Growing at an annual rate of 15%, Janashakthi Insurance anticipates a revenue surpassing Rs. 8 billion this year having maintained a 15% growth over last year’s revenue compared to the corresponding period up to now.
Janashakthi Insurance Managing Director Prakash Schaffter celebrating the company’s 18th anniversary yesterday stated that growth would primarily be based on the augmentation of General and Life insurance, which are expected to grow at an approximate rate of 12-15% during the year.
Known as one of the most profitable and stables insurers in Sri Lanka, Janashakthi holds the record for highest stated capital among quoted insurance companies of Rs. 1.49 billion with strong track record of claims payments topping Rs. 20 billion. The third biggest insurer in the country, the company topped Rs. 7 billion in turnover as at end 2011.
During the first half of this year, the company recorded a profit after tax of Rs. 164 million, declaring a dividend of Rs. 1 per share, notably the highest dividend yield in the industry.
“As at now we have a 12% share in the general insurance and a 5.5% share in the life insurance market in the country,” Schaffer said.
District-wise, the biggest growth spurt comes from the north east region, he said, which has picked up its business at a steady rate in the current post war conditions despite the premium volume dip experienced during the war. Janashakthi moved into the northern peninsula in the year 2000.
The growth rate in other parts of the country maintains an almost identical pattern. While the insurance industry in Sri Lanka itself has only an 11% penetration, which marks vast potential for growth in a fairly ‘unexplored’ market, Janashakthi is focusing on opportunities overseas as well.
“We have discounted some opportunities in overseas market,” Schaffer said. “However we are still open to suggestions.” He noted that the company was currently looking at the Maldives and expanding its presence there.
On a general note, he added that the local insurance industry penetration had increased only marginally over the years.
Noting the importance of educating the public on the importance of insurance, Schaffer stated that Rs. 60 million was spent per annum on human capital development within the company to train its staff prior to going out on sales calls, among other staff duties.
“The industry is a challenging one to operate in with stiff competition. However, we can overcome this. What is important is to create awareness to the public about insurance as a necessity and not just a want. The negative connotation that is generally associated with insurance must be set right.”
The company currently conducts door-to-door awareness campaigns, he said.
“This is an important year for Janashakthi. For 18 years we have transacted insurance business in the country. Having started with Life insurance and then moving on to General, we are today a composite company providing protection against risks across the island.”
Boasting over 100 branches islandwide with 13 branches in north and east, the company is the owner of one of the largest branch networks in the insurance industry. Commenting that a total of 13 were opened this year, Schaffer stated that the expectation is to open 10 more in the coming year.
A planned program to upgrade branches starting with the Negombo branch very soon would also take place over the course of the year. He noted that the company was looking at upgrading another 10 branches next year.
“We are a truly Sri Lankan company; a truly local success story,” Schaffer observed.