Bajaj Allianz

Bajaj Allianz General Insurance is a private general insurance company in India The company is a joint
venture between Bajaj Finserv Limited owned by the Bajaj Group of India and Allianz SE, a German
financial services company.
Industry Insurance Market Cap Rs.183944.36cr Revenue FY20 Rs.12,833cr
CEO Tapan Singhel Solvency 2.54 times Net Profit FY20 Rs.999cr
Founded 2001 ROE 18.5% Combined ratio 100.8%
HQ Pune EPS Rs.90.61 Market Share 6.8%

Market share ROE Combined ratio

Market share of Bajaj Allianz % Return of average equity % Combined Ratio %
7 19 102
18.5 100.8
6.8 6.8 18.5 101
6.6 18 100
6.5
6.4 17.5 99
6.3 17 98
6.2 6.2
6.1 16.5 97 96.7
16.2
6 6
16 96
5.8
15.5 95
5.6
15 94
FY2015 FY2016 FY2017 FY2018 FY2019 FY2020
FY2019 FY2020 FY2019 FY2020

Swot News and Facts Competitors

• Bajaj Allianz has a strong
• The company maintained a
network across 200 towns. It
credit rating of iAAA awarded
has about 722 offices that are
by ICRA for the 13th year in a
spread across India.
row, signifying our highest
• It is estimated that almost 27%
claims paying ability.
of India’s health-insurance
• Over the year, the company
pay-outs come from about six
issued over 26 million policies
cities. So there arise a lot of
and settled close to 6 million
opportunities for Bajaj Allianz
claims
to enhance the market.
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 Gross Direct Premium

Gross direct premium excluding crop,

Gross direct premium
Govt. health and Group health

Gross Direct Premium (Rs in Gross Direct Premium Excluding

crore) Crop, Govt. Health And Group
13000 12780 Health (Rs in crore)
9000 8904
12500
8800
12000 8600
8400
11500
11059 8200
8000
11000 8000
7800
10500
7600
10000 7400
FY2019 FY2020 FY2019 FY2020

• In terms of GWP, the Company’s growth was at 15.6% as against the market growth of 11.7%
(Private and Public multiline players).

• The Company maintained its 2nd rank during FY2020 with a market share of 6.8% which
moved up from 6.5% in FY2019. Excluding the bulky Crop, Government health and Group
Health business the growth for the Company was at 11.3% as against the market growth of
9.8%

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 Assets Under Management and Solvency

AUM Solvency Margin

AUM(Rs in crore) Solvency Margin %

19000
18746 255
255
18500
254.8
18000 254.6
254.4
17500
17237 254.2
254
17000 254
253.8
16500
253.6
16000 253.4
FY2019 FY2020 FY2019 FY2020

• The Company remains well capitalized and maintained very high levels of solvency
throughout the year.

• The solvency ratio as at 31 March 2020 stood at 254% (31 March 2019: 255%) which is
well in excess of the required solvency margin of 150%.

• The AUM for the Company grew by 8.8% in FY2020 to end at Rs. 18,746 crore at 31 March
2020 up from Rs. 17,237 crore at 31 March 2019

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 Profit after tax and expense ratio

Profit after tax Expense Ratio

Profit after tax(Rs in crore) Expense Ratio %

1200 30.5
30.1
1000 30

29.5
800
29
600
999 28.5
921 28.1
400 728 780 28
564
200 27.5

0 27
FY2016 FY2017 FY2018 FY2019 FY2020 FY2019 FY2020

• Profit before tax (PBT) during FY2020 was Rs. 1,376
crore as compared to Rs. 1,152 crore during the
previous financial year. The profit after tax (PAT) for
FY2020 was Rs. 999 crore as compared to Rs. 780
crore during the previous financial year.
• The growth in PAT was mainly on account of higher
realized investment gains and lower Corporate tax
rate.
• Increase in Expense ratios is largely
attributable to the investments being
made by the Company in new
channels of growth, including new
bank tie ups and investments in
technology.

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 Claims incurred

Claims Incurred Net Incurred Claims to Net Earned Premium

Claims Incurred % Net Incurred Claims to Net Earned Premium

71 82.00%

70.7
80.00%
70.5
78.00%

70 76.00%

74.00%

69.5
72.00%

70.00%
69

68.00%
68.6

68.5 66.00%

64.00%
68
62.00%

67.5 60.00%
FY2019 FY2020 2019-20 2018-19 2017-18 2016-17 2015-16 2014-15 2013-14 2012-13 2011-12 2010-11 2009-10 2008-09

• Claims ratio for the Company for FY2020 was 70.7% as compared to 68.6% in FY2019.

• Excluding NATCAT claims, claim ratio is at 69.4% (PY 67.9%). Despite the increase, we would have
amongst the lowest claims ratio in the industry.

• Worsening claims ratio is attributable to (a) Losses from a few natural catastrophise such as Fani
cyclone, Heavy extended monsoons in Maharashtra and Gujarat and floods in Kerala and (b) higher
crop claims ratio from 74.9% in FY2019 to 92.0% in FY2020 largely attributable to higher Kharif
season claims in FY2020.

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 Swot Analysis
Strengths
• It is one complete brand for all your
insurance requirements. It provides various
tending plans for life insurance and general
insurance.
• To benefit the customers, Bajaj Alliance also
has various online plans for life insurance and
general insurance.
• Bajaj Allianz has a strong network across 200
towns. It has about 722 offices that are
spread across India.
• Bajaj Alliance has received many awards.
Opportunities
• Bajaj Allianz has a strong competition as there
• It is estimated that almost 27% of India’s
health-insurance pay-outs come from about
six cities. So there arise a lot of opportunities
• To increase awareness of among people about
for Bajaj Allianz to enhance the market.
• As Bajaj Allianz insurance has various plans
for people of all ages, it does see a huge
opportunity with it.
• India being a large automobile sector, having
• Insurance Regulatory and Development
about 40 million vehicles, thus sees a large
opportunity in vehicle insurance.
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Weakness
• Bajaj Allianz Company has less access in the
rural areas of about six to seven percent, due
to which it is not reachable to many
customers.
• It has long and complicated procedures for
the customers to get insured. The procedures
might get cumbersome for the customers.
• It has small infrastructure as compared with
the leading players in insurance. Bajaj Allianz
has strong competitors with better offerings
and premium.
Threats
are about 11 private sectors that cater to the
Life Insurance sector alone.
securing their future is a big threat to the
company. Customers should be oriented in such
a way that they will be able to take the
premium.
Authority (IRDA) brings in stringent rules quite
often that increases the threat and burden on
insurance companies.
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 Findings

• During the lockdown phase between 19th March to 31st March 2020, company issued
569,461 policies and settled 271,772 claims along with maintaining an all-time low grievance
ratio, albeit amongst the lowest in the insurance industry.

• While grievance ratio stood at 0.006% which is amongst the Industry’s lowest, our Net
Promoter Score was amongst the highest in the industry, i.e. 52% and 51%, for Motor and
Health respectively.

• During the year, number of complaints increased by 15.0% from 1,103 registered in FY2019 to
1,268 in FY2020 with corresponding increase in number of policies from 21 million in FY2019
to 27.5 million in FY2020. Accordingly, the grievances per 10,000 new policies issued stood at
0.61 in FY2020 as against 0.53 in FY2019, this is amongst the lowest grievances across all
general insurance companies in the country

• On digital marketing initiatives, BAGIC website saw an increase of 12% over the previous year,
garnering 4.5 crore website visitors. The online campaigns impacted a reach of 42 crore
(including repeat, unique would be a quarter of these) with 19% increase in time session.
BAGIC has a lead position in number of followers and subscribers across all social media
platforms aggregating to over 26 Lacs across Facebook, Instagram, Linkedin, Twitter and
YouTube.

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 References

https://www.bajajallianz.com/about-us/financial-highlights.html

https://www.bajajallianz.com/download-documents/annual-report/Annual-Report-
2020.pdf

Prepared by:-
Preeti Choudhary

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