Although Niva Bupa Health Insurance currently has a 100 basis points headroom in terms of Expenses of Management (EOM) ratio, the insurer does not have plans for any extraordinary increase in spending this fiscal as its is looking to reduce the EoM, says its Executive Director & Chief Finance Officer Vishwanath Mahendra. In an interview with businessline, Mahendra says there are no plans to raise equity capital during this financial year. The company has the flexibility to raise debt up to ₹500 crore, if required, during H2FY27 under the board’s approved framework. Excerpts:Niva Bupa Health Insurance’s retail health market share improved to 11.1 per cent in the first quarter of this fiscal. What are your market share ambitions over the next few years?Our objective is to consistently grow 8-9 percentage points faster than the industry, which should enable us to continue gaining market share every year. The key enablers will be continued investments in distribution. Last year, we added nearly 1,000 sales professionals, and we plan to add another 1,000 sales employees this year across all our channels—agency, bancassurance, direct and third-party distribution.What is the contribution of the bancassurance and agency channels to your business? Do you expect the contribution from the bancassurance channel to increase over the next two-three years?Currently, bancassurance contributes around 19 per cent of our premium, while the agency channel contributes around 32 per cent, making it our largest distribution channel.We certainly want to maximise the potential across all our distribution channels. We have over 20 bancassurance partners, and we continue to invest in that channel alongside agency, direct and other distribution models. Having said that, it is difficult to predict the exact contribution of each channel because it ultimately depends on evolving customer preferences. Consumers may increasingly prefer buying directly or through digital platforms. Our strategy is to remain channel-agnostic and invest across all channels rather than target a fixed mix.Currently the insurer’s solvency ratio stands at 2.25x. It has declined compared to last year. What explains this?A: The solvency ratio was 2.86x a year ago. The higher base then was largely because we had raised capital during our IPO to support future growth. The current solvency position remains very comfortable and is entirely in line with our growth plans.Is there any plan to raise equity capital in this financial year?There are no plans to raise equity capital during this financial year. However, our board has approved an enabling resolution that allows us to raise up to ₹500 crore through debt instruments, such as non-convertible debentures, should the need arise. We have the flexibility to raise debt, if required, during the second half under the board’s approved framework.Our outstanding debt is around ₹250 crore, translating into a debt-equity ratio of approximately 0.07, which is very low.How is the company’s Expenses of Management (EOM) trending?Our Expenses of Management remain comfortably within regulatory limits. Against the allowable limit of 36.2 per cent, our actual EOM stands at 35.2 per cent, giving us a buffer of about 100 basis points.What is your EOM outlook for FY27? And Will you utilise the available 100 basis points headroom?We expect to remain comfortably within the regulatory limits throughout the year. We do not have plans for any extraordinary increase in spending. Our planned addition of around 1,000 employees is modest relative to our workforce of over 10,000 employees, and therefore we do not expect our EOM to move towards the regulatory ceiling.Do you expect EOM to reduce further over time?Yes. Our focus is on continuous optimisation. As our business scales, operating leverage naturally improves. This quarter, while premium grew by 32 per cent and retail by 47 per cent, expenses increased at a much slower pace. In addition, our investments in technology, analytics and AI are helping improve efficiency, which should continue reducing expense ratios over time.