SBI Life kicks off with 'Sanjeevan'

By Our Special Correspondent

MUMBAI, JUNE 15. SBI Life Insurance Company (SBI Life), a joint venture between State Bank of India and Cardif S.A., today announced the launching of its operations with its first product, ``Sanjeevan''.

Sanjeevan is a single premium money back product providing life cover up to a maximum of 75 years of age. Premium payment is followed by a deferment period after which the policyholder receives 5-10 annual instalments. The company has already sold around 100 polices after its soft launch. ``This scheme is mainly aimed at VRS optees,'' said Mr. Janki Ballabh, Chairman of SBI, while announcing the launch of operations of SBI Life here.

SBI Life is registered with an authorised capital of Rs. 250 crores and a paid up capital of Rs. 125 crores. The paid-up capital is likely to be raised to Rs. 175 crores before September this year. While SBI holds 74 per cent in the venture, 26 per cent is being held by Cardif. Cardif is a wholly owned subsidiary of BNP Paribas and is expected to provide the technical and marketing expertise in the venture. Till date, SBI is the only commercial bank that has been allowed by the Reserve Bank of India to enter the insurance business with this level of equity stake.

Mr. Ballabh said there were a number of products on the drawing board and several more were awaiting Insurance Regulatory and Development Aurhority (IRDA) approval. He said there would be more innovative products for rural and semi-urban and for different income groups. ``More single premium products and other polices, particularly those in housing, endowment are likely to be rolled out shortly once approvals are in place,'' he said, adding, ``our cost will be lower and the benefit will be transferred to the customer.'' Further, he said, ``we are going aggressively in retail banking, especially housing finance and consumer finance.'' The company is also looking at launching pension products in due course.

The SBI chairman said the large network of the bank would help its new role in insurance business. SBI Life was looking to market its product through its 9,024 branches of SBI as well as associate bank branches. In the first phase, 100 branches would sell the products, which has already been identified. In the second phase, 500 and the third phase 1,000 branches would sell the products. In the beginning the bank would be selling products through direct marketing. Mr. Ballabh also said the funds from insurance business were long term savings which could be used for infrastructure sector.

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