be streamlined with a view to help them. Such
tered into a
exporters will be divided into categories such as
comprehensive bancassurance deal
with an aim to provide the bank cus- non-gold, jewellery and diamond, among others.
tomers with a number of general "For accounts with limits below Rs 80 crore, the
insurance products. premium rates will be moderated to 0.60 per an-
num and for those exceeding Rs 80 crore, it will be 0.72 per annum for the
Along with this tie, SBI General In-
same enhanced cover," said Goyal.
surance has extended its distribu-
tion channels in the southern mar- He further said that Export Credit Gurantee Corporation of India (ECGC) has
ket and will distribute its insurance launched a new scheme Niryat Rin Vikas Yojna (NIRVIK). This will provide more
products all over the branches of comfort to banks to lend to exporters. The minister said the scope of cover
Karnataka Gramin Bank. The exten- has been enlarged to include not only the principal outstanding but also for
sive local presence of the bank will the unpaid interest for a maximum of two quarters or the NPA date, which-
be an added advantage for the in- ever is earlier.
surance company. The cover percentage has been enhanced to 90% from the present average of
Pushan Mahapatra, MD & CEO, SBI 60% for both principal and interest.
General Insurance, “The bancassur- The minister also said that the Export Credit Insurance Scheme (ECIS) envis-
ance channel has potential to reach ages simplified procedure for settlement of claim and also for provisional pay-
out to the last mile and serve un- ment up to 50% within 30 days on production of proof of end-use of the ad-
tapped markets thereby promoting vances in default by the insured bank.
the insurance penetration in India.
At SBI General insurance, we strive
to reach out to the furthest part of Arundhati Bhattacharya to invest in General Insurance
the society and spread awareness Biz
on insurance, and this partnership is In collaboration with Deepak Ishwarbhai Amin, former State bank of India (SBI)
in line with our objective. This asso- director and Sunil Mehta, former country head and
ciation will leverage the strengths of chief executive of AIG, former SBI chief Arundhati
both the companies, bringing Karna- Bhattacharya is all set to plan to start a general in-
taka Gramin Bank’s customers a surance business, said an inside source.
comprehensive suite of general In-
surance products.” Bhattacharya and Mehta had registered the com-
pany by the name of Welmo Fintech Pvt. Ltd on 3rd
Karnataka Gramin Bank is the big-
September. As per the data from the Ministry of
gest RRB of India having presence in
Corporate Affairs, the insurance firm has a paid-up
21 districts of Karnataka with 1167 share capital of Rs 1 lakh.
branches. The bank has a business
turnover of Rs 46,500 cr and is ser- According to the source, "They will soon be ap-
vicing 1.58 crore customers across proaching the insurance regulator to obtain an R1 approval.”
Karnataka. The deal will benefit the The report further said that Welmo will need a minimum of Rs 100 crore as
bank’s retail and SME customers paid-up equity share capital to secure the R2 (second stage) of regulatory ap-
spread across rural, semi urban and proval. The source further said, "They are looking to raise capital from ven-
urban areas of Karnataka state. ture capital investors.”
The Insurance Times, October 2019 7