The Indian life insurance sector has seen robust growth for last 8-10 year. That is the primary reason why industry has seen so many new entrants and still so many applications with the regulator. The large portion of Indian population is insurable, but still the insurance penetration is very low and it provides a huge opportunity to increase their business. The Indian life insurance is expected to grow by about 15 percent in the current financial year. The industry is expected to make approximately Rs 2,55,000 crore for this financial year. Recently life insurance council Secretary General S B Mathur said that ‘Despite the slowdown in the economy, Life insurance industry has continued to grow as policyholders are realizing the value of insurance. We continue to be optimistic about the insurance business in India and expect the industry to grow approximately at 15 percent.’
He said that industry’s target of Rs 2,55,000 would be achieved this year. Insurance penetration in India is increasing, though very gradually. As per industry body, total renewal premium of 40 per cent in April-September period. These figures are more than enough to tell the story. If industry can grow so well after following one of the most deadly recessions, think about when economy is on full throttle. Regulator has played a pivotal role in development of the industry. They have been keen on protecting industry and consumer’s interest.
India has seen a lot of innovative products in last few years, which has helped it to consistently grow. From traditional products to child plans, it has come a long way but it is still in a very nascent stage. There are lot of changes which industry need to be undergo. Regulator has done lot of changes this year which will take some time to show their effects. A government appointed committee has suggested phasing out the commissions over a period of time. This is debatable as experts believe this is not a proper step to check mis-selling. Mis-selling of unit linked products has been the biggest cause of worry for regulator and insurance companies. Consumer awareness about products has been very low which is the primary reason for these kinds of practices. Insurance providers have been focusing a lot upon new product launches.
Stock market analyst believes that markets are going to be range bound for next 6-12 months period and inflation will reach a level of 6-8 percent. So next year may not witness a great year for life insurance because market related products forms the 80 percent of new business premium collection. But as the insurance industry has gone through the tougher times, it can be expected to go through this also.
About akhilendra
Speak Your Mind