Karnataka Bank enters into MoU with LIC
A memorandum of understanding (MoU) has been established between Life Insurance Corporation of India (LIC) and Karnataka Bank for the sale of insurance products. The bank has recognised that customer’s needs are changing every day and they are moving firmly in the direction of improving customer satisfaction. The bank will now be able to provide a plethora of choices when it comes to life insurance products through each and every one of the 769 branches of the bank. LIC and Karnataka Bank are two time-tested entities that have been providing top-class services and products to its large customer base. LIC is one of the largest insurance agencies in the world and has a death claim settlement ratio of 99.90%. Both companies are looking forward to the future as this partnership is set to bloom.
24th May 2017
Insurance To Mostly Fall Under 12% Tax Bracket In GST, Say Experts
Following reports collected from sources in the tax consulting space, who have been working closely on the GST reform, have revealed that the GST council is not likely to reduce the tax to 5%. Currently, insurance policies are levied with a 14% service tax. There is also additional cess such as the Swachh Bharat Cess and Krishi Kalyan Cess which brings the overall payable service tax to 15% for policies with regular premiums.
However, rates for insurance policies will not be hiked to 18% as both the GST council and the government are of the opinion that insurance is a savings/protection product. Higher rates will only bring down its sales.
An official involved in the process said that if the GST rate is reduced to 5%, it will result in a huge deficit in tax collection. The committee has nearly reached a consensus on fixing the rate at 12% for insurance products. There is, however, no clarity, whether or not the rate will be different based on products or would it be universally applicable for all insurance products.
The GST is set to become effective from July 1, 201, after which there will not be any additional cess that will be applicable on any services. Therefore, if insurance products are charged a GST in the 12% bracket, policy takers will still be paying lesser money towards tax.
22nd May 2017
Centre Expecting Over 98% Renewals For Low-Cost Insurance & Social Security Schemes
The Central Govt. is hoping for more than 98% for its inexpensive social security and insurance schemes such as the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and the Pradhan Mantri Suraksha Bima Yojana (PMSBY) during the current fiscal year. To achieve this, the government is already ready with a plan. Banks and insurers already began the renewal improvement drive in the first week of May by publicizing and spreading awareness among people about the need to maintain enough balance in their accounts to enable auto debit of insurance premiums on a timely basis.
There are more than 12.5 crore policies which have been subscribed under these 2 schemes. Renewal premium for the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and the Pradhan Mantri Suraksha Bima Yojana (PMSBY) is Rs.330 and Rs.12, respectively, which is debited during May 21-31.
The PMJJBY comes with a life cover of ?2 lakh, valid for one year, renewable annually. It is available to all individuals between the ages of 18 to 50 years holding a savings bank account and covers death occurring due to any reason. The PMSBY scheme offers accidental death and disability cover worth up to Rs.2 lakh for partial/permanent disability for a duration of one year, renewable annually. Eligible applicants must fall within the age group of 18-70 years.
18th May 2017
Axis Bank looks for an insurance tie-up
In a bid to increase the reach of its insurance products to customers across the country and add more products to its portfolio, Axis Bank is on the lookout for another insurance partner. With the guidelines stating that a bank can have a maximum of three insurance partners, Axis Bank who already has a tie-ups with Max Life and LIC is scouting for a third insurance partner.
17th May 2017
Exide Life Insurance registers 27% growth in net profit
Exide Life Insurance has stated that the company has registered a growth of 27% in net profit which now stands at Rs.112 crore for FY16-17. The company registered a growth of 36% in the category of new business premium and a 18% growth in total premium. Kshitiji Jain, MD and CEO of Exide Life Insurance, stated that this exceptional rise in growth has been fuelled by the continued commitment shown towards its customers along with a world class array of products like protection, investment, and savings plans. The company is one of the biggest names in the insurance industry which serves over 15 lakhs customers located around the country and manages assets to the tune of Rs.11,000 crore.
12th May 2017
HDFC Life to work on merger with Max Life
Despite plans of the merger between HDFC Life and Max Life reaching the surface almost 9 months back, no regulatory has been passed. To speed the process, Keki Mistry, the CEO of HDFC Life has announced that they will go back to the rudimentary stages of the merger to make it a possibility. Based on a report, the CEO said that they will have to relook at the complete structure and see merger directly between HDFC Life and Max Life. The proposed structure was suggested because by doing so, HDFC Life gets listed by merging with Max Financial Services.
10th May 2017
Cheaper premiums for PM insurance schemes
The Government of India has promised to grant cheaper premiums for their insurance schemes like Pradhan Mantri Suraksha Bima Yojana (PMSBY) and Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY)for those who avail or renew such insurance products on or before June 1st. Those availing or renewing their insurances after the specified date (June 1) will have pay the premiums at the standard rate.
10th May 2017
The New POS Life Insurance Product by Edelweiss Tokio Life Insurance
Edelweiss Tokio Life Insurance on Friday launched its over-the-counter life insurance product in India. The product known as POS Saral Nivesh is a non-linked, non-participating, endowment plan which comes with the benefits of life protection and savings. You can opt for POS Saral Nivesh by a paying a minimum monthly premium of Rs.1,000 or an annual premium of Rs.5,000. The sum assured offered under the plan can range from Rs.50,000 to Rs.10 lakh. According to the company, POS Saral Nivesh is the first insurance product to be approved by IRDA after introducing the guidelines on Point of Sale Life Insurance Products.
9th May 2017
DPLI Registers PAT growth of 21% at Rs. 61.4 Cr in 2016-17
DHFL Pramerica Life Insurance (DPLI), one of India’s major insurer, recently announced a 21% growth in profit after tax (PAT). The corresponding profit figure stood at Rs 61.4 crore for the fiscal year 2016-17 as compared to the PAT figure of Rs 50.8 crore in FY16. The company’s Gross Written Premium (GWP) rose by 24%, stopping at Rs 1,142 crore in FY17 as compared to Rs.920 crore in last financial year. The insurer’s Collected New Business Premium (NBP) also increased by 20%, touching a figure of Rs 874 crore as compared to Rs. 727 crore in the last financial year. DPLI’s asset under management (AUM) increased by 31%, touching a figure of Rs 2,707 crore in 2016-17 as compared to the AUM for 2015-2016 which stood at Rs 2,072 crore.
Commenting on the figures, Mr. Anoop Pabby, MD & CEO at DPLI said that DPLI had performed very well across all areas like quality, customer centricity, growth and profitability. He added that the results are no surprise given DPLI’s ‘commitment towards building a customer-centric culture, a sharply segmented approach to distribution, investments in digitization and technology and launch of innovative and relevant products.’
5th May 2017
SBI Life Insurance Sees 31% Rise in Net Profit
SBI Life has recorded a growth in its net profit by 31% in Q4 of FY 2016-17. It’s net profit stands at Rs.336 crores, a sharp rise from the same quarter’s profit last year of Rs.256 crores. SBI Life’s individual new business premium (APE) also climbed up by 40%, indicating a profit of Rs.2,213 crores in Q4 of FY 16-17. For the same quarter last year, SBI recorded Rs.1,586 crores. Being one of the most trusted insurance companies in India, SBI Life Insurance has been able to round up a huge customer base. The company became the first private life insurer to go beyond the Rs.10,000 crore mark in New Business Premium. MD and CEO of SBI LIfe, Mr. Arijit Basu, stated that the last quarter for FY 2016-17 was excellent in terms of business and quality.
4th May 2017
Life Insurance companies witness growth in digital payments for premiums
Following the demonetisation of high-value tenders by the Modi-led Government on Nov 8, 2016, Life Insurance companies across the country have experienced record premium sales through digital payments or non-cash payments. Swiftly aligning with the vision of the government - the digital or cashless drive - insurance companies have given customers the opportunity to make online payments for their premiums. According to a source, digital payments have risen from 55%-60% to 75%-85%. According to an insurance executive, the growth has been seen largely in urban areas but the convenience of digital payments for premiums is rapidly taking a grip over rural areas as well.
3rd May 2017
Reliance General Insurance racks up Rs.4,007 crore in FY17
Reliance General Insurance Company Ltd. has amassed a total gross premium of Rs.4,007 crore in the financial year of 2017. This figure dictates a growth of 40% for the company when compared to the numbers of previous years. The company recorded a growth of 32% last year by racking up Rs.130 crore as profit before tax. The Return on Equity (RoE) has seen an improvement, standing at 11% from the previous year’s 9%.
Reliance General has insured over 3 million farmers who come under the Pradhan Mantri Fasal Bima Yojana. The company’s online channel recorded a growth of 55% and saw a growth of 66% in the number of policies that were sold during this period. With a market share of 7.3% in the private sector, the company now aims at strengthening its distribution network by forging partnerships with top-tier banks like Catholic Syrian Bank, Andhra Bank, IndusInd Bank, and Bank of India.
28th April 2017
Edelweiss Tokio Life Insurance obtains approval for “POS-Saral Nivesh”
A joint venture between Edelweiss Group and Japan based Tokio Marine Holdings has received an approval from the IRDAI for “POS-Saral Nivesh” and this will be sold to customers over the counter. Edelweiss Tokio is the first to receive an approval from the IRDAI (Insurance Regulatory & Development Authority of India) to sell a product like this through POS channels and this is a category that is being explored in India for the first time ever. This product is aimed at providing a hassle-free process and instant gratification to customers who are seeking the same. The purchase process is simple, quick, and easy and takes only a few minutes to be completed. MD and CEO of Edelweiss Tokio Life has stated that the company is excited on receiving the approval required from the IRDAI and will be keen to see how the product will develop.
27th April 2017
MSRTC increase insurance cover to Rs.6.15 lakh
In the MSRTC (Maharashtra State Road Transport Corporation) board meeting held on 20th April, it was decided to increase the life insurance cover to Rs.6.15 lakh, in case of sudden death of an employee. The previous cover was of Rs.3.65 lakh. Diwakar Raote, MSRTC Chairman and State Transport Minister announced that the hike may take effect from 24th May. Apart from this, MSRTC also decided to reduce the secondary salary slab from three years to one. Although this has been a welcome step for MSRTC employees, they have been demanding a salary hike since many years, which has not received any response from the transport utility.
25th April 2017
Life Insurance Segment Registers 26% Rise in Group Single Premia Income in FY17
Group single premia products which make up for nearly 60% of LIC’s business recently witnessed an increase, boosting the overall new premium income of the life insurance industry by 26% in FY17. The new figure stands at Rs 1.75 trillion, as opposed to Rs. 1.39 trillion recorded a year back.
For the other 23 private players in the insurance segment, the boost in growth can be attributed to group single products, which contribute to nearly 30% of the company’s business. The industry’s income from group single premia rose by 23%, to Rs.88,559 crore, followed by individual non-single premia which rose to Rs.50,500 crore.
24th April 2017
Kerala State Government to introduce insurance scheme for pensioners, govt employees
The state government of Kerala will soon be introducing an insurance plan for its service pensioners and government employees. The scheme is expected to benefit about 4.5 lakh government employees and teachers and 5 lakh pensioners. The decision was taken by the cabinet based on the suggestions of the 10th Pay Commission.
Once the scheme is implemented, pensioners and employees will be able to avail cashless treatment at network hospitals. The government will bear the hospitalisation costs of these insured members. The insurance would offer coverage for outpatient treatments and pre-existing diseases as well.
The medical reimbursement plan that is followed currently will be in force till the new insurance scheme is implemented. The interest-free loan that is currently provided for treatment of government employees and teachers will also be made redundant on introduction of the new scheme.
The employees will be expected to pay Rs.300 as monthly premium towards the plan. The medical allowance of Rs.300 that the government currently pays pensioners will be stopped once the insurance scheme is implemented.
The introduction of the insurance plan will substantially reduce the medical expenses borne by the government. For the implementation of the plan, applications from IRDA-approved insurance companies will be invited soon. Public sector insurers may be given priority over the private players while bidding for the scheme.
21st April 2017
Demonetisation proves positive for the life insurance sector
While most businesses in the country came to a complete standstill following the demonetisation of high-valued tenders by the Modi-led government, the life insurance sector rose to a 9-year high. According to sources, the life insurance sector grew by 16% and private insurers grew by 26% in the total number of premiums availed, giving the overall life insurance a 21% boost. A member of Kotak was quoted as saying that he expects the current momentum in life insurance/capital market inflows to continue in FY 2018 as investors continue to shift to financial savings from physical savings.
20th April 2017
New business premium income of life insurers went up by 26%
Amid dropping deposit yields and increasing liquidity, new business premium income of life insurers climbed 26% in March 2017. The move was spearheaded by the industry’s growth with the help of individual single-premium policies. Life Insurance Corporation outperformed other private insurers by reporting a growth of 27%, compared to its rivals who recorded 24%. LIC’s growth was aided by an 84% growth in its single-premium revenue. According to the latest data from the Life Insurance Council, new business premium for the financial year 2017 was at Rs.1.75 lakh crore from the previous year’s Rs.1.35 lakh crore. While, private insurers recorded a rise in new business premium from the previous year’s Rs.40,983 to Rs.50,625 in FY17.
19th April 2017
Gujarat High court pleas to the Reserve Bank of India to increase insurance on bank deposits
On April 12, 2017, the Gujarat High court raised a plea with the Reserve Bank of India to hike the insurance on deposits for bank accounts. The current insurance for deposit accounts stands at Rs.1 lakh, and fearing its past of bankruptcy, the Gujarat High court has pleaded with the RBI to increase the insurance from Rs.1 lakh to Rs.10 lakh.
13th April 2017
Non-life insurance up by 32% in the Financial Year of 2016-2017
According to the IRDAI, the gross premium collection in the non-life insurance sector has risen by 32% since last financial year, amounting to Rs.1.27 lakh crore. As per the date compiled by the IRDAI, public sector firms showed a rise of 28.9% in gross premium in 2016-17 to Rs.67,689.68 crore as against Rs.52,520.80 crore a year earlier. In the case of private sectors, premium for 2016-17 rose by 41.12% to Rs.5,859.80 crore against Rs.4,152.31 crore.
12th April 2017
LIC drops Shares in SBI
Life Insurance Corporation of India sold off more shares it was holding in State Bank of India. The popular insurance company previously reduced its stake in SBI from Rs.75.87 crore to Rs.70.31 crore. At the end of the quarter January-March 2017, LIC’s share fell to 9.94%, while MFsat held 8.42% and FIIs held 9.48%. Analysts say that LIC was geared up for profits in SBI, however after the demonetisation scheme was introduced, demand dropped and the industry slowed down. Overall, LIC’s holdings in 23 banks has dropped by 30%. In December 2015, LIC held Rs.38,373 crore in these banks which has now been reduced to Rs.26,837 crore, the lowest scene in four years.
11th April 2017
Insurers hike premiums in certain categories of insurance
General insurance companies have increased the premiums for certain categories of products in the new fiscal year. April is the time when most of the customers renew their policies. IRDA reports suggest that motor insurance, fire, and group insurance premiums have gone up by an average 20%. Areas such as property insurance too have witnessed a significant rise in premium amounts. While some segments of insurance remain unaffected, others have implemented loss-based revisions to the plans offered by them. The insurance industry closed FY 2016-17 at Rs.1.23 lakh crores which is comparatively higher than the sales figures recorded for the FY 2015-16.
10th April 2017
SBI Life Insurance Prepared to Launch IPO
State Bank of India’s life insurance arm, SBI Life Insurance recently announced that they have started preparing for the process of launching an IPO (initial public offering). In a statement, the bank said that it aims to divest about 10% through the IPO. However, SBI has not received approval for the same from the market regulator so far.
SBI Life Insurance was established following a joint venture between SBI and BNP Paribas Cardif where a majority of 74% of the stake is held by SBI, while the remaining id held by BNP. By the end of September, SBI Life Insurance is expected to get all the necessary regulatory approvals and clearances. SBI Life Insurance's IPO follows suit after ICICI Prudential Life Insurance, leading private life insurer, managed to raise Rs 6057 crore through their IPO which was launched in September 2016.
6th April 2017
Bajaj Allianz Life Insurance appoints new MD & CEO
Bajaj Allianz Life Insurance has announced the appointment of Tarun Chugh as the company’s new Managing Director & CEO. Chugh will replace Anuj Agarwal, who has been moved abroad but within the Allianz group. Chugh comes with over 22 years of experience in the world of financial services which includes 12 years of experience in the life insurance sector. Tapan Singhel was awarded another 5 year term as the Managing Director & CEO of Bajaj Allianz General Insurance. During his tenure, Bajaj Allianz has introduced the benefits of insurance to people residing in over 800 Tier II and Tier III towns in the country.
5th April 2017
Three shortlisted to hold 35% stake in ICICI Lombard
Private equity funds, Warburg Pincus, Temasek, and Carlyle are the final three to contend for 35% stake in ICICI Lombard General Insurance Company Ltd. As per reports, the deal is expected to fetch up to $1 billion. The three companies were shortlisted after bids were received from four potential investors last week.
The other contenders in the list were KKR, Blackstone, General Atlantic, and Advent. A final round of due diligence will be conducted before binding offers are submitted at the end of April this year.
Temasek is an existing investor in ICICI Prudential Life Insurance, whereas Carlyle and Warburg lack sizeable stakes in the Indian insurance sector.
4th April 2017
IRDAI Proposes Life Insurance to be Issued in Demat Format
The IRDAI (Insurance Regulatory and Development Authority of India) has proposed to make the issuance of life insurance policies in demat format. The IRDAI has been trying to get insurance companies to switch to the demat form since 2013, but LIC (Life Insurance Corporation) has always resisted the move on grounds of data safety and its widespread geographical reach including rural areas. The new proposal suggests that all life policies beyond a specific premium threshold should be issued in the dematerialized form. It will affect both new and existing customers. At present, there are over 360 million life policies in force and it's expected to grow by an average of 12% to 15% in the coming five years.The demat format will provide a paper free, single view format that will be safer. It will help bring down processing fees and reduce premiums.
31st March 2017
Tata AIA Life Launches mInsurance - Mobile Insurance
With everything going mobile, it is about time that insurance policies also become available online. Tata AIA Life Insurance has made that thought a reality with the launch of their new mobile insurance product called mInsurance. This unique mobile insurance facility will allow customers to purchase term insurance cover simply with a recharge using a ‘special tariff voucher'. Tata AIA Life has only launched a pilot plan of the mInsurance in association with Tata Teleservices Limited in the states of Telangana and Andhra Pradesh.
The mInsurance paperless cover is available to all Indian citizens who are aged between 18 to 80 years. there are no medical tests required to purchase this paperless cover. Customers who purchase from a select range of Tata DoCoMo mobile recharge coupons (Special Tariff Voucher or STV) will be auto-enrolled in this paperless life cover plan. This plan is available under 2 sum assured options of Rs 50,000 and Rs. 1,00,000. The details about the life insurance cover are sent to the customer via SMS which consists of the web link from where the customer can download the insurance certificate. In case a claim has been raised, the customer needs to contact the Tata AIA Life call center to proceed with the settlement.
31st March 2017
State Bank of India All Set To Dilute 10% Of Its Stake In The Life Insurance Venture
One of the leading banks in India, State Bank of India, recently stated that they have planned to dilute 10% of its stake in the life insurance venture SBI Life through public offer. The Executive Committee of Central Board has given approval to initiate the process to sale 10% of shares through initial public offer. After this stake sale, SBI’s stake came down to 70.1% from 74%. The insurer has an authorised capital of Rs 2,000 crore and a paid up capital of Rs 1,000 crore.
30th March 2017
SBI to begin process for IPO of life insurance arm
State Bank of India (SBI) has announced that they will soon begin the procedure for an Initial Public Offering (IPO) of the life insurance wing of the bank. The bank plans on selling 10% of its stake. The bank has stated that it would sell 8% stake in SBI Life while a senior executive of the bank has stated that BNP Paribas, who is a partner in this joint venture, will sell a stake of 2%. BNP Paribas Cardif owns 26% of the life insurer while SBI owns 70.1%. This move by SBI comes after the share sale that was made by ICICI Prudential Life Insurance Co. Ltd. in September last year.
28th March 2017
Insurance cover for HIV/AIDS patients a distant dream, expensive despite Bill
Patients who are suffering from HIV or AIDS continue to have zero respite in terms of insurance coverage even though there exists a Bill which has made it compulsory for State and Central governments to not only penalize discrimination and provide treatment to HIV-positive individuals. HIV and AIDs affected patients are considered high-risk by insurers who are more likely to charge them significantly higher premiums, say insurance experts.
According to the Bill, the insurance provider is supposed to determine the amount of cover which will be required by such an affected person based on actuarial evidence. However, since both HIV and AIDS are primarily venereal diseases, there is prominent stigma which accompanies such diseases. Due to this reason, patients are often refused insurance cover not only by public but also private insurers.
When it comes to preventing discrimination, the bill clearly states that an HIV positive diagnosis must not become a cause for an employer to discriminate against an affected employee. However, things are quite different in real life. Insurance providers often decline to provide insurance cover to any HIV-positive patient who is a part of the group insurance plan, as such a person is considered a high risk.
Both life and general insurance segments have been steering clear of providing insurance to AIDS/HIV positive patients due to absence of concrete data regarding pricing for such patients.
However, in India, the Star Net Plus policy by Star Health Insurance was the first policy which offered cover to HIV- positive people. individuals.
23rd March 2017
General insurance companies observe gross premium growth of 32%
General insurers have continued their positive performance streak and have observed a 32% gross direct premium growth in FY17, till February. The premiums had crossed Rs.1 lakh crore for the first time in January 2017, primarily due to the flourishing motor and health insurance market.
The data released by the General Insurance Council (GIC) shows that the gross underwritten premium by the industry this year was Rs.1.13 lakh crore, when compared to Rs.86,526 crore in February last year, marking a growth of 31.69%. Private insurance companies saw a 33.8% growth in the gross premium income when compared to last year, while public sector insurers saw a growth of 24.47% this fiscal.
Private sector insurance companies have seen higher growth in this sector, largely due to the improvement witnessed in the crop insurance industry. As per statistics, the general insurance segment has received premiums worth Rs.14,000-16,000 crore from the crop insurance segment. It is likely to reach Rs.18,000-20,000 crore by the end of this fiscal. The growth observed by specialised players such as AIC and ECGC is also significant.
23rd March 2017
Online account for storing insurance policies will soon be a reality
The Insurance Regulatory and Development Authority of India (IRDAI) may mandate the use of an online insurance repository by the end of 2018. The proposed electronic insurance account will be a storage space for insurance policies in the digital format.
Users will be able to view their policies and make alterations, if needed. The electronic insurance system promises security, speed, and accuracy in insurance policy maintenance and change management.
One of the main objectives of the plan is to make the policy document available as an e-policy to the user even in the event of loss or misplacement of the hard copy. If implemented, India will be the first country to have such a system in place.
When the repository has tied-up with all insurers, the policyholder will be able to access all his/her insurance policies on one platform. Updation of the KYC can also be performed in the online system. Additionally, the move is expected to save the insurance industry around Rs.100 crore per year, as the costs associated with the physical maintenance of policies will not exist.
22nd March 2017
IndusInd Bank has plans to launch its own general insurance company.
IndusInd Bank is currently a bancassurance partner for Religare health insurance and Cholamandalam general insurance. The bank is evaluating the possibilities of setting up their own company to not just be a distributer but to also offer their own general insurance products. The idea is only in infant stages and a proposal has not yet been passed by the board. Many other public sector and private banks are exploring opportunities to set up their own distribution networks to sell insurance products from different insurers. General insurance is an industry that is not as cash intensive as life insurance. Companies are proven to turn a profit in about 5-7 years.
17th March 2017
IRDAI puts hold on mandatory listing of insurance firms
The Insurance Regulatory and Development Authority of India (IRDAI) announced that it has not yet made it mandatory for insurance companies to be listed. The reason for this is that the insurance industry is simply not ready for it. Currently, the only listed insurer is ICICI Prudential Life. Last August, the IRDAI had brought up a discussion about making the listing mandatory for insurance companies that have been operating for 10 years. The discussion has remained in the form of a draft as the industry was not happy with it. Presently, there are 55 insurance companies in India. 31 are general insurers while 24 deal with life insurance. Recently, there was a significant hike introduced in third party liability vehicle insurance premiums. The insurance regulator also stated that there was room for a hike in premiums of group health insurance policies. This would help make the insurance industry much more viable.
16th March 2017
Birla Sun Life Insurance survey suggests women are underinsured in India
According to a survey report published by Birla Sun Life Insurance, women in India are underinsured. The report states that only 50% of women in the urban regions have life insurance coverage. It also suggests that 72% of their male counterparts have purchased life insurance products.
When the total women population in the country is taken into account, these figures are well below the expected levels. Birla Sun Life Insurance revealed that women account for only 23% of their overall customer portfolio.
Pankaj Razdan, MD and CEO of Birla Sun Life Insurance said that due importance is not given to the risks faced by women, and it is crucial for them to be equipped with a life insurance policy. The report also suggested that only 26% of women get themselves insured at an early age, i.e., when they are between 20 and 30 years of age. It also stated that more women in the middle income group purchase savings-linked life insurance products. Wealth-related products are more popular among women in the low income group. The survey also reveals that women who earn higher incomes plan better for their retirement by purchasing pension-related products.
The report further states that there has been an increase in cases where women have been beneficiaries in life insurance policies.
10th March 2017
Growth of First Year Premium Significant in FY16
The life insurance industry which consists of 23 private firms and one state-owned company (LIC) have recorded a significant rise worth more than Rs. 1.38 lakh crore by way of new policies. The life insurance segment led by LIC sprang back in 2015-16 and recorded a growth of 22.5 % by in terms of first year premium, as opposed to a drop of nearly 6% for the same period a year back.
According to the data released by IRDAI, Life Insurance Corporation of India (LIC) recorded a growth of 24.69% by the sale of new policies and collected Rs. 97,891.51 crore in the financial year ending in March 2016. In the year 2015-16, the life insurance industry on a whole recorded a dip of 13.55% in growth in terms of first year premium. Leading banks and NBFCs like SBI Life, HDFC Standard Life, ICICI Prudential, Bajaj Allianz, Birla Sunlife and Max Life were some of the insurance players in the private sector who recorded a growth in the first year premium during 2015-16. Other insurers such as Reliance Nippon, Aegon, Aviva and Exide Life registered a drop in the premium earnings.
9th March 2017
New Regional office opened in Bhopal by SBI Life Insurance
SBI Life Insurance has now opened a new regional office in Bhopal. Arijit Basu, Managing Director and Chief Executive Officer, SBI Life Insurance, inaugurated the regional office in the presence of K.T. Ajit, CGM of SBI, Bhopal Circle, and Anand Pejwar, Executive Director, Marketing, SBI Life Insurance. SBI has extended its support to specially-abled children to facilitate easy conveyance to the Ability Development Centre which is run by a voluntary organisation called Arushi which is based in Bhopal. There are close to 150 children who train at this centre. These kids are either visually impaired or have some other physical impairments. Basu has said that SBI Life has observed a remarkable growth and the company is expanding its reach to Chhattisgarh and Madhya Pradesh.
08th March 2017
Reliance General Insurance partners with Catholic Syrian Bank for expansion
Reliance General Insurance and Catholic Syrian Bank have entered into a partnership with a vision to expand the insurer’s distribution network. Reliance General Insurance was earlier associated with several banks, including UCO Bank, for the distribution of their insurance products.
Reliance General Insurance CEO, Rakesh Jain, mentioned that their business through banks stood at Rs.50 crore in 2015-16. In the current financial year, they aim to earn around Rs.200 crore from sales through this channel. The company intends to boost its topline by up to 15% through these tie-ups.
As part of the alliance, the insurer’s products will be offered to 1.5 million customers of Catholic Syrian Bank, across 430 branches in the country. CVR Rajendran, MD and CEO of Catholic Syrian Bank, said that the tie-up will bring together the banking and insurance needs of their customers under one roof.
06th March 2017
ETMoney and HDFC Life jointly launches data-led insurance plan
ETMoney, a personal financial app backed by Times Internet, in alliance with HDFC Life has launched a data-led group term insurance plan. This plan, based on the spend pattern of the user, will be the first of its kind in the country.
The policy is offered to more than 1 million users of the ETMoney financial application, and it has a coverage between Rs.25 lakh and Rs.50 lakh. ETMoney users can also avail tax benefits under Section 80C of the Income Tax Act. These savings could be up to 30% of the premiums paid.
Mukesh Kalra, COO of ETMoney, mentioned that the millennials in India are currently underinsured. The newly introduced term plan will be a simple, cost-effective, and paperless method of starting their insurance journey. The company is also happy to be in partnership with an industry leader such as HDFC Life.
HDFC Life MD and CEO, Amitabh Chaudhry, mentioned that they are proud of the fact that their association with ETMoney will help them reach out to the young customer through the popular financial app.
2nd March 2017
Credit enhancement guarantee fund to be launched by LIC, IIFCL
The government has finally made a decision to make India Infrastructure Finance Co. Ltd (IIFCL) as a lead promoter for a credit enhancement fund which was announced in the Union budget in February 2016. The fund which amounts to Rs.1,000 to Rs.1,500 crore is set to be announced in the month of April as the government is in talks with different foreign and domestic banks. In the initial stages, LIC was fixed as the lead promoter. But, life insurance norms states that LIC is not allowed to hold a stake of 20% or more in companies such as these. The credit enhancement fund will provide a further assurance that a loan borrower will ensure that their loan will be serviced.
27th February 2017
Oriental Bank Has Partnered With Chola MS To Offer Insurance Products
One of the leading private banks in India, Oriental Bank of Commerce, has joined hands with Cholamandalam General Insurance Company to offer a wide range of non-life insurance product. Going forward, Chola MS will sell their non-life insurance products to Oriental Bank of Commerce customers. Travel, motor, health, and home insurance are some of the insurances that will be sold by Chola MS. Animesh Chauhan, MD and CEO of the Oriental Bank of Commerce stated that they are happy to have partnered with Chola MS and are going to bring the best non-life insurance products to their customers. He further stated that Oriental Bank of Commerce customers will greatly benefit from this partnership.
23rd February 2017
Life Insurers Report 35% Growth In New Business Premium
The Life Insurance Industry in India reported a growth of 35% in new business premium as on January, 2017. The reason for hike in new business premium is mainly due to significant growth in the group as well as individual single premium policy. State owned Life Insurance Corporation of India(LIC) reported relatively higher growth than the private insurers. While the private insurers reported a growth of 26.31%, LIC recorded 39.06% growth in this financial year. A report from the giant of insurance industry, Irdai (Insurance Regulatory and Development Authority of India) supports this statistic. According to the report from Irdai, Rs.29 lakh crore new business premium was recorded by the Life insurance industry in India in this financial year. In the previous financial year, life insurance industry earned Rs. 85,871.62 crores premium.
23rd February 2017
IndiaFirst Life looks to double revenues in FY17
IndiaFirst Life Insurance is looking to double its profits in the financial year 2016-17, from the Rs.7.72 crore mark seen in the financial year 2015-16. RM Vishakha, MD & CEO of IndiaFirst Life Insurance, said that digitised mass markets and the rural domain will be the prime focus of the company. The insurer gets a large chunk of its income from distribution of policies at banks.
Vishakha mentioned that about 90% of Andhra Bank branches were responsible for the sale of a policy throughout the year. Out of this, almost 60% of branches have sold an insurance product every alternate month. She also stated that 70% of the Bank of Baroda branches were selling insurance policies.
Vishakha said that the opening of bank branch network to multiple insurance companies should not be mandated, as the banks have a large responsibility of selling policies. She also mentioned that the company has seen a 90% growth in premium in the individual segment, on an annual basis. Vishakha stressed that the company is looking to make a big entry into internet marketing, and the launch of their new website is a precursor to this. The CEO also stated that the company has reached almost 75% persistency in the renewal of insurance policies, a figure that is much higher than its competitors.
22nd February 2017
Irdai To Form Actuary Panels For Life Insurance
The Insurance Regulatory And Development Authority of India (Irdai) is all set to form dedicated panels for life insurance, health insurance, and other general insurance. Irdai has invited bids from actuaries ad firms who employ analysts to form the panel of actuaries. According to the bid document, each panel will be valid for a period of three years. For this year, the panel will be active from 1st April 2017 to 31st March 2017. The panel would be asked to give an opinion on the products filed by an insurer. Another responsibility of the panel will be to investigate the financial position of any insurer or to give a valuation report. The actuaries will also be required to approve the new products with their inputs and certification.
21st February 2017
Launch of Life Pragati policy from HDFC Life
Private life insurer, HDFC Life, has unveiled the Life Pragati policy that is targeted at the low income families in India. With the launch, they intend to widen the reach of life insurance to every single household in the country. The policy offers ‘with-profit’ life coverage that enables savings to grow with guaranteed premium returns. The plan, apart from enabling customers to save for future milestones, also provides financial protection to endure the uncertainties in life.
At the launch of the product, the insurer stated that they have dedicated this product to the lower income group that constitutes almost half the population of India. They intend to help this strata of the society save for their future and also receive protection, without making a significant impact on their monthly income.
20th February 2017
Post 3 years of launch, e-insurance still not seeing expected response
As per current estimates, out of the 9.875 crore insured Indians, only 9 lakh have opened e-insurance or DEMAT accounts. This amounts to a mere 0.9% of the total insured population, indicating that the e-insurance initiative has not taken off like the other schemes introduced by the Government.
e-insurance accounts are of immense help in events like tsunami or floods where people lose all vital documents that prove their identity. Data repositories opine that the biggest hurdle to the success of the initiative is the non-participation of LIC. Also, while the IRDAI has been in the forefront promoting the initiative, they have not mandated it. Another roadblock is the non-participation of majority of the general insurance industry in the initiative. Although 24 life insurance companies have signed up for e-insurance, only 8 general insurance companies have endorsed it. In addition, data repositories state that some life insurance companies consider establishing the infrastructure for e-insurance as an unnecessary cost.
ICICI Lombard stated that more awareness needs to be created on the benefits of having an e-insurance account. The insurer is also trying to propagate the initiative through emails and social media.
20th February 2017
Launch of Aviva Heart Care, India’s first heart insurance plan for couples
On the occasion of Valentine’s Day, Aviva Life Insurance has unveiled the first heart insurance plan for couples in India, Aviva Heart Care. The plan provides cover for 19 severe, moderate, and mild cardiovascular diseases and procedures. A lump sum payment is made to the insured, irrespective of the treatment costs.
The plan is unique as it provides coverage exclusively for cardiovascular conditions. The customer can avail coverage for his/her spouse as well, under the same policy at an additional premium. The plan has options for restoration of policy benefits when the basic sum assured is exhausted. The insurer claims that the plan is an answer to the problems faced by people who often have to depend on mediclaim or critical illness plans for such ailments. The coverage offered by mediclaim or critical illness policies may not provide a substantial payout, unlike the Aviva Heart Care plan.
Other benefits of the plan include:
- Comprehensive cover provided for 19 cardiovascular conditions.
- Multiple claims can be raised, based on the severity of the condition.
- Double coverage is offered for severe category ailments for both the policyholder and spouse.
15th February 2017
Life insurance segment observes 11% rise in premium during Apr-Jan this fiscal
The improvement in the spending capacity of the common man owing to the rise in per capita income has contributed to the spike in premiums collected by the insurance segment. The data released by the Insurance Regulatory and Development Authority of India (IRDA) has indicated that the premium collection by non-life insurance companies has risen by 31.7% in the fiscal 2016-17, to stand at 1.04 trillion rupees. On the other hand, life insurance providers observed a rise of 11% in AUM, when compared to the last financial year.
The highest premium was collected by leading insurer, New India Assurance Co. Ltd., and this amounts to 156.4 billion rupees. ICICI Lombard tops the list of private sector general insurers with a premium collection of 91.4 billon rupees.
The data also showed that public sector insurance companies mopped up 558.1 billion rupees, while private players collected 478.5 billion rupees during this interval. This clearly highlights the growth witnessed by the insurance sector and the stiff competition therein.
15th February 2017
Life Insurance Corporation raises stake in Infosys
Despite the fact that Infosys has made news with their top bosses involved a fearsome tussle, Life Insurance Corporation has increased its stake in Infosys to 7.02%, proving that it still has faith in the growth of the company. The largest institutional investor in the market, Life Insurance Corporation increased its stake by 4.45%. Earlier, the insurance company held a 3.25% stake in infosys, and the move makes them Infosys’s largest stake holder. Experts estimate that now Life Insurance Corporation now holds stakes amounting to more than Rs.1,400 crore.
14th February 2017
PNB MetLife to introduce ‘Mera Heart and Cancer Care’ unit linked insurance plan
PNB MetLife announced that they will soon be launching the ‘Mera Heart and Cancer Care’ plan to customers in India. MHCC will be a non-participating health insurance plan that provides significant benefits to cancer and heart patients across the country.
The plan is tailor-made to offer comprehensive insurance coverage throughout all stages of heart diseases and cancer. The coverage under the plan offers a lot of flexibility, and buyers can customise it to avail special benefits for women at the payment of special premiums.
07th February 2017
Indian Government may list 5 state-run general insurer to raise $1.6 billion
In the next few months, the Indian Government may list out five state-run general insurers who would raise its stake sale to $1.6 billion in this fiscal year. In the recent budget announcement, the government claimed that there will be sale of unspecified stakes in United India Assurance Co. Ltd., New India Assurance Co. Ltd., General Insurance Corp of India, and National Insurance Co. Ltd. Bankers are expecting the sales to start by December. The insurance stake sales was approved by the Indian federal cabinet in January. It was decided at that time that the stakes in the companies would be cut in one or more tranches from 100% to 75%.
3rd February 2017
Shares of ICICI Pru go up by 3% on cabinet’s approval for listing government-owned general insurance companies
With the cabinet’s approved list of government-owned general insurance companies at the stock exchanges, the shares of Max Financial Services and ICICI Prudential Life Insurance Company have gone up by 1 – 3%. The government intends to lower its stake from 100% to 75% in five companies, namely – the United India Insurance, New India Assurance, General Insurance Corporation of India, Oriental Insurance, and National Insurance.
The listing is expected to make way for these companies to source resources from the capital market for expanding their businesses, instead of depending on the Government.
27th January 2017
Insurance industry to seek higher exemptions in tax in the upcoming budget
Following demonetisation, the insurance industry is expected to focus on e-payment, compulsory home insurance, and higher tax exemptions in the next Union Budget. The insurance industry expects the upcoming budget to bring about a level playing field for annuities in the life insurance sector, resulting in more pension and retirement savings. MD and CEO of Edelweiss Tokio Life Insurance, Deepak Mittal said the expectations from the budget is to spur consumption with the help of higher tax-free slabs combined with higher infrastructure expenditure and a lower tax regime. Rajesh Sud, the Executive Vice CMD of max Life Insurance also expressed a similar view and said that the government might announce simplified income tax laws in line, expected to make the laws more competitive with respect to global economies. Various insurance companies expressed different expectations of the Union Budget for 2017-18.
25th January 2017
HDFC Life sees a profit of 10% in April-December period
HDFC Life has reported a net profit of Rs.645 crore in the April-December period for the financial year of 2016-2017. This is a 10% increase from the previous year which saw a net profit of Rs.589 crore in the same time period. The company reported a growth of 20% in total premium which was assisted by a 9% growth in renewal business and a 38% increase in new businesses. HDFC life, known for its affordable life insurance plans, has registered a 17% growth in assets under management with a 62:38 debt to equity mix.
24th January 2017
New Panel Formed By IRDAI To Review Life Insurance Norms
Insurance Regulatory and Development Authority of India (IRDAI) recently announced the constitution of a committee that it has set up in order to review the regulations surrounding life insurance products. The panel will be chaired by Mr. Amitabh Chaudhry who is the CEO at HDFC Standard Life Insurance.
The primary agenda of the committee is to review the existing framework of norms for insurance product which are linked and also those which aren’t linked to IRDA, among other things. The committee is expected to hand in its report to IRDA on or before March 15, 2017. The committee consists of other distinguished members such as K S Gopalakrishnan, CEO, Aegon Religare Life Insurance, Sai Srinivas, Appointed Actuary, Bajaj Allianz Life Insurance and Sandeep Bakshi, CEO, ICICI Prudential Life.
19th January 2017
2016-2017 sees 72 new life insurance products being introduced
The Insurance Regulatory and Development Authority of India (IRDAI) provided data which suggested that Life Insurance Corporation (LIC) surpassed private insurers with respect to the average number of new products that were offered whereas Unit Linked Insurance Plans (UNILPs) comprised of less than half the number of new products that were offered. According to the data produced by the IRDAI, LIC had developed four products out of which three of them were modified and offered from pre-existing products and only one was a new product. With the number of new life insurance policies being offered every year, the regulator had to curb insurers from filling up too many approvals as this would lead to a delay in these approvals being. The regulator also formulated a product planner rule to ensure that insurance companies wouldn’t seek the approval for more than five products a year. If the insurer surpasses this curb, IRDAI has said that the insurer would have to provide all the necessary data with respect to market research and product-wise arrangements.
17th January 2017
HDFC Ergo joins New India, United, in credit insurance
HDFC Ergo General Insurance, known for providing sort-after life insurance policies, announced today that the insurance company will be joining the incipient credit insurance segment which will offer complete cover to various corporate companies in the event of a possible default by their customers. HDFC Ergo joins companies like United, New India, Bajaj Allianz, ICICI Lombard and Iffco Tokio which offer similar products related to this subject. The Executive Director of HDFC Ergo, Mukesh Kumar, said that existing companies have been underwriting premiums to the tune of Rs.150-200 crore annually and that HDFC aims at selling around 100 policies spread over the next 18 months. HDFC Ergo will provide risk cover to exporters and their goods apart from offering cover to companies who are subjected to losses caused by customers who default on their policies.
17th January 2017
Future General India Life Insurance to offer group credit life insurance
Future General India Life Insurance announced that it will be collaborating with Vastu Housing Finance Corporation to provide a group credit life insurance called ‘Loan Suraksha Plan’. It is a plan that’s designed to cater to financial institutions to issue life coverage to new and existing borrowers. This will be a single premium plan which is said extend protection to the borrower to the amount of the home loan. The borrower will also have the option of extending his insurance coverage in case of additional loans and top-ups. Munish Sharda, Managing Director and Chief Officer of Future General India Life said that the company is looking forward in seeing their association with Vastu Housing Finance bloom and to offer their services through this new scheme.
12th January 2017
Fino Paytech sells 12% stake to ICICI PLF and ICICI Lombard
ICICI Lombard and ICICI Prudential Life Insurance have bought a 12% stake in Fino Paytech for Rs.150 crore. The company is now valued at Rs.1,200 crore. This deal will result in a twin effect with Fino Paytech working towards orders on foreign holding and to help the two insurers to easily sell their products to the people of remote villages. Fino Paytech recently sold a 21% stake to Bharat Petroleum for Rs.251 crore which has already employed its services at over 12,000 petrol pumps all across India. Fino Paytech has been awarded the payments bank licence after working as a business correspondent though Fino Paytech has been the only domestic remittance payments company.
12th January 2017
Tata Motors Set To Launch Virtual Reality Outlets In 2017
By mid-2017, Tata Motors is planning to open virtual reality outlets where customers can interact with the sales executive with ease, and enjoy shopping for a car in 5D. At least one executive will be appointed per showroom, to attend to the customers, and collect data. With the novelty of a virtual reality store, the company expects more customers to visit. Customers will get the opportunity to experience car shopping in 5D. This initiative also means lesser expense on real estate for the showrooms, especially in Delhi, Mumbai and other metro cities where obtaining a good real estate can be difficult.
4th January 2017
Online Insurance Purchase Gets a Boost with Digital Sops
The online insurance market does not even account for 1% of the gross premium amount of Rs.4.63 lakh accumulated by the insurance industry in the Financial Year 2016. But the government’s decision to incentivise online policy purchase from the public sector companies comes as a major boost for the future of this sector.
This decision comes amid a plethora of other announcements made by the Central government to push the country towards a cashless economy. The government-owned insurance companies would now offer a discount or credit of up to 10% of the premium amount in case of general insurance and 8% in case of new life insurance policies sold through customer portals, if the premium is paid via digital means.
According to IRDAI, purchase of online health insurance contributed to 2% of the total premium collected in health insurance sector in the Financial Year 2016. In the life insurance sector, online sales provided 0.52% of all the new premium collected.
Although government sector insurers like LIC lead the insurance sector, they lag behind their private peers when it comes to online sales. According to Alok Bhatnagar, the co-founder of EasyPolicy, currently the market share of public-sector firms for purely online purchase of policies is not more than 15%.
3rd January 2017
Rajan Wadhera to be President of Mahindra & Mahindra Automotive Division
On 31st March, 2017, the current President and Chief Executive of Mahindra & Mahindra Automotive, Pravin Shah will retire from his post. He is to be succeeded by Rajan Wadhera, who will be managing the buses, trucks, and the construction equipment business in addition to the automotive segment. Rajesh Jejurikar is chosen to be the President of M&M’s Farm Equipment department, while Ashok Sharma will become the President of the company’s agricultural division. All 3 men will report to Dr. Pawan Goenka, the MD of Mahindra & Mahindra Ltd. Post demonetisation, the company saw a decrease in sale of commercial vehicles, and passenger vehicles by 14.03% and 32.78%, respectively.
3rd January 2017
Tata AIA Bids To Take Over 70% Stake in PNB Metlife
Following a board meeting held on Oct 24, recently held, Tata Sons, in association with their partner, AIA Group, will be making non-binding bid to acquire a 70% stake in PNB Metlife.
The various stakeholders are MetLife International Holdings LLC which holds 26% stake, Elpro International which holds a 21% stake, M Pallonji & Company with 18% stake, Jammu & Kashmir Bank Limited owning 5% stake and the rest of the remaining stake of 30% is held by Punjab National Bank itself.
Following a successful buyout of PNB’s stake, Tata AIA plans to merge it with Tata AIA Life Insurance Company. Tata AIA Life Insurance Company Limited (Tata AIA Life) was formed following a partnership between Tata Sons Ltd. and AIA Group Ltd. (AIA). PNB MetLife enjoys a trusted presence across 150 Indian cities with 7000 locations since 2001 and has a wide spread customer base.
2nd January 2017
Life Insurance Profits Drop Despite 14% Growth in General Insurance
India remains to be ahead of the UK and the US with a premium growth rate of 7.9% as compared to the average of 2.5% recorded by advanced countries. However the real test lies in the emerging markets where India has lagged behind, showcasing average growth rate of 9.8%. Looking at Asia where the average is at 8.2%, India has fallen behind countries such as Singapore, Thailand and Malaysia.
After recording $71.78 billion in premium income in the year 2015-16, India has secured 1.5% of the global insurance market. This premium income can be largely split in two parts out of which $56.68 billion (78.96%) can be attributed to the life insurance industry and $15.10 billion (21.04%) to the general insurance industry.
In India, life insurance providers recorded a drop of 2.4% in profits which came down to Rs 7,414.97 crore. this is despite the 14% surge in profits recorded by the general insurance industry, whose profits touched Rs 96,379 crore. India’s 4 leading insurers witnessed a 41% growth and general insurers have also recorded a modest profit from their health insurance segments.
2nd January 2017
SIDBI partners with LIC to boost the venture capital ecosystem of India
To boost venture capital investments and to promote MSMEs in the country, Small Industries Development Bank of India (SIDBI) has partnered with the Life Insurance Corporation of India (LIC). SIDBI portfolio covers various funds under the Funds of Funds operations, and this includes India Aspiration Fund, Aspire Funds, and Funds of Funds for Startups. SIDBI had earlier signed a memorandum with insurer in April 2016 with an aim to increase the funds under India Aspiration Fund. SIDBI also constituted a committee with experts such as HK Mittal, Kiran Karnik, Sanjeev Bikhchandani, and some more prominent professionals to bring orderliness and to improve productivity.
11th January 2017
Amid increased e-wallets usage, insurance industry expands its portfolio
With online cyber thefts occurring more frequently than a common cold, cashless transactions provide an ample breeding ground for cybercrimes. Our government has been encouraging our country towards cashless transactions. But with the increase in use of e-wallets, general insurance agencies are looking at developing new insurance products to cover cashless transactions.
To ensure retention of customers, various mobile wallet companies like Freecharge and Paytm have started providing insurance to its customers to help drive customer perception of wallet safety while using their apps for online transactions. Such a move is bound to increase the frequency of mobile transfers and online banking.
5th January 2017
Mobile & e-wallets Will Enable Insurers To Initiate Digitization
The insurance sector in India is on the path of growth. Ever since privatization started, the size of the insurance industry has only grown by leaps and bounds. The sheer number of insurers in the private segment has increased 10 times. The penetration of life insurance alone rose to 2.6% in the year 2015 as opposed to 1.5% recorded in the year 2000. However, insurance continues to remain a product that requires selling and is still not seen as a necessity.
The most glaring example in this case is the Pradhan Mantri Jeevan Jyoti Bima Yojana, a government backed insurance scheme which was introduced back in the year 2015 and was supported by a number of leading banks in the country. Even though the rates of renewal for the scheme went up by nearly a whopping 90%, the percentage of new enrolments in the second year were few and far in between. Put together, a total of 3 crore people have taken the PMJJBY scheme. However, looking at the upside of things, due to the PMJJBY, the penetration of insurance has been considerably noteworthy. Taking the example of this, awareness around insurance needs to be built so that the actual potential of the insurance industry can be realized.
The year 2016 has provided the insurance industry with several historical developments such as the launch of the first IPO ever in the insurance segment and the merging of two major insurance companies.
5th January 2017
Online Sales Of Aegon Life Insurance Doubled Over The Past Year
Martjin de Jong, Chief Digital Officer of Aegon Life Insurance stated that Aegon’s life insurance online sales has increased two fold since last year. He stated that he expects this grow and that demonetisation will increase online sales of their insurance products. According to him, the other factors that will increase the digital sales of the company are young population, high growth in national income, and hunger for data. Aegon Life Insurance gets 35% of their sales from online portals. Whereas according to industry experts, only 2-3% of customers buy their policies online. Martjin stated that even if this percentage increases to 10%, insurance companies will grow vastly.
26th December 2016
MetLife Launches Virtual Reality Insurance Experience in India
MetLife Insurance firm and PNB MetLife has joined hands to launch a virtual reality customer service platform. This technology platform is called as “CobVRse”. Customers who are looking for customer service can experience a simulated 3D environment. This is the first virtual reality technology in the insurance industry in India. In these systems, insurance advisors will be portrayed as avatars named “Khushi”. Customers will be able to interact with these avatars. Currently, this system is implemented in 15 MetLife branches spread across 10 cities and towns in India. In the second phase, MetLife will introduce VR devices to their sales team.
26th December 2016
Demonetisation Effect On Life Insurance Policies
After demonetisation of Rs.500 and Rs.1000 currency notes was declared in India, people looked for ways to save their unaccounted money. Insurance companies were benefitted by this move as lot of them purchased life insurance policies. According to a report issued by the Insurance Regulatory and Development Authority of India, individual single premiums collected in the month of November after demonetisation was announced was Rs. 6,692 crore which is 507% more than the insurance premium collected in the month of November, 2015 of Rs.1,103 crore. On a monthly basis, life insurance segment grew by 170% from the previous month whereas the industry grew by only 28% on a month-on-month basis previously. Industry experts stated that demonetisation has impacted the life insurance sector positively as about Rs.12 trillion has come into the formal system.
23rd December 2016
Massive Rise In Insurance Claims Due to Cyclone Vardah
Cyclone Vardah was one of the severe natural calamities in India in the year 2016. The angry wind destroyed almost everything in the cyclone hit regions. As the cities and towns are recovering from the cyclone effect, numerous insurance claims have been made. Insurance companies are receiving high number of claims for huge amount. Insurance companies have stated that they will get claims worth Rs.350 crore due to Cyclone Vardha which struck Chennai coast on December 12. Most of the insurance claims are made by small scale businesses, warehouses, automobile sector, and godowns. J.S.Dhahiya, General Manager of United India Insurance Company stated that they have received more than 250 claims so far for a value of Rs.80 crore but they are expecting the value to go more than Rs.200 crore. The centre has decided to launch insurance cover for natural calamities going forward.
23rd December 2016
Max Life and HDFC Life respond to the IRDA concerns
In their response to the concerns raised by IRDA on the merger model, the companies, Max Group and HDFC Life have submitted the first set of arguments defending the merged life insurance businesses. It states that the companies have not altered the merger model and the newly formed division operates in accordance with Section 35 of the Insurance Act. The second argument put forward by the companies is that, Max Financial Services has its major form of business in life insurance segment under Max Life, hence IRDA should not consider Max Financial Services as a problem in this scheme of arrangement. The insurance regulator IRDA is in the process of examining the report submitted by the two firms.
22nd December 2016
Government Offers Discounts On Insurance Policies Bought Online
In an attempt to encourage people to go cashless, state-owned insurance company, Life Insurance Corporation are offering 8% to 10% discount on policies purchased online. The insurance companies are able to provide discounts as online sales reduces the servicing costs and the commission cost they pay to the intermediaries. Thus, the insurance companies share a part of their profit with the customer by reducing their premium. LIC has not launched any new policies after announcing about the online discount. Currently, LIC offers only two types of policies online, namely Term Policies and Immediate Annuity Plan. They offer Term Policies online to customers who ask for policy with a sum assured of above Rs. 25 lakh.
22nd December 2016
Bajaj Alliance introduces its new life insurance policy - e-touch
Combining both health insurance and term insurance in one policy, e-touch gives customers the benefit of having a term insurance as well as having accidental death/disability cover till the age of 75 - all in one plan. The plan has four variants: Shield - Life Benefit plus WOP Benefit, Shield Plus - Life Benefit plus ATPD Benefit plus WOP Benefit, Shield Super - Life Benefit plus ADB plus ATPD Benefit plus WOP Benefit and lastly Shield Supreme- Life Benefit plus ACI Benefit plus ATPD Benefit plus WOP Benefit. Vineet Patni, President and Chief Institutional Business Officer, Bajaj Allianz Life Insurance, says that he is pleased that Bajaj Alliance is the initiator for a plan such as this in the market.
21st December 2016
SBI Life’s performance supports its deal with KKR and Temasek Holdings
SBI gave a 3.9% stake in SBI Life to KKR and Temasek Holdings at Rs.460 a share, valuing the business at Rs.46,000 crores. Analysts are speculating on whether a value of Rs.46,000 crore for SBI Life that holds over 9% market share looks good. The answer will be found in its performance in the first half of 2016 to 2017. SBI Life showed a 77% growth in its new business premium to Rs.4,644 crores from 54%. Despite a rapid growth, it showed only a 6% rise in its net profit to Rs.428 crores for a 6-month period, ended in September.
The deal values the company at 3.5 times its embedded value of Rs.13,000 crores for 2016- 2017. This looks average in comparison to ICICI Prudential Life Insurance valued at 3.45, and HDFC-Max Life at 4.3. Given the growth rates, analysts at Nomura Securities, state that SBI Life’s cost ratios are the best in the industry, leading to superior margins, and improving operating expense ratios. SBI Life has favourable earnings metrics. Its persistency ratios for 13th and 61st months are 77.4% and 26.97%, respectively, and its renewal premium business showed 20% growth.
21st December 2016
Smart usage of money back plans can enhance returns
Money back plans are popular among customers because of the returns generated at regular intervals. Though the returns generated are low, according to experts, smart usage of money back plans can enhance returns. Money back plan is the only product which provides survival benefit, maturity benefit, and insurance cover. According to V Manickam, Life Insurance Council Secretary, the real value of money back policy comes to prominence when you realize that value of money decreases over time. This effect can reduce purchasing power. With their regular payments, money back plans can help get better returns when the funds are deployed now, instead of doing it after 10 to 20 years.
According to Anil Rego, Founder of Right Horizons, one of the smart uses of a money back policy is paying for the policy itself after sometime. He also added that loans can be a smart usage of these plans as it helps use an existing asset to get a better interest rate. Rishi Mathur, Head-Products, and Strategy, Canara HSBC Oriental Bank of Commerce Life Insurance, said that money back plans are ideal for short term financial requirements.
21st December 2016
Bajaj Allianz Life Insurance Kicks Off Jan Jagruti in West Bengal
India’s leading privately held life insurer, Bajaj Allianz Life Insurance recently launched a roadshow in West Bengal to increase awareness about insurance. Known as ‘Jan Jagruti’, the roadshow commenced on Dec 6 and will be conducted across 25 major towns and cities in the state. The Jan Jagruti drive is being conducted with the primary objective of raising awareness about the importance of car insurance and how it works to not only protect individuals but also their loved ones.
20th December 2016
LIC’s new premiums saw a 140% increase following demonetisation
After demonetisation of high value notes in November, data showed that LIC’s new premiums saw a 140% jump and collected Rs.12,528.07 crores as new premium on a year-on-year basis. Whereas, private life insurance companies saw a 50% growth in new business premiums for the month of November, and collected Rs.3,533.33 crores.
From April to November, life insurers collected Rs.1,03,404.60 crores as first year premiums, showing a growth of 39%. LIC saw a growth of 44%, while private insurers gained 26%. According to insurance executives, 50 to 55% of premium payments have moved to online payment, credit or debit card payment, and cheque.
19th December 2016
Aviva launches ‘Aviva Heart Care’ for couples
Aviva announced a new heart insurance plan on 7 December targeting couples, which is first of its kind in the whole country. The product named ‘Aviva Heart Care’ comes as a joint policy offering and it provides protection against 19 different heart conditions ranging from mild to moderate and extreme. Policyholders can restore the benefits anytime, if the entire sum offered under the plan is used up for treatments. Regardless of the nature of treatment, the policy also gives the option of lump-sum payout. According to the company statement, Aviva Heart Care allows one to cover themselves and their partner in the same policy at an easily affordable price.
16th December 2016
HDFC Life Enters Micro-insurance Segment
One of India’s leading life insurer, HDFC Life recently launched themselves in the micro-insurance space with two brand new products - Jeevan Suraksha and Credit Suraksha which will provide affordable financial security to customers.
On the occasion of the launch, Mr. Sujoy Manna, VP for HDFC Life (Products) said that that there is untapped potential in the micro-insurance space and HDFC will employ a multi-channel distribution network, while taking lessons from successes in the past to launch these new products for customers, while also increasing the penetration of micro-insurance. He also said that with this venture, HDFC will be able to tap into the financially under-insured
By partnering with micro finance institutions, the private insurer will tap the financially under insured segments throughout India and also co-operatives which are a major part of the unorganized sector.
15th December 2016
Insurances premiums and bonuses could be impacted all because of the falling interest rates
With interest rates moving south swiftly, possibly a result of demonetisation, it is most likely that bonuses on insurance plans could be lowered and premiums going north. Milliman says that lower yields on fixed-interest assets has made it challenging for insurance companies to meet the terms they have guaranteed. He added that lowering the bonuses offered in insurance plans and increasing the premiums could be their only way forward. S.P. Prabhu, head-debt funds, IDBI Federal Life Insurance says that this is definitely how they would choose to move forward, that said, the increase of premiums will be minimal and not dramatic.
14th December 2016
JetPrivilege Members To Be Insured By HDFC Life
JetPrivilege members will be covered under a unique one year life insurance policy in association with HDFC Life. The policy is available exclusively to JetPrivilege members, who can apply for the policy online.
The policy offers a number of benefits such as a choice of coverage (either Rs.50 lakh or Rs.75 lakh) at very affordable premiums. In addition, the policy will be provided without medical tests.
The term plan will cover policyholders for 365 days and the cover amount will be determined by the membership tier level as part of JetPrivilege loyalty program.
The partnership between HDFC Life and Jet Airways is the first of its kind for the airline, and it is confident that the life insurance plan will receive support from its loyalty membership customers.
5th December 2016
Edelweiss Tokio provides Rs.1 crore cover to Indian Paralympic medal winners
Edelweiss Tokio Insurance Company has provided a life insurance cover for every Indian paralympic medal winners from Rio 2016 Paralympics contingent.
These athletes include Mariyappan Thangavelu, Varun Singh Bhati, Deepa Malik, and Devendra Jhajharia. They were all facilitated at the “Edelweiss Titans” event, an awards and recognition program to facilitate over-achievers within the group.
The company had announced that it would be the first and only sponsor for India’s Paralympic team at Rio De Janeiro, Brazil.
Rashesh Shah, Chairman of Edelweiss Group, spoke on the occasion and spoke proudly about the medal-winning athletes and stressed on the fact that these athletes, despite facing numerous hurdles, went on to win a medal for the country.
The athletes too were happy with the recognition and were happy to be facilitated for their achievements in a land where cricket and bollywood are the only two things people seem to care about.
2nd December 2016
12% Increase in Products Offered by Life Insurance Companies
The life insurance sector at the end of October 2015 had a total of 610 products in its portfolio, and that number has risen to 685 in October 2016, marking a 12.3% increase in the number of products made available to customers. This information was released by the Life Insurance Council, which revealed that the number of products so far as the private sector was concerned was 579 last year, and has currently grown to 650 in 12 months’ time. India’s biggest insurer – Life Insurance Corporation of India also witnessed a rise in the products offered, jumping from 31 to 35 in the space of a year.
Between individual insurance products and insurance policies designed for groups, the former recorded a faster growth rate as the number of individual products rose from 451 to 518 between the October of 2015 and the October of 2016. A marginal increase was recorded with group products, as they rose from 159 to 167 in the space of a year.
1st December 2016
PCMC Enables School Students to Avail Insurance Cover
It is reported that more than 40,000 students will now be eligible for the scheme wherein parents will receive Rs.1 lac in case of the accidental death of their child on campus. Starting from Academic Year 2017-18, the PCMC (Pimpri-Chinchwad Municipal Corporation) will provide insurance cover to primary as well as secondary school students until they have completed their education. PCMC currently manages 136 schools that offer education to more than 40,000 students from classes I to VII. The PCMC budget has already made a provision of Rs.40 lacs for the same so that students can remain protected whilst their families also receive financial security in case of their untimely demise on campus.
1st December 2016
Total Insurance Premiums To Touch Rs 26 trillion by 2020, says CII-KPMG Report
According to a report put together by CII-KPMG, the total premium of the entire insurance sector, including life and non-life insurance, is predicted to touch a figure of Rs 26 trillion by the year 2020. The report was unveiled jointly by CII and KPMG also mentioned that India is yet to start on the path of distributing insurance products with the help of widespread use of digital channels, for which it is important for a considerable number of intermediaries to be a part of the insurance distribution process. Given the low rate of insurance penetration in India, the report also addressed the issue and has given some suggestions regarding the same. They have suggested that the insurance distribution channel strategy must be redesigned, in addition to creating financial awareness not only of the customers but also of the channel partners insurance landscape.
30th November 2016
Banks To Offer Pension Schemes & Insurance To Jan Dhan Account Holders
In an effort to encourage the transaction habit among Jan Dhan account holders and also make them aware of insurance services, the government plans to urge banks to pursue Pradhan Mantri Jan Dhan Yojana accounts which have seen an increase in deposits and offer financial products & services such as pension schemes and insurance. This move, which has been planned with the objective of providing Jan Dhan account holders with basic financial cover, comes in after the recent government led demonetization drive which has ceased the legal tender of after Rs 500 and Rs 1,000 notes.
30th November 2016
Premium payment due date for life insurance extended by 30 days
With the recent withdrawal of Rs.500 and Rs.1000 notes, the government has also specified limits on the amount that one can withdraw from banks. As the public faces a cash crunch from these restrictions, the IRDAI has extended the window for premium payment of life insurance policies by 30 days. This provision is for policies that fall due between 8th November and 31st December, 2016.
All life insurance companies have been requested by the IRDAI to comply to this notice. The move was initiated following RBI’s extension of due date for the repayment of various loans that amounted to Rs.1 crore.
29th November 2016
Now you can buy over-the-counter life insurance from a PoS person
If you are a first-time insurance buyer looking for a simple product, you can now purchase it from a PoS (Point of Sales) person. You will be assured of a quick and easy sales process as the products sold will not be difficult to understand. For the purchase of complex insurance products such as ULIPs and deferred annuity plans, customers will have to go through the traditional route of approaching the agents.
As per the guidelines released by the IRDAI, a PoS product will be simple to understand with all its advantages predefined and disclosed upfront. Some of the products that will be sold through this channel include term insurance with or without the return of premium, immediate annuity products, and non participating non linked endowment products. The PoS person will be employed by the insurer or an intermediate entity such as a broker.
The aim of this initiative is to improve the penetration of insurance in smaller towns.
25th November 2016
30% Growth Reported From First Year Life Insurance Premium Income
Life insurance companies have reported that their earnings from first-year premiums have increased by 30%. The data, released by the IRDAI, shows that life insurance companies amassed a total of Rs.87,344 crore for the period April 1st- October 31st 2016 through first year premium collection.
The premium collection for the previous year for the same period was Rs.66,997 crore, making the increase around 30%.
The largest contributor to this has been single-premium and group insurance policies. It was seen that regular premium policies, which comprise the chunk of a life insurer’s long term profitability, rose by about 14.4% year-on-year.
24th November 2016
Following Demonetization, Insurers Request IRDAI To Grace Period For Policy Renewal Till Dec 30, 2016
Reeling under the impact of the demonetization of high-denomination notes which has caused nation-wide inconvenience, life insurance providers have requested IRDAI to extend the grace period applicable for renewal of policies.
Life Insurance Corporation of India (LIC), the state-owned insurance provider has revised its grace period which will not extended for an additional 22 days. The insurer has also waived penal charges applicable on delayed payments, along with scrapping medical examinations. This means that policyholders who have premium payments due in the grace period between November 9 and 30 will be allowed to make payments before the end of the month without having to give any penal interest. Policy holders will not require to submit a declaration of good health for this period if they have delayed in making their renewal premium payment.
Insurers across India have asked the IRDAI to extend the grace period for policy renewal in order to provide some relief to policyholders who are due to make payments on their policies despite a serious cash crunch and widespread unavailability of the new high-denomination notes at post-offices, banks and ATMs.
Normally, the grace period provided under life insurance policies for payment of premium is between 15 to 30 days, depending on the frequency of payments - quarterly, half-yearly or yearly.
23rd November 2016
HDFC Standard Life and Max Financial Services to take up concerns over merger with IRDA
HDFC Standard Life and Max Financial Services will be submitting their justification to the IRDA regarding the concerns they had raised over the merger of the two companies. The main concern was that the model for merger was not in alliance with Section 35 of the India Insurance Act. The transfer of liability from Max Financial Services into the merged company was also cited as an issue by the IRDA.
After the merger, a listed insurance company was proposed to be created. Following this, the plan was to demerge the insurance business and then merge that part with HDFC Standard Life Insurance Company. The listed company minus the insurance vertical was to be combined with Max India.
The meeting with IRDA was planned primarily to identify the changes that should be incorporated into the merger to receive an approval.
22nd November 2016
SBI Life Insurance observes 5% hike in net profit
SBI Life Insurance has announced that they have seen a 5% growth in their net profits in the first half of this financial year. The current figures stand at Rs.428.17 crore, while it was reported to be Rs.407.98 crore during the same period last year. The new business premium of the company also rose by 77% to stand at Rs.4,644 crore during the April-September period. Additionally, the renewal premium rose by 26% to touch Rs.3,715 crore during H1.
The company’s operating expenses to GWP went down by 16% during the first half of this financial year. The AUM also rose to Rs.87,784 crore during this period, as opposed to Rs.74,554 crore during the same time last year.
21st November 2016
Growth in Profit After Tax for SBI Life Insurance
According to recent report, the Profit After Tax (PAT) for SBI life insurance has increased by 4.94%. The current PAT is Rs.428.17 crore. SBI Life’s Asset Under Management also increased from Rs.74,554 crore to Rs.87,784 crore. The same trend can be observed in new business premium which increased from Rs.2,626 crore to Rs.4,644 crore. There has been a growth of 26% in the collection of renewal premiums. According to Arijit Basu(CEO), improved performance by the distribution channels have led to this growth. There has also been a growth of 54% in the Individual New Business Premium.
18th November 2016
Max Life Insurance Launches InstaClaim
In an effort to make the claim approval process easier, Max Life Insurance has introduced a new service called as ‘InstaClaim’. With the help of this service, eligible customers can get their claims approved within one day. According to Rajesh Sud (Managing Director, Max Life Insurance), this initiative was taken to make the claim approval process faster, transparent and smooth. However, this service will be applicable for only those cases where the claim amount is less than Rs.25 lakh. It is mandatory to submit the required documents by 3 pm on any of the working days.
18th November 2016
SBI Life Insurance to host its IPO within 2 years
SBI Life Insurance, subsidiary and the insurance arm of the State Bank of India group, reportedly plan for an IPO in the coming 18 to 24 months.
Although, the talk has been happening for the last year or so, a concrete decision has only been arrived upon now. To make this happen, SBI is expected to complete divesting 5% of its Life Insurance business by January 2017.
This life insurance company is basically a partnership between SBI and BNP Paribas Cardif. By deciding on the IPO, SBI Life will join ICICI Prudential as the second insurance company to take the IPO route to raise money. Reportedly, ICICI raised over Rs.6000 crore with their IPO.
The move has been decided upon in order to bring in more public investors into the fray.
17th November 2016
HDFC and Max Life Insurance company merger halted comes to a halt
In one of the biggest news related to the insurance industry, a suspected merger between HDFC Life and Max Life Insurance Company Limited (MLIC) has come to a sudden halt.
This happened because IRDA, the insurance regulatory authority of India posed a few reservations pertaining to the merger.
The two companies, however, have said that they will address the issue and clarify the matter with the regulator. Both HDFC Life and MLIC on September 21 to get an in-principle agreement from IRDA. But the regulator said that the deal cannot happen in the current form.
Main reason for the halt is that Max India was looking to merge Max Life Insurance with Max Financial Services and then the demerge the insurance division to transfer to HDFC Life.
No IRDA officials were available for comment on this issue.
17th November 2016
SBI Looking to Sell Percentage in Life Insurance Arm
The State Bank of India (SBI) is looking at selling a 5% stake in its life insurance arm, sources have said. The bank is approaching sovereign wealth funds and investors with the aim of selling up to 5% of SBI Life to gain capital before their scheduled IPO.
SBI Life plans to be a listed company by the next year, which many believe is the reason for the disinvestment. The bank, however, has denied any IPO in the near future. The bank has stated that there is interest from Middle East funds as well as sovereign wealth funds like GIC.
The deal would enable SBI to raise close to Rs.2,000 crore through the 5% disinvestment at its current valuation of Rs.40,000 crore.
14th November 2016
Canara HSBC Oriental Bank of Commerce Insurance Company launches new ULIP
The newest insurance company in the block, Canara HSBC Oriental Bank of Commerce Life Insurance has launched a unit-linked insurance plan specifically for High Networth Individuals (HNI). This plan, as the CEO said, is called the Platinum Plus Plan and has been introduced to fulfil customers’’ dual goal of security and investment at the same time.
Anuj Mathur, the CEO, continued that this plan helps the company cater to a diverse range of people with varying payscales, risk, and needs. He also suggested that the company will work towards coming up with more such products which take care of a customer's’ multiple needs through a single investment. The plan will provide a favourable investment performance with the help of lower charges, wealth boosters, and loyalty additions.
9th November 2016
SBI Life Insurance offers support to Red Cross Blood Bank
In recent reports circling around Bhubaneswar it is being said that SBI Life Insurance has officially extended a lending hand towards Red Cross Blood Bank. As part of the firm’s CSR program, SBI Life has provided an ambulance to help the reach more people and also to ease the transportation woes. Executive Director of SBI Life Insurance, Mr. M Anand was present at the occasion where he presented the keys of the ambulance to Dr. Sanjay Ray, Chief Medical Officer of the blood bank.
Speaking after the ceremony, Mr. Anand said that Red Cross lacks modern amenities which enable them to reach more people and that an ambulance was one of them. He also said that he hopes the blood bank reaches larger masses and assist them with their medical issues.
8th November 2016
Rise in Bajaj Finserv’s Earnings
Due to great performance of the general insurance business, the profits for Bajaj Finserv has increased by 30.5%. There has also been a rise of 42% in gross written premium. The current value for gross written premium is Rs.2,179 crore. However in the case of Bajaj Allianz Life Insurance, there has been a drop in its net profit. The consumer business have increased by 30%. There has also been some talks of Allianz separating from the Bajaj Group. Both the companies have not yet confirmed this news.
3rd November 2016
September sees an 86% hike in non-life insurance premiums
Non-life insurance providers have witnessed an 86.2% rise in their gross premiums for the month of September, this financial year. The hike has propelled the overall premium value to Rs. 14,950 crore. The premium collected for the same month during the last financial year was Rs. 8,029.62. As per IRDAI data, public insurance companies are seen to have taken Rs. 9,164.10 crore whereas private insurers garnered the remaining Rs 5,785.90 crore.
Among the public non-life insurers, the premium of United India Insurance grew by 105.3% to stand at Rs. 1,796.72 crore, whereas that of Oriental Insurance rose by 78.5%. National Insurance Company saw a premium growth of 8.4% and the premium of New India Insurance grew by 27.6%.
Among the private players, HDFC Ergo’s premium jumped more than 3 times to stand at 976.37 crore. ICICI Lombard saw a premium growth of 58.3% and the premium of Bajaj Allianz rose by 62.2%. Figures for Tata-AIG increased by more than two times to reach Rs. 494.19 crore.
ECGC and AIC, the specialised PSU non-life insurers garnered Rs. 3,537.40 crore as premium during September 2016.
2nd November 2016
Sundaram Finance announces merger of SIBS and LGFS
Sundaram Finance Ltd. have decided to merge its fully-owned insurance subsidiary Sundaram Insurance Broking Services Ltd. (SIBS) with its other subsidiary LGF Services Ltd. T.T. Srinivasaraghavan, Managing Director of SFL mentioned that SIBS has been dormant for a while, and it was hence amalgamated with LGFS.
LGFS is involved in the marketing and distribution activities of financial savings, insurance, investment and loan products. SIBS is engaged in financial intermediation, except in the areas of pension and insurance.
2nd November 2016
PFI raises its stake in DPLI to 49%
Prudential Financial Inc. declared that it has raised stakes in DHFL Pramerica Life Insurance Company (DPLI) from 26% to 49%. However, they have not disclosed the deal amount.
As per the agreement, PIIH which is a subsidiary of PFI has increased the stake to reach the maximum authorised cap of 49%. Through this move, PFI attempts to extend its life insurance partnership with DPLI.
Jan van den Berg, regional president of PFI, mentioned that DPLI has been instrumental in offering protection to families who are covered by life insurance in India. He also stated that PFI is looking for continued growth in the domain, and would be dedicated to the development of the collective venture.
27th October 2016
New Disclosure Norms for the Listed Insurance Companies
After consultation with Insurance Regulatory and Development Authority of India(IRDAI), market regulator Sebi has come out with certain disclosure norms for the listed insurance companies. According to Sebi, all the listed insurance companies will have to follow the same format as given by IRDAI while submitting the disclosures. For newspaper publishing purpose, the company will have to follow the format which is given by Sebi.
26th October 2016
Gartner Advises Insurance Firms to Investigate Insurtechs
According to Gartner, the insurance firms should increase their market insight on insurtechs to complement their digital strategies. Juergen Weiss said that insurtechs will play a huge role in accelerating innovation in the industries. Keeping this reason in mind, Weiss has advised the CIOs to examine different areas which are at par with the focus areas of insurtechs. They can also come up with different investments. Recent data reveals that around 60% of insurtechs have been launched in the last 3 years. However, the CIOs are still lagging behind as far as their digital strategies are concerned. Therefore, the insurers should come forward and grab the opportunities provided by insurtechs through Partner, Purchase, Invest or Acquire etc.
26th October 2016
Max Life Insurance Predicts a Market Growth of 10-15 %
Max life insurance predicts a market growth of 10 to 15 percent in the next two years. According to Mihir Vohra, the Director and Chief Investment Officer of Max Life insurance, global market trends are expected to leave an impact on the domestic figures for sure. He further added that the Federal Reserve’s decision to increase rates in December is likely to cause instability, yet the market has always provided more than the economy. Vohra asserts that the GDP growth rate of the country will also be determined by contributions from private sector. Speaking on the current market situation, he said that the local market is far more stable than the global market.
24th October 2016
Bajaj Allianz gives an opportunity to customers of lapsed policies
The private general insurance company Bajaj Allianz on Wednesday announced that they are providing customers an opportunity to revive their lapsed policies. Policy holders of lapsed accounts can apply between 14 October and 30 November to avail this benefit. It is applicable only to life insurance policies. The company also assures the continuation of life cover, bonus and tax benefits after renewal of policies. A similar move by Bajaj Allianz in 2015 had generated revenue worth Rs 95 crore from the revived policy premiums. The first-year premium of the company in Sep 2016 was reported to be Rs 442.70 crores.
24th October 2016
Bajaj Life and Reliance Life key winner and loser in the first half
The latest reports hitting the news suggest that insurance industry as a whole has seen immense growth over the first half of the 2016-17 financial year.
In fact, the industry has grown by over 20% courtesy of healthy contributions by both private entities and the entities.
Among the biggest winners and losers, we have Bajaj Life which grew by a massive 83% during the first half. This the firm achieved by focussing more on ULIPs by enabling rejig of its agency channels.
Other winners include India First Life (79%), Exide Life, and TATA AIA, which all charted some positive numbers.
Reliance Life, however, was the biggest loser in this segment as individual APEs went down by over 33% due to its shift from ULIPs to traditional policies. The firm, though, is positive that it will register positive year-on-year growth in the second half when the base effect comes into play.
The latest trend also suggests that people are gravitating more towards mutual fund and ULIP offering and that they are ready to take the necessary risk to see profitable returns.
21st October 2016
Edelweiss Tokio Life unveils a new online insurance plan
Edelweiss Tokio Life Insurance introduced a comprehensive online insurance plan which provides life cover and an option to take care of critical illnesses.
Speaking at the release of the product titled ‘Total Secure+’, the company’s representative said that this policy will continue to offer the death benefit. However, the sum a beneficiary receives would be a reduced amount as the policy includes the sum assured already paid.
This policy, which is a non-linked and non-participating plan, comes with three different options like Life Cover, Life Cover with Basic Health including seven critical illnesses, and life protection with comprehensive health cover, which comprises of over 35 ailments.
Edelweiss Tokio is a joint venture between Edelweiss, a diversified Indian financial conglomerate and Tokio Marine, one of the pioneers of Japanese insurance industry. The company was founded in 2011 and has Mr. Deepak Mittal as its chief executive.
20th October 2016
Good news for Life Insurance industry as growth hits a new high
Life Insurance industry in the country continued to post some impressive growth number during the second quarter of FY 2016-17 which ended in September.
According to a report, it is being said that private insurance companies in particular have witnessed a 30% year-on-year growth.
A report termed the Kotak Institutional Equities Research report, suggested that Life Insurance Corporation (LIC)’s growth was comparatively lower than private players, which stood at 29%.
Senior officials in the insurance industry are of the impression that most of the growth has been seen due to the rise in equity markets, which means a major contributor for growth are ULIPs.
The report also suggests that Bajaj Life seen the highest growth (80%) of all the private insurance providing firms in the country.
Overall, the life insurance industry charted a growth of 20% in Annual Premium Equivalent (APE) during the first half of the 2016-17 financial year.
20th October 2016
61 Percent Rise in the New Business Premiums of Life Insurers
Insurance Regulatory and Development Authority (IRDA) has observed a 61 % rise in the new business premiums of Life insurance companies from Sep 2015 to Sep 2016. The present value of total sales of LIC peaked up by 65.3 % when compared to the sales figures of the previous year. The remaining 23 insurers in the country have amassed Rs 5, 649.92 crores, which makes a 23 % rise from the last year’s sales. SBI Life’s new business premium doubled from 2015 while HDFC Standard crossed Rs 897 crores by this year. But the new business premiums of ICICI Prudential Life witnessed a negative trend.
19th October 2016
Bajaj Allianz to come up with an Insurance Cover for Social Media Activities
In a move to further modernize and enhance the scope of insurance policies, Bajaj Allianz has devised a scheme that will take care of the consequences arising out of the social media activities of individuals. According to the Managing Director of Bajaj Allianz Tapan Singhal, the insurance product will compensate for any of the third party damages arising out an individual’s actions on the web. The idea behind this concept is to insure a person’s social media activities much like the the cyber insurance cover for corporates. The policy will be designed to cover cyber theft, hacking, phishing and the like.
18th October 2016
Centre to soon amend the Employees State Insurance Act
Employees in the formal sector will soon be able to select health insurance policies from a wide range of products available in the market. Currently under the Employees State Insurance Corp (ESIC) scheme, it is compulsory for all individuals earning above Rs 21,000 to have a health insurance cover. According to sources, the Labour Ministry is expected to come up with a bill for amendment of Employees State Insurance Act 1948. Earlier this year, the finance minister had also proposed an option that allows employees to choose from different health insurance products recognized by the IRDA. The Labour Ministry will recommend Union Cabinet to approve this bill in the next Parliament session to be held in November.
18th October 2016
Bank of Maharashtra Has Renewed Its Tie-up With United India Insurance
The state-run Bank of Maharashtra (BoM) recently announced that it has renewed its tie-up with United India Insurance Company (UIIC). The corporate agency tie-up between the two companies will now enable customers to purchase any product from the suite of products offered by United India Assurance, at any of 1,896 Bank of Maharashtra branches across India. Customers will be able to buy a variety of insurance products like travel, personal accident, fire, motor, health and marine insurance from any of BoM branches.
17th October 2016
Government Urges LIC To Support Startups with Finances
The government of India has urged Life Insurance Corporation of India to offer financial support to startups. In addition to investment from pension funds and insurance companies, the government also hopes to see corporate India taking on social responsibility and helping out startup incubators and startups. The secretary of the Department of Industrial Policy and Promotion, Ramesh Abhishek, recently revealed that the money must be leveraged for startups and that state-run LIC manages over Rs.15 lac crore of assets that can be used to support the startup industry and help it find its feet among the bigger players.
17th October 2016
Provident Fund Subscribers Covered under Life Insurance Up To Rs 6 lakh
Starting Oct 1, all individuals buying new insurance policies will mandatorily be required to open an e-insurance account. For new insurers, the insurer will help facilitate the process, but existing policyholders shall have to get the account opened themselves.
This regulation has been implemented for providing added convenience to the policyholder. Once the policyholder has fulfilled the KYC requirements individuals can safely store varied insurance policies under one account, retrieving which can become easy and convenient at the time of filing claim. Mr. S V Ramanan, CEO, CAMS Insurance Repositories Services said that over Rs 5,000 crore of maturity claims are simply lying with insurers across the sector due to policyholders having misplaced their policies, which must compulsorily be presented at the time of making a claim.
The e-insurance arrangement shall also prove to be of great help to safeguard documents during natural disasters, given that applying and obtaining duplicate copies of insurance policy documents can be a task. Also, since duplicating an e-policy is not easy, this will also help keep in check cases of policy related fraud. Not only can policyholders view their policy details on the e-insurance account but will also be able to do much more like view scanned images of proposal forms and terms & conditions of the policy,
The opening and maintaining of an e-insurance account is completely free of charge for policyholders. This arrangement in turn will allow insurance companies to save on costs of printing and mailing physical insurance documents.
In order to open an e-insurance account, policy holders must submit an identity proof (PAN or Aadhaar Card), an address proof, their email ID, and their cellphone number.
13th October 2016
P2P Lenders To Offer Insurance Cover To Borrowers
Peer-to-peer lending platforms like i-lend, MicroGraam, LenDenClub and many others have tied up or are considering to tie-up with insurance providers to provide borrowers with cover against unexpected events like an accident or death, which can disrupt loan repayments. [email protected] lenders are joining hands with insurers like ICICI Prudential Life Insurance and HDFC Life Insurance to offer these benefits. Currently, the platform consists of about 14,000 borrowers and has disbursed loan claims worth Rs 22 crore till date.
13th October 2016
SBI To Sell 5% Stake in Life Insurance Arm
SBI (State Bank of India) may be selling a 5% stake in SBI Life Insurance to private equity funds.
SBI Life Insurance is a joint venture between SBI and BNP Paribas Cardiff, with SBI holding a 74% stake in the company.
Sources claim the sales are already being negotiated, with the sale projected to net the bank close to Rs.1,950 crore.
The bank is seeking a valuation almost three times the embedded value of Rs.13,000 crore.
It is estimated that the sale will take place during the third quarter, but details are still sketchy.
The reason for the sale is purported to be on account of the life insurer planning to go public. In light of this, it would be similar to the recent ICICI Prudential share sale to private investors before the insurer went public.
12th October 2016
Exide Life Insurance Launches New Heart And Cancer Plan
Exide Life Insurance has launched a new policy that offers benefits for heart conditions and cancer.
Called the ‘Exide Life Sanjeevani’, the plan provides a fixed lump sum benefit upon a cancer or heart-related conditions. The plan also waives off future premiums upon diagnosis and allows for the claiming of existing health insurance.
This is in addition to the plan providing double claims as well as tax benefits.
The plan would enable policyholders who have been diagnosed with heart or cancer-related illnesses to meet the financial costs of their illness.
12th October 2016
IndiaFirst Life Insurance Records Over Rs 10,000 Crore As AUM
IndiaFirst Life Insurance, a partnership between Andhra Bank, Bank of Baroda and Legal & General (UK), recently hit another milestone after having crossed Asset Under Management (AUM) of Rs10,000 crore, putting their current AUM at Rs. 9061 crores. The insurer recorded a year-on-year growth of 43%, having accumulated over Rs1000 crore towards gross collected premium.
7th October 2016
Aegon Life Insurance Revamps The ‘iTerm’ Online Protection Plan
Aegon Life Insurance, the forerunners of the online insurance movement have announced the re-launch of their flagship ‘iTerm’ Insurance policy which will now come with advanced features. This comprehensive online protection plan is one of the most affordable plans offered by the insurer which is available at very low premiums, possibly the lowest in the industry. Some of the new features to be included in the plan going forward include additional Life Stage benefit where protection cover can be increased, provision to make monthly, semi-annual and yearly premium payments and increased policy term of 62 years.
7th October 2016
Government Advises Farmers To Pay Premium For Crop Insurance Scheme
The government has urged farmers in the district of Virudhunagar to pay premiums for crop insurance under the Prime Minister’s Crop Insurance Scheme. Implemented since July 21, the crop insurance scheme has been undertaken by New India Insurance. Mr. A. Sivagnanam, Collector has said that farmers who have taken a crop loan, the premiums will be deducted by the respective bank and paid to the insurance company.
6th October 2016
Online Protection Policy Launched by Edelweiss Tokio Life Insurance
Edelweiss Tokio Life Insurance Company Limited launched an online plan called Edelweiss Tokio Life – Total Secure+, which offers complete life protection through a life cover in addition to a critical illness cover option. Since the critical illness benefit works as an accelerated benefit instead of as an additional benefit, the policy shall continue with the death benefit. However, it will be reduced to the extent of the critical illness sum assured already paid.
Total Secure+ from Edelweiss Tokio Life Insurance Company Limited is a non-linked, non-participating term insurance policy that can be availed in three variants: Life Cover, Life Cover with Comprehensive Health Cover covering 35 Critical Illnesses, and Life Cover with Basic Health Cover covering 7 Critical Illnesses.
4th October 2016
Bank Of India Sells 18% Stake In Star Union Dai-Ichi Life Insurance
Bank of India recently announced having sold 18% of its stake in Star Union Dai-ichi Life Insurance Company Ltd (SUD) to Dai-ichi Life Insurance Company Limited (DILIC). Following this transaction, Bank of India’s shareholding will drop from 48% to 30%, while DILIC’s shareholding will rise to 44% from 26%. Union Bank of India’s shareholding will continue to remain at 26%.
30th September 2016
Composite Merger Plan of Max India Receives Green Signal from Shareholders
Max India Ltd has announced the expansion of its operations by merging Max financial services with their insurance segment Max Life Insurance Company and HDFC Ltd. The business conglomerate has transferred insurance business from MergeCo (the combined fraction of Max Financial Services and Max Life Insurance) and the same is absorbed by HDFC Standard Life Insurance Company.
This decision was given a go-ahead by the board members after majority of its shareholders voted in favor of the merger scheme. HDFC Ltd earlier in August had approved the merger with Max India, and the merged entity was mutually agreed to function with the same name, HDFC Life.
30th September 2016
E-insurance Accounts Compulsory For New Policy Buyers
All individuals employed in the organized sector have a portion of their monthly income directed towards their Employees’ Provident Fund (EPF) account each month. This deduction from the monthly earnings is eligible for tax deduction and also accumulates interest. While the EPF deduction is common knowledge, what many employees may not be aware of is that their monthly EPF contribution also entitles them to a life insurance cover. Known as the Employee Deposit Linked Insurance (EDLI), this insurance cover is provided to PF subscribers and is provided to their nominated heir in the unfortunate event of their demise.
The EDLI scheme covers all individuals who are PF subscribers and are a part of the organized sector. With the amount of life cover recently hiked, PF subscribers are now insured under a life cover of up to Rs 6 lakh which can be claimed by their nominee or legal heir following their death. In addition to this amount, the nominee can also make a claim of Rs 1.5 lakh or 50% of the balance in the deceased individual’s EPF account, whichever amount is lesser, as bonus. The life cover (caped at Rs 6 lakh) and bonus will be applicable regardless of the employee’s age.
28th September 2016
Ticket Sizes See 20% Increase for Life Insurance
The life insurance sector has seen an almost 20% jump in ticket sizes for life insurance policies over the past 3 years, with the average ticket size going up to Rs.40,000.
The higher Sum Assured rates have led to higher premiums, resulting in the rise in ticket prices.
The type of plans also play a role in the increasing ticket prices, with ULIPs generally attracting higher ticket prices due to their higher returns.
Additional riders and add-ons to basic policies are also the norm now, leading to an increase in the Sum Assured.
This increase has been seen in offline as well as online plans, with the higher ticket price due to the desire for enhanced protection for online plans. For offline plans, need-based sales increases resulted in premiums and thus ticket sales increasing.
This trend has been in sharp contrast to the earlier slashing of online insurance plans, where premiums dropped to as low as Rs.7000 annually. However, the online sector has staged a recovery and premiums are now at par with offline plans.
26th September 2016
E-Insurance To Increase Insurance Process Efficiency
With the IRDAI making issuance of e-insurance policies mandatory from October 1st, 2016, there will be a marked shift in the way insurers process policies. Motor and travel insurance policies will have to be issued electronically from October.
At present, customers can choose whether they wish to have their policies in electronic or hard copy, so the process is not completely digital.
However, the benefits offered by e-insurance are fast catching the eye of customers, as these policies offer easier storage and a hassle-free experience. The claims process will also be linked, making it more convenient for customers.
Since operating costs will be reduced, customers will benefit from lower premiums.
However, the industry still has a long way to go as far as preparedness is concerned, with many still in the process of linking their insurance repositories in order to issue e-policies.
With only motor and travel insurance policies to be issued digitally, the vast customer base of life insurance and health insurance still remain.
26th September 2016
Life Insurers Seek ‘Merit Rate’ Under GST Regime
The Life Insurers Council held a meeting to discuss the possible implications of the Goods and Services Tax (GST) on the sector.
The Council decided to urge the government to implement a ‘merit rate’ instead of the prevailing standard rate.
The Council took this resolution to offset the possibility of an increase in insurance rates due to the GST being fixed at 18%.
The initial demand was for a zero percent tax for life insurance, but this has been revised to a merit rate, with the life insurance industry submitting their suggestions to the Finance Ministry by the end of September.
The sector fears that if the standard rate is levied, insurance will become more expensive which will serve as deterrent to more individuals from buying policies, especially among vulnerable sectors that would benefit the most from coverage.
22nd September 2016
‘Smart Junior Plan’ New Addition to Canara HSBC Life Insurance Portfolio
Canara HSBC Oriental Bank of Commerce Life Insurance have introduced the ‘Smart Junior Plan’, a new children’s insurance policy to meet the education needs and safeguard the child’s future in the event of the insured’s (parent’s) untimely death.
The plan provides a guaranteed 20% of the Sum Assured each year for the last 5 years of the policy term, which can be used towards funding the child’s education.
The policy also offers policyholders the chance to customize the policy term based on individual savings and education plans.
Flexible premium payment options and tax benefits add to the overall benefits associated with this plan.
In the event of the life insured’s untimely death, the nominee stands to receive a lump sum payment and waiver of premium payment till the policy matures.
21st September 2016
IRDAI To Issue Life Insurance Point of Sale Regulations
The Insurance Regulatory and Development Authority of India (IRDAI) will be announcing norms to govern Point of Sale (PoS) transactions for life insurance. The move is touted to increase growth in the sector and improve insurance penetration.
IRDAI had announced norms governing PoS transactions in October 2015 for both life and non-life insurers. As per the guidelines, PoS providers are permitted to sell insurance products that don’t require underwriting in the health and non-life sectors.
As per the new norms, PoS distributors will be able to sell certain life insurance products as well.
The proposal has met with enthusiasm by the life insurance industry. This move will help simplify the insurance distribution network and ensure better reach.
21st September 2016
IRDAI Considers Two Factor Authorisation for e-Insurance
The Insurance Regulatory and Development Authority of India (IRDAI) is considering two factor authorisation for e-insurance products in an effort to increase security.
At present, motor and personal accident policies can be purchased through single factor authentication.
As part of the two factor authorisation, IRDAI has advised insurers to issue One Time Passwords (OTPs) to individuals buying policies in addition to digital and electronic signatures. To facilitate this, IRDAI will be amending the existing regulations concerning e-insurance.
This step will help prevent insurance fraud and make online insurance more credible, according to the insurance regulator.
Current regulations stipulate that e-insurance policies can be issued only after digital signature or Aadhaar verification, which is a cumbersome process. In order to do away with this, IRDAI has come up with the two factor authorisation system where the individual verifies the information through an OTP sent to his registered mobile number.
16th September 2016
IndiaFirst Life Records 28% Increase in Group Policies
IndiaFirst Life Insurance, the private insurance company, has recorded an impressive year-on-year growth of 28%, which is a whole 10% more than the industry average of 18%. The Life Insurance Council website posted its results for the second quarter of 2016, and the top players in the market include ICICI Prudential, Bajaj Allianz and Star Union Dai-Chi, who recorded a decline of 38%, 20% and 56% respectively. IndiaFirst, on the other hand, achieved a YTD growth of 46% year-on-year, with the total business adding up to Rs.94.7 crore as on the 31st of July, 2016.
14th September 2016
HDFC and Max Life Wait for CCI Approval
HDFC Standard Life Insurance and Max Life Insurance now await the approval of the CCI (Competition Commission of India) following their merger to become one of the biggest insurance amalgamations in the world. Max India revealed in a statement recently that it had filed a joint application, seeking approval from the CCI.
During a meeting that was conducted on the 8th of August, HDFC Standard Life Insurance Company’s board of directors, and representatives of Max Financial Services and Max India approved the entry into definitive agreements for the merger of business between the aforementioned entities via a composite Scheme of Arrangement.
The exchange ratio and relative valuation of Max Life and HDFC Life is expected to be 31% and 69% respectively.
14th September 2016
Insurance Portability To Become A Reality?
The chief of the IRDAI (Insurance Regulatory and Development Authority of India) hinted that insurance portability could be a possibility in the near future. While he stated that IRDAI has not initiated the move, he encouraged debate on the subject.
Currently, health insurance policies can be ported as standardization is required for portability to take place.
Insurance products currently have a number of clauses, making it difficult to set up a road map for portability. Digitization of policies would be an initial step, following which the prospect could be considered.
This move would benefit the insurance sector and enable it to grow. At present, estimates peg growth in the life insurance sector at around 15%, while the health insurance sector has seen close to 31% growth.
13th September 2016
Marathwada Workers To Receive LIC Cover
The Marathwada Labour Union has sought life insurance cover for its workers under the Central government’s Aam Aadmi Insurance Scheme. The scheme, which is being implemented by the government as well as the Life Insurance Corporation of India (LIC), is targeted at the working class, with premiums fixed at Rs.200 per person, to be paid by the state and central governments. Under this scheme, children of porters will receive a scholarship of Rs.100 per month, while nominees will receive Rs.30,000 in case of the insured’s natural death. In the event of the insured’ accidental death, the nominees would receive Rs.75,000.
Under the scheme, the porters will have to open bank accounts to avail the benefits of the insurance cover and scholarships for their children.
The Labour Union has also appealed to the authorities to increase the scholarship amount to Rs.1,000 per month.
8th September 2016
Move to Increase Insurance Cover in India: FM
At a function to felicitate the Life Insurance Corporation (LIC) on its 70th anniversary, the Finance Minister raised the need to bolster the country’s social security to enable the country to be an insured and pensioned society.
With the growth seen in different sectors of the economy, he expressed a hope that India would soon have a social security apparatus providing insurance and other benefits to all citizens.
At the function, he spoke of the need for low cost insurance options and the urgent need to extend such coverage to the agricultural sector as well as providing low cost medical insurance to all Indians.
The government is slowly taking steps towards realising this objective through a number of upcoming schemes and initiatives.
6th September 2016
Cancer Shield Plan Launched by Birla
Birla Sun Life Insurance has launched a cancer shield plan, aimed at providing financial assistance and support in the event the policyholder contracts cancer.
The rising incidence of cancer diagnosis in the Indian populace has prompted the life insurance company to introduce the product, which will provide protection and cover for both initial as well as later stages of the disease. The plan will provide the policyholder with a lump sum upon diagnosis towards meeting the cost of treatment and palliative care.
2nd September 2016
Max Life Launches New Education Plan
Max Life Future Genius Education Plan is a new insurance plan launched by Max Life Insurance to enable parents to save smartly for their child’s education. An education in today’s world can be an expensive affair and it’s best to think ahead. The plan is a comprehensive non-linked participating policy. The plan is designed to meet the educational needs of the child even in the event something unfortunate happens. The plan comes with flexibility that can be tailored to suit the needs of the parents and the child. Based on the child’s graduation, the policy term can be chosen between the ages of 13 years and 21 years. Tax benefits are applicable on the policy as per the prevailing tax laws. To be eligible for this plan, the buyer must be between the age of 21 and 45 years old. Rider policies are available to enhance the benefits of this plan.
1st September 2016
Increase in Insurance Cover for Serving Army Personnel
The insurance cover for officers of the APS (Army Postal Corps), Military Nursing Service officers as well as re-employed officers have been increased to Rs.75 lakh from Rs.60 lakh. There has been an increase in insurance cover from Rs.30 lakh to Rs.37.5 lakh for JCOs (Junior Commissioned Officers) and ORs (Other Ranks), including JCOs with honorary commission, APS and Defence Service Corps.
The AGIF (Army Group Insurance Fund) has also capped the disability benefit for officers at Rs.25 lakh and Rs.12.5 lakh for JCOs or ORs with completely disability. However, army personnel who have asked to leave the military service due to drug addiction, alcoholism, and diseases which were acquired before joining service, will be ineligible for any disability pension.
1st September 2016
30% Projected Growth for Canara HSBC OBC Life Insurance
The Canara HSBC Oriental Bank of Commerce Life Insurance is slated to grow at over 30% this year, according to estimates.
The increase in growth is due to the company focussing on online growth and their targeting of Tier II and Tier III city customers.
The growth percentage is even greater considering the overall sector posted growth of around 15% for the year 2015-16.
The company, which is a joint venture between HSBC Bank, Canara Bank and Oriental Bank of Commerce, has stated that it plans to target the technology rich Tier II and Tier III cities, where smartphone use is slated to reach over 770 million users.
The company is also hopeful that the changes being brought about in life insurance in terms of the introduction of regulations for e-insurance will lead to strong growth.
30th August 2016
PNB Metlife Launches New Online ULIP Plan
In a first of its kind for PNB Metlife, it has launched a new ULIP (Unit-Linked Insurance Plan) which can be purchased and managed online. Christened Metlife Mera Wealth Plan, this life insurance plan comes with multiple options to help insured members reap long-term monetary benefits along with protection for life.
This ULIP comes with multiple premium payment options and offers loyalty additions every year from the 6th policy year onwards. The loyalty bonus continues until the time of maturity. It also provides further flexibility for policyholders to choose from self-managed or systematic transfer on the basis of their personal investment goals and risk appetite. The Mera Wealth Plan helps customers in planning long-term investment goals such as education, housing, retirement, etc.
25th August 2016
Insurance to Become Innovation Hotbed With New E-Commerce Norms
The insurance sector in India is likely to see a boost in innovation in the sector, especially with the advent of e-commerce markets.
•Estimates project a 20% jump in sales through such platforms, hitting almost Rs.20,000 crore by 2020. The market has already seen exponential growth, from a mere $3.8 billion in 2009 to $38 billion (projected) by the end of 2016.
•Fuelling this surge in sales are life insurance products, which have received a new lease on life through online policy sales, which are priced lower than the traditional term insurance policies.
•An increase in travel insurance and motor insurance policies being purchased online has also contributed to the growth in the sector.
Digital platforms and mobile applications are seen as the future of the insurance sector, with IRDA recently releasing guidelines regarding sale of insurance products online. This will result in giving a boost to already soaring online insurance sales and also serving to regulate the market.
24th August 2016
Exide Life Partners with SVC Co-op Bank For Bancassurance Agreement
Exide Life Insurance recently tied-up SVC Co-operative Bank for a bancassurance agreement. As a part of the deal, Exide Life insurance will gain access to 193 branches of SVC bank, which serve over 8 lakh customers. In return, SVC Bank will benefit from the technology, product innovation, and best in class training which is offered by Exide Life Insurance.
Suhas N Sahakari, Managing Director of SVC Co-operative Bank said that life insurance is now considered not only as a form of protection but also as a form of investment. Speaking on the tie-up with Exide Life Insurance, he mentioned that the bank’s customers will definitely benefit from the added life insurance options which will now be available to them.
22nd August 2016
Bank Of India Aims To Up Targets By Rs 500 Cr From Asset Sale
In efforts to expand its capital base, the state-run Bank of India has managed to raise Rs 540 crore by monetizing its non-core assets. The company is planning to further raise a similar amount during the remainder of the year. Bank of India had previously raised Rs 540 crore in June by selling an 18% stake in a joint life insurance venture with Dai-ichi and Union Bank of India to the Japanese firm.
22nd August 2016
PM Farm Insurance faces skepticism in Bihar
Prime Minister Narendra Modi’s highly anticipated Farm Insurance Scheme has met a block in Bihar, where Nitish Kumar has pointed out numerous issues with it including the way it is named (‘Pradhan Mantri Fasal Bima Yojana’) and the real recipients. They claim that the scheme is intended to the benefits of the insurance firms rather than the agricultural workers. A chain of interactions between of Mr. Alok Kumar Mehta (Bihar Co-operative Minister) and Union Minister shows that they are unable to reach a decision. The PMFBY is introduced to offer life insurance for farmers at a lesser premium and to assist them to keep up farming even if the crop is damaged (due to natural or other related disasters).
19th August 2016
Life Insurance Sector Registers 23 % Growth In First 4 Months Of FY17
The life insurance sector has reportedly registered positive growth in first four months of FY17. The growth can be attributed to new business premium. Data released from the Life Insurance Council indicates that there was a rise of 22.66% in new business premium from life insurance in the first four months of FY17, as opposed to the corresponding time last year.
This growth was headed by LIC, which registered a rise of 24.15% in new business premium in the months of April-July. Private insurers, on the other hand, registered a growth of 18.69% from new business premium, which now stands at an estimated Rs 11,914.86 crore. this growth was majorly attributed to participation in the ULIPs or unit-linked insurance plans.
19th August 2016
ING to sell their South Korean life insurance arm
MBK Partners, a private equity company had attained a cent percent stake in ING’s life insurance arm for KRW1.84trn from the Dutch Insurance Group. The last day to sell the company has been postponed eliciting rumor that MBK might simply back out from the sale. Investment leader JD Capital (based in Hong Kong) and two Chinese companies, namely, Fosun International and Taiping Insurance Group are apparently contemplating purchasing ING to expend their reach to Korean financial market.
18th August 2016
INR 10 lacs insurance for sewerage labors proposed
The Hyderabad Metropolitan Water Supply and Sewerage Board (HMWS&SB) is planning to offer life insurance cover for INR 10 lacs in case something unfortunate happened resulting in grave injury or demise. This was announced by Mr. M Dana Kishore, the MD of HMWS&SB as the terrible losses of four workers in a manhole in Madhapur the previous week. They also held a sensitization training programme for the workers on precautions and correct use of equipment.
18th August 2016
CEO of Oriental Bank of Commerce Reveals that there are No Plans to Raise Stake or Sell
The CEO and Managing Director of Oriental Bank of Commerce, Animesh Chauhan, recently revealed that the bank has no intention of raising stake or selling its life insurance joint venture CHOICE (Canara HSBC Oriental Bank of Commerce Life Insurance Company). At the moment, Oriental Bank of Commerce holds a 23% stake in CHOICE. While HSBC holds 26% stake in the joint venture, Canara Bank has 51%. Chauhan stated that there is no question of altering or selling the company’s stake at the moment. He also revealed that the joint venture is performing quite well and is meeting the expectations set by the board.
17th August 2016
Net Profits for First Quarter Increases 6% for SBI Life Insurance
The first quarter of the financial year 2016-17 was a promising one for SBI Life Insurance as it recorded a growth of 52.73% in its gross total premium. Last week, the company reported that the net profit of the company grew by 6.43% to Rs.215 crore for the first quarter which ended on the 30th of June, 2016. SBI Life also released a statement according to which its net profit was Rs.202 crore during the first quarter of the previous financial year. The gross total premium of the company for the first quarter of FY 2016-17 increased by 52.73% to Rs.3,383, making it a significant rise in comparison with the Rs.2,215 recorded in the corresponding quarter of the previous financial year.
17th August 2016
New close ended scheme introduced by Birla Sun Life
Birla Sun Life Mutual Fund recently launched a close ended scheme designed to meet the requirements of certain investors. Titled “Birla Sun Life Fixed Term Plan-Series NR (1099 days)”, it is managed by Kaustubh Gupta, Sunaina da Cunha and Prasad Dhonde. The new fund offer was open from August 4th to 8th, with the scheme coming with nil entry and exit load. Investors can subscribe a minimum of Rs. 5,000, increasing their investment in multiples of Rs. 10. The scheme aims to offer returns through investments in fixed income securities which have a maturity date which coincides with the scheme duration. It will be benchmarked against the CRISIL Composite Bond Fund Index.
16th August 2016
Insurance policy launched by Corporation Bank
The CEO & MD of Corporation Bank, Mr. Jai Kumar Garg, unveiled their group credit life insurance scheme’ in partnership with LIC (Life Insurance Corp) in Mangalore on 4th August 2016. As per the bank’s official statement to the press, this scheme can be purchased by their term loan customers (aged between 18 and 60). The premium has to be paid only once. The loan can be covered under this scheme in the unfortunate event of loan applicant’s demise. Retail loans and loans for farming also come under this. As of now, this scheme is only available in Mangalore zone but will soon introduced in every Corp branch in the country.
8th August 2016
HSBC, OBC Life & Canara Bank Join Hands TO Launch iNVESTSHIELD plan
Oriental Bank of Commerce (OBC), HSBC and Canara Bank have come together to launch a brand new linked insurance plan known as 'iNVESTSHIELD' . this plan has been introduced with the aim of not only providing protection but also help an individual meet his or her present and future financial needs.
The iNVESTSHIELD plan is an online linked plan which customers with the ‘Premium Funding’ option. Under this option, in the unfortunate event of the passing away of the life insured, not only will the policy provide the advantage of immediate benefit payout (calculated as 105% of the premium paid or Sum Assured, whichever is higher), the remaining premiums for the remainder of the policy term will be funded by the insurer. The fund value will be paid upon maturity. Additionally, based on their risk appetite, customers can choose between multiple funds and switch between systematic investments and funds.
5th August 2016
Tata AIA Life announces Several Initiatives Towards Improving Customer Experience
Tata AIA Life Pvt. Ltd., one of India’s foremost insurance organization, has introduced several initiatives to improve customer experience and bring about greater customer satisfaction. The company has come up with several initiatives to strengthen its motto of 'Making good happen' while also providing 'Ease of doing business' for its customers.
As a part of these initiatives, the company has released a special charter which lists out pre-defined timelines regarding various processes like address proposal, service request, payout, claim settlement, grievance Redressal, etc.
The initiatives undertaken by the insurer have begun to yield results already. This is especially evident in the claim settlement area where the company has recorded a high individual claim settlement ratio of 96.8% fir the fiscal o 2015-16, which is also one of the highest to be recorded by any player in the private insurance segment.
4th August 2016
Axis Bank Partners With LIC To Sign Largest Bancassurance Deal
LIC (Life Insurance Corporation) has recently entered into an agreement with Axis Bank, one of the nation’s leading banking institution, to sign one of the biggest bancassurance deals. As a part of the agreement, Axis bank will now make LIC’s products available to it’s own customers.
Following the liberalization of norms directing sales of insurance products by banks, called Bancassurance, the Axis-LIC deal is one of the biggest tie-ups in this regard. Bancassurance, also known as channel sales’, is basically a model under which an insurance company partners with a bank to sell its products to a wider audience. a model where the insurance company join hands with a bank in order to sell its products.
In the initial stages of the deal, Axis Bank will distribute life insurance products offered by LIC. Sale of these products will be carried out at all Axis Bank branches located in Bangalore, West Bengal and Haryana – Panchkula. The bank will also provide after sales facilities like premium collection and renewal of policies.
3rd August 2016
Bareilly becomes home to SBI’s digital branch
Banks across the country are working towards incorporating technology into their functioning, with digitisation set to improve the way we bank. State Bank of India, the largest lender in the country took a step towards this by launching its first digital branch in Bareilly. Titled ‘sbiINTOUCH’, these branches will provide banking solutions to the modern, techno-savvy customer, with individuals having the ability to open accounts, print personalised debit cards and seek banking advice via video-conferencing.
Mr. Sunil Kumar Wadera, the Deputy General Manager of Bareilly region inaugurated the branch. A manager and customer reps will be present at the branch, guiding customers on how to use the digital interface and other facilities available. Individuals can open an account in under 10 minutes, thanks to an interactive ‘Account Opening Kiosk’, with another machine to print customised debit cards also on the anvil. SBI currently has 10 digital branches in Uttar Pradesh, with the bank looking to expand these branches to provide unique digital banking solutions to customers. In addition to banking products, a video conference room will help customers get an insight on products like life insurance, mutual funds, etc.
31st July 2016
27% Rise In HDFC’s Net Profit After Sale of Investments
India’s largest mortgage lender HDFC (Housing Development Finance Corp. Ltd.) has made 27% higher profit owing to its one-time gains from its investments’ sale. A profit of Rs.867.52 crore was reported by HDFC during the quarter ending in June. Out of this, sale of its 22.9% stake in the general insurance arm HDFC ERGO to partner International AG generated a profit of Rs.725 crore.
HDFC’s listed subsidiaries generated unrealised gains totalling up to Rs.64,375 crore. 33% of the consolidated profit of the company came from the subsidiaries of HDFC. Within a year, the revenue of the company went up by 15%, from Rs.14,726.18 to Rs.17.012 crore. HDFC reported a decent 7.8% rise in the net interest income to Rs.2,283,05 crore in the June quarter.
30th July 2016
4% Fall in Bajaj Finserv Shares Followed by Q1’s Missed Estimates
Bajaj Finserv, which deals with financial services such as life insurance, Bajaj Finserv and general insurance, made a total income of Rs.2,912 crore, out of which the net profit reported was Rs.538 crore.
The poor performance of the company’s general insurance business was a result of the company’s overall ratings. According to Bajaj Finserv, there was a 9% fall in the general insurance arm’s profit, before its tax deduction, at Rs.196 crore. The company had recorded a total income of Rs.2,212 crore with a net profit of Rs.467 crore in the previous financial year.
29th July 2016
SBI Life launches 'Smart Privilege', a ULIP For HNIs
The nation’s largest public sector bank, State Bank Of India, recently launched a new ULIP product specially designed for HNIs (high net worth individuals). Smart Privilege is a focused market linked life insurance plan which was launched by the insurance arm of SBI known as SBI Insurance.
Smart Privilege is an insurance product which fulfils a dual purpose of allowing the investor to not only grow their wealth via investment but also provides life insurance cover. Customers can choose from a range of 8 choice funds in which to invest. Additionally, they have the flexibility to invest in a combination of funds as per their choice, along with which they have the flexibility to switch between funds and redirect their premiums any number of times during the term of the plan.
For the Regular & Limited Premium Plans, the minimum age of eligibility of 8 years, while for the Single Premium Plan, the minimum eligible age is 13 years. the maximum eligibility age for the plans is fixed at 55 years. Regular and Limited Premium policies can be taken for a term of 10 years to 30 years, while the Single Premium Policy can be taken between a term of 5 years to 30 years. Premium payment for these plans can be done in a single lump sum or on a monthly, quarterly, half yearly or yearly basis.
28th July 2016
Reliance Nippon Looking To Expand, Eyeing Tie-ups With Banks
Reliance Nippon Life Insurance, a partnership between India’s Reliance Capital and Nippon Life Insurance, Japan, recently announced that it is looking to partner with banks as a part of its expansion activities. Mr. Manoranjan Sahoo, Chief Agency Officer at Reliance Nippon made the announcement, during which he said that banks have been granted approval by IRDAI to tie-up with insurance companies. He also mentioned that that the company is planning to appoint about 30,000 agents out of which 4,000 agents will be appointed in Tamil Nadu in the current fiscal year.
27th July 2016
New Business Premium Contributes To 33% Growth of Life Insurance Industry
In the very first quarter of the financial year, the Indian life insurance industry has recorded robust growth which has been driven by new business premium. Going with the data released by the Life Insurance Council, new business premium has risen by approximately 33.2%, for the quarter which ended on June 30, 2016. As compared to Rs 23,568.14 crore which was recorded under new business premium, the same has risen to Rs 31,392.23 crore in the first quarter of the current financial year.
Life Insurance Corporation of India, the public sector life insurance company, recorded a growth of 37.53% under the new business premium category during the first quarter of the on-going financial year. The company’s total income from premiums rose from Rs 16,428.23 (during the previous fiscal) to Rs 22,592.22 crore.
The private sector insurance industry which consists of 23 members recorded a growth in new business premium by 23.23%. Income from new business premium for the first quarter of 2016 was a total of Rs 8,798.34 crore, as compared to the previous year’s new premium earnings of Rs 7,139.91 crore.
26th July 2016
Insurance schemes to be the focus for the Department of Post
The Postal Department is looking to enroll more workers from unorganised sectors under the Pradhan Mantri Jeevan Jyoti Bima Yojana in Coimbatore. The Department would be focusing on three schemes, namely, Atal Pension Yojana, Pradhan Mantri Jeevan Jyoti Bima Yojana - life insurance and Pradhan Mantri Suraksha Bima Yojana - accident insurance. A cover of Rs. 2 lakhs would be provided for accident insurance with a premium of Rs. 12, targeting autorickshaw drivers, conductors, state transport drivers and travel agencies. The Department is also planning to target migrant workers in Coimbatore for accident insurance cover. Under life insurance, a cover of Rs. 2 lakhs with a premium of Rs. 330 would be given to unorganised sector workers.
25th July 2016
ICICI Pru Life IPO to be filed soon
ICICI Prudential Life Insurance, one of the largest private insurance companies in the country is all set to expand its horizon, with the company ready to file an Initial Public Offer (IPO) in the coming weeks. The IPO of its shares is valued at around Rs. 4,700 crore, making it the largest IPO after the Coal India IPO of 2010. ICICI Bank will offer secondary shares through this IPO, with all formalities set in place. The company will approach the Insurance Regulatory and Development Authority of India (IRDAI) to vet the document, post which it will be put in front of the Securities and Exchange Board of India (SEBI) for market regulation.
The IRDAI will be checking a number of factors before vetting the offer, including the past performance, solvency rate, capital structure, business record, etc. While approval from IRDAI could take up to a month, the SEBI is likely expected to take around 2 or 3 months to clear the IPO. The plan to offer an IPO received the get-go from the board of ICICI Bank in April this year. ICICI Pru has performed consistently over the last few years, amassing a profit of Rs. 1,650 crores in 2015-16, with assets worth Rs. 1,03,939 crore under its management. The company is currently valued at Rs. 32,500 crore, with the new IPO expected to strengthen its position.
24th July 2016
Insurance premiums increase by 33% in first quarter
The year 2016 has begun on a good note for insurance companies, with data released by the Life Insurance Council indicating a growth of 33% in terms of premiums in the first quarter of FY 2016-2017. Life Insurance Corporation of India (LIC) led the growth in terms of new business premiums, with premiums worth over Rs. 22,594 crore, a growth of around 37.5% when compared to the Q1 of last year. Private companies weren’t far behind in terms of new business premium, with a total of Rs. 8,798 crore received by them, indicating a growth of 23.23%.
The primary reason behind this strong performance is linked to Unit-Linked Insurance Plans or ULIPs. The overall premium collected by all companies was Rs. 31,392.5 crore for the quarter, up from Rs. 23,568 crore for the same period last year. While the premiums increased, there was a marginal increase in terms of premiums sold, with around 47 lakh policies sold in the current quarter, compared to 46.4 lakh premiums which were sold last year for the same period. Companies like Max Life Insurance, Kotak Mahindra Old Mutual Life Insurance and HDFC Life witnessed growth ranging between 23 and 78% in the quarter, signalling a great beginning to the year.
23rd July 2016
ICICI Pru Life Insurance Company Ltd. Files for the Largest Initial Public Offering
ICICI Pru Life Insurance Company Ltd. has recently filed for an initial public offering that will be the largest when compared to IPOs in the past 6 years. The initial public offering of shares from ICICI Pru is expected to raise over 745 million dollars. This will mark the highest IPO in India, since the launch of shares from Coal India Limited in 2010. ICICI Prudential Life Insurance Co Ltd offers products such as ULIPs, Term Insurance, Retirement Plans, Money Back Plans, Rural Plans, Group Life Insurance Plans, etc.
22nd July 2016
IndiaFirst Life Insurance Joins Hands With Nainital Bank
IndiaFirst Life Insurance recently announced that it will be joining hands with Nainital Bank Limited in order to expand its reach for better distribution of its products. IndiaFirst Life insurance is a joint undertaking Andhra Bank, Bank of Baroda and Legal & General (UK).
While recently making the announcement regarding the partnership, Rushabh Gandhi, Director of Sales & Marketing, IndiaFirst Life Insurance said that the partnership will not only help strengthen the company’s distribution network but also allow them to reach out to a larger customer base and establish a firm footprint in the Northern India region.
Also speaking on the occasion, Mukesh Sharma, Chairman & CEO , Nainital Bank Limited said that the bank will only stand to benefit from IndiaFirst’s extensive and dedicated product offerings and their illustrious performance record. Together, the partnership will help make complete financial solutions to many more customers.
21st July 2016
ICICI Prudential Life is most preferred private insurer for ULIPs
Insurance penetration in India has been steadily increasing, with a number of private players entering the fray, offering a host of products. Unit-linked insurance plans or ULIPs account for a major portion of all insurance policies, with competition between companies being fierce. A recent report indicates that ICICI Prudential Life Insurance Company is the most popular private insurer for ULIPs in India, occupying 23.1% of the overall market share. A major reason for this is the fact that ICICI Bank has backed the company, which has given it more credibility and access to individuals who can invest more in ULIPs.
The company raked in a net profit of Rs. 1,650 crore during FY 2016, a marginal increase compared to FY 2015. The total new business premium accumulated by the company was Rs. 6,765.89 crore, up by over Rs. 1,300 crore when compared to the previous year. SBI Life was the second most popular choice when it came to private insurers, followed by HDFC Life and Max Life.
20th July 2016
Bajaj Finserv Strikes Record High on The Stock Market
Bajaj Finserv, one of India’s leading financial services company recently hit a record high on the stock market with a rise of 21%, as opposed to the low 5% rise in the Nifty 50 index. Since the past 16 trading sessions, Bajaj Finserv’s stock has overtaken the market and grown by an impressive 21% from Rs 2,078 to Rs 2,511. According to media reports, Bajaj Finserv may possibly buy out Allianz’s stakes in Bajaj Allianz Life, talks for which are on.
19th July 2016
Reliance Nippon Life Insurance adding huge workforce as field agents.
Reliance Nippon Life Insurance Company has recorded that only 52% (68,000) of its existing 1,30,000 field agents are actively and regularly selling policies physically to customers. In a move directed at expanding their physical presence on the ground, the company plans to hire, train, and deploy at least 30,000 more field agents by the end of this fiscal year.
The company is clearly taking huge steps directed towards establishing itself as a respectable and dependable insurer in the country, by also announcing a customer-friendly policy change – the company is planning to launch a money-back plan through which customers get guaranteed money back benefits on specific policy anniversaries.
The company had also reported a loss of Rs.200 crore in the 2015-16 fiscal, following which the Reliance Nippon Life Insurance Company CEO Mr. Anup Rau resigned from his post, leaving the company afloat like a ship without a captain.
Big changes are on in the Reliance Nipping Life Insurance Company, and experts suggest that it’s a crucial time make or break time for the company.
18th July 2016
Premium collection increases by 7.9% in 2015 : Swiss Re sigma report.
As the demand for non-life and life insurance products has increased, the premium collection has grown by 7.9% in 2015, according to a Swiss Re sigma report. When compared to the previous year, the increase has been quite high. Life insurance premium collection improved by 7.8% according to the report. Investment-linked products which showed growth via bancassurance channels contributed to the increase. Non-life insurance premiums reported a growth of 8.1%, with contributions mainly from health insurance, motor third party liability premiums and personal accident insurance. Though the study showed that the premium collection has grown, insurance penetration across the country has to still increase.
17th July 2016
New Term Plans launched by Exide Life
Exide Life recently launched new term plans which come with return of premium to replace its regular term plans. Termed “Exide Life Smart Plan”, this new return of premium plan will provide life cover in addition to assured returns once the policy matures. Available in three variants, it aims to provide multiple options to individuals. The existing regular term plan will be discontinued by the company, primarily on account of more demand for plans which offer return of premium. The three variants of this plan are the Classic, Step-up and Comprehensive, with the Classic plan offering 100% return of premium, the Step-up offering returns ranging between 110-150% of the premium and the Comprehensive offering partial return of premium. Policyholders can also choose to enhance the policy by opting for riders like a critical illness cover and an accident cover.
16th July 2016
Life insurance sector in India records a 13.8% growth in May
Life insurance companies have recorded an average premium growth of 13.8%, year-on-year, for the month of May. This amounts to a total of Rs. 17,952. Life Insurance Corporation (LIC) has shown a growth of 14.1% in average premium, amounting to Rs. 12,526. For private insurance companies, the average ticket size grew by 10.6%, amounting to Rs. 37,111. Companies like HDFC Life, Max Life, Bajaj Allianz and Birla Sun Life saw a growth ranging between 20% to 40%. Other insurers like Reliance Nippon Life and Shriram recorded a growth of 2.7% and 4.1%, respectively.
Insurance Providers To Provide Tailored Products Online
The world of online retailing has opened up new avenues and prospects for a variety of insurance products. Owing to the cost-effective benefits due to the elimination of intermediaries, insurance companies are now offering travel, motor and health insurance products primarily via their websites. Online sales make up for up to 3% to 5% of the overall sales. Renewals further bump that figure to about 7% to 9%. Driven by this trend, insurance providers are now designing products based on customer reviews. Given that for millennials, the internet is nothing short of a lifeline, insurance companies are taking the cue and going the online way.
14th July 2016
14% growth in ticket size reported for life insurers.
This fiscal period last year saw the ticket size for life insurers at Rs.15,744 crore – but the same period this year reports a ticket size of Rs.17,952 crore – a growth of 14%.
This data is reported from the Life Insurance Council, indicates that the average reported growth for the size of life insurance policies has grown by 14% as compared to the same time period in the last fiscal year.
Life Insurers in India today sell both – Unit Linked Insurance Policies (ULIPs) and traditional insurance policies, and data indicates that policy size could drop among the larger insurers as more focus is being put on traditional products.
One of the problems currently being faced by insurers is that subscribers surrender their ULIPS. This is because the ULIPs are directly linked to the equity market – which is as volatile as it is rewarding, and panic surrendering of policies occurs during times of market lows.
The current average target set by most insurers is between Rs.30,000 crore and Rs.40,000 crore for Unit Linked Insurance Policies (ULIPs) and between Rs.25,000 crore and Rs.30,000 crore for traditional insurance policies.
Despite the popularity of ULIPs and the reported successes of private insurers who sell ULIPS, the Life Insurance Corporation of India (LIC) has reported a Rs.12,526 crore (14.1%) growth through the sale of traditional insurance policies.
13th July 2016
ICICI Prudential To Launch Its IPO during Current Fiscal
Chanda Kochhar, Managing Director & Chief Executive, ICICI Bank, recently announced that ICICI Prudential Life will be entering the capital markets in the current fiscal year with its initial public offer. Speaking at the 22nd AGM of ICICI Bank, Mrs. Kochhar said that the bank intends to launch the IPO during the current fiscal year, but the same will depend on the market conditions and approval which has to be given by the regulator. While no mention was made regarding the size of the IPO, this will be the first ever IPO to be launched by a life insurance company in India.
12th July 2016
IndiaFirst Teams Up With IFMR To Extend Policy Distribution In Rural Areas
IndiaFirst Life Insurance has recently partnered with IFMR Rural Channels and Services Private (IRCS) in order to enable the distribution of insurance policies to those residing in remote rural districts of the country.
According the release, IFMR is offering life insurance policies via Kshetriya Gramin Financial Services (KGFS) in its 4 centres which are located in 5 districts in Uttarakhand, Odisha and Tamil Nadu. As a part of this association, IFMR plans to distribute the IndiaFirst Simple Benefit Plan which is a non-linked individual participating endowment Plan offered by IndiaFirst Life Insurance. R. M. Vishakha, CEO and MD for IndiaFirst Life Insurance said that this tie-up will enable IndiaFirst to make their products available in the mass market which will allow them to participate in financial inclusion.
11th July 2016
Bharti AXA Life Monthly Advantage - new scheme by Bharti AXA
The insurance major Bharti AXA has launched a new life insurance scheme called the Bharti AXA Life Monthly Advantage. It is a limited pay, traditional life insurance plan which offers guaranteed monthly pay outs till the maturity of the policy. Annual reversionary bonus gets accrued from the end of first year of policy and gets paid out at the end of the maturity. This is a non-guaranteed and component and may get paid only on maturity, death or accidental total permanent disability of the policyholder.
Bharti AXA aims to make it easy for young couples to plan and save for the future and hence this new scheme is aimed at helping policyholders save in small amounts and take advantage of the monthly additional income which can also be invested further to generate more income for a later stage of life.
10th July 2016
By 2030, EPFO aims to cover all under PF and pension
Employees Provident Fund Organization or the EPFO has a goal of reaching out to the entire population of India and cover them under the PF and pension schemes by the year 2030. This is as per the vision document of the EPFO. The document has goals like universal social security coverage via pension scheme, PF and insurance. Best service delivery practices and state of the art technology are also parts of the vision document.
A meeting between Central Provident Fund Commissioner, EPF Officer’s Association and the All India EPF Staff was held to identify and discuss the goals that the EPFO has for the year 2030. EPFO caters to over 3.5 crore subscribers and is the largest implemented social security scheme in the country.
9th July 2016
13.8% average ticket size growth for the Life Insurance industry
The LIfe Insurance industry saw an average growth of 13.8% for ticket size or premium payments in the month of May. The average premium size rose to Rs.17,952 for the month of May. Life Insurance Corporation, which is a public sector insurance undertaking, posted an increase of Rs.12526. For private insurance players, the average ticket size showed a growth of 10.6% on an year to year basis and the average was Rs.37,111.
However, two biggest private insurance players, ICICI Prudential and Kotak Mahindra saw a fall of 29.3% and 11.8% respectively in their average ticket size. The insurance industry has been facing issues since the recession in the year 2008. The government’s decision to allow foreign direct investment or FDI in insurance has placed the insurance industry in the path of new hope and opportunity.
8th July 2016
The focus is on traditional insurance products, says Reliance Nippon
As a part of its expansion plans, Reliance Nippon (life insurance provider) is set to launch three new products and pay more attention to products with assured returns. The chief agency officer of the company is said to have acknowledged that the company has filed for three products with IRDA, and are expecting quick approval on the same. Out of these three products, one is said to be ULIP (unit linked insurance plan), while the other two will be traditional insurance products. The last year wasn’t too promising for Reliance Nippon as it had experienced a negative growth. This year the company is expecting a huge rise in its business.
7th July 2016
Private insurers Register Higher New Premium Growth in May
Private insurers in India have recorded impressive growth of 26% in annualized new business premium for the month of May. This rise in growth is mainly attributed to the higher ticket size of the business. However, the state-owned Life Insurance Corporation of India (LIC) recorded a growth of 22% (year-on-year) in annualized first-year premium which was attributed to higher volumes.
In the individual non-single segment, for a majority of players, the average ticket size has increased by a whopping 30% to 40%. While on one hand, the private sector continues to grow its market share with the help of stable group business, LIC, on the other hand, continues to boast holding a higher share in terms of single premium business, a segment in which private players have been exercising caution and being selective. Under the group business segment, the share held by private players went up to 26% in May, which is a modest 6% rise from 20% in the month of April.
6th July 2016
Life insurance companies record increase in new insurance premiums.
There was a rise in new insurance premiums by 26.6% for the month of May according to collections made by insurers. Life insurance premium amounts rose from Rs. 8,382.67 crore to Rs. 10,610.10 crore. Private sector general insurance companies saw a growth of 25.8%, which amounted to Rs. 10,610.10 crore in new premium collection during May. This growth has occurred from a figure of Rs. 2,580.89 crore, which was recorded for the previous year. Life Insurance Corporation of India (LIC) registered a 27% growth in new premiums amounting to Rs 7,361.75 crore. Private sector insurers like HDFC Standard Life, SBI Life, Kotak Mahindra Old Mutual Life and Exide Life also showed a robust increase in new insurance premiums. SBI Life saw an increase in 156% to Rs. 842.08 crore, HDFC Standard Life to Rs. 502.59 crore, Exide Life to Rs. 127.46 crore and Kotak Mahindra Old Mutual Life to Rs. 197.66 crore. Other insurers also saw a rise, namely, Canara HSBC OBC Life recorded an increase up to Rs. 66.32 crore, Max Life to Rs. 66.32 crore, Birla Sun Life up to Rs. 188.91 crore , Bharti Axa up to Rs. 39.69 crore and IDBI Federal Life up to Rs. 40.65 crore.
4th July 2016
Mergers in the insurance sector on a rise
After the much anticipated merger between Max Life and HDFC Life, Bajaj Finsery has been looking for a merger too. The Managing Director, Sanjiv Bajaj, of Bajaj Finsery opined that life insurance sector has a huge opportunity of growth in context to mergers. Though he refused to comment on the rumours of Finsery buying out Allianz’s stakes, he acknowledged that talks have been going on regarding a merger. Bajaj aims at strengthening its presence in the life insurance sector. This sector hasn’t been seeing a huge rise in sales in the past few years, in fact there has been a fall as customers have been buying other types of insurance more widely. Gradually, they expect this trend to be changing for the better and resulting in an increased business for the life insurance sector.
5th July 2016
IRDAI approves electronic insurance for payment of life insurance policies.
Electronic insurance is to become a compulsory requirement for life insurance annual premium payments equaling to Rs. 10,000 or above. According to IRDAI’s Issuance of e-Insurance Policies Regulations, 2016, this rule would come into effect from October 1st, 2015.
New life insurance schemes have been introduced by the Coconut Development Board. The two schemes are Coconut Palm Insurance Scheme for farmers and Kera Suraksha Insurance Scheme for coconut climbers.
Indian cricketer, Mahendra Singh Dhoni would be the new face of Exide Life Insurance, where the sportsman will be featured in the “Lamba saath, bharose ki baat” marketing campaign.
3rd July 2016
IndiaFirst Life Insurance and Star Health Insurance come together for offering Combi plans
Star Health and Allied Insurance Ltd. in association with IndiaFirst Life Insurance made an announcement of launching Star First Combi Plans. This step has been taken with a joint venture between Bank of Baroda, Andhra Bank and Legal & General (UK). Star First Combi Plan is basically a combo of life and health insurance plans. This five stage plan is an innovative product as it is a unique combination of the best of health and life insurance plans. Customers can now experience the best benefits of two different insurance plans in just a single plan with the Star First Combi Plans. They will be provided both health and life coverage. The Managing Director of Star Health Insurance opined that this combi plan provides dual benefits and protection with respect to a situation where he/she falls ill and has the health insurance plan taking care, and if he/she loses his/her life in the process, the life insurance coverage comes into play. Being the first of its kind, the company is really hopeful and confident about this product’s success.
2nd July 2016
Dai-Ichi Life Insurance’s share in Star Union Dai-Ichi Life Insurance has increased to 44%.
The 18% stake held by public sector lender, Bank of India in Star Union Dai-Ichi Life Insurance Company (SUD) has been sold to Japan's Dai-Ichi Life Insurance for a cost of Rs. 540 crores. Dai-Ichi Life Insurance will now have 44% stake in Star Union Dai-Ichi Life Insurance, as compared to the previous 26%. Bank of India has taken this decision due to the increase in FDI limits for insurance, as per the law. The increase in stake for Dai-Ichi Life Insurance will come into effect after the required approvals. Bank of India’s shareholding in the company will get reduced to 30%. Another shareholder, Union Bank of India will continue to have 26% stake in Star Union Dai-Ichi Life Insurance.
1st July 2016
BigDecisions Partners With Edelweiss Tokio Life to Create Awareness Towards Critical Illness Insurance
BigDecisions.com, a News Corp owned platform which provides financial advice recently announced that it would be partnering with Edelweiss Tokio Life Insurance for #BounceBack, an initiative introduced to raise awareness surrounding the need for critical illness insurance in India.
The initiative has been started following the findings obtained from a survey and user data from BigDecisions.com’s which indicated the lack of awareness among people regarding this particular insurance. The survey conducted in this regard displayed that out of 3,70,000 visitors, only 2% were aware of critical illness insurance policies.
#BounceBack, launched in February, is a unique initiative which has been started with the objective of creating awareness about critical illness insurance.
30th June 2016
New Premium Collection by Life Insurers up by 27% in May
Life insurers have collected new premium of up to Rs.10,610.10 crore in May, which is higher by 26.6%. Last year’s collection around the same time was Rs.8,382.67 crore. Out of the 24 life insurers, the companies belonging to the private sector reported a 25.8% hike in new premium collection with Rs.3,248.35 crore in May, while last year’s collection was Rs.2,580.89 crore.
LIC’s new premium collection shot up 27% from May last year with Rs.7,361.75 crore. Some of the top private sector performers such as HDFC Standard Life, SBI Life, Kotak Mahindra Old Mutual Life and Exide Life reported a healthy hike in their new business premiums.
29th June 2016
Life Insurance Corporation (LIC) might announce Credit Enhancement Fund soon
Life Insurance Corporation (LIC) will soon set-up a credit enhancement fund to offer guarantees to infrastructure sector companies, helping them get funds from overseas markets and the domestic market at a low cost. The Secretary in the Department of Economic Affairs, Shaktikanta Das communicated the same in an interview. This move will help infrastructure sector companies receive credit enhancement. By utilising this facility, companies can grow from AAA- to AAA. The Credit Enhancement Fund would also help improve credit rating of bonds and attract long-term investments.
28th June 2016
Max Group opens offer to increase stake in Max Ventures to 75%
The Chairman of Max Ventures and Industries Ltd (MVIL) and Max Group promoter, Analjit Singh announced that the company would be opening options for stakeholders to invest in an additional 34.6% stake in Max Ventures. The promoter's stake would increase to 75% in Max Ventures and Industries Ltd. As per the Chairman , investors are looking to target health insurance, life insurance and allied activities. The investment offer is subject to provisions in certain laws inclusive of SEBI Takeover Regulations. Max Ventures has been evaluated for a market worth of Rs. 168 crores.
27th June 2016
Mahendra Singh Dhoni signed as Brand Ambassador for Exide Life Insurance
Cricketer Mahendra Singh Dhoni was signed as the brand ambassador for Exide Life Insurance. He will feature in the ‘Lamba saath, bharose ki baat’ marketing campaign of Exide Life Insurance.
According to the company’s Director-Marketing, Mohit Goel, Dhoni will be perfect for featuring in the campaign as his commitment and stability echo with the life insurance product. This is Dhoni’s first endorsement of an insurance product. He feels connected to Exide Life Insurance’s belief that long term relationships build trust.
26th June 2016
DHFL Pramerica Life launches health insurance
DHFL Pramerica Life Insurance Co. (DPLI) has stepped into the world of health insurance by launching DHFL Pramerica Dengue Shield. This is a direct customer product, which is available online. DPLI has entered into an agreement with ItzCash. This will provide a customer awareness program about the health insurance policy. It will use over 75,000 retail touch points across the country. DHFL Pramerica Dengue Shield is not just an innovative product but it is also extremely pocket-friendly. It offers a long term benefit for 5 years and protects the policyholder against medical/hospitalisation expenses being incurred due to dengue treatment.
25th June 2016
18% stake in BOI’s Life Insurance Venture Star Union Dai-Ichi Sold
In an announcement during an exchange filing, 18% stake in Bank of India’s life insurance venture Star Union Dai-Ichi was sold to Dai-Ichi, the largest life insurer in Japan. However, the transaction value was not disclosed by the bank. In the fourth quarter results, the bank’s chief, M Rego had announced the lenders plan to sell the non-core assets of the bank as well as stake in its subsidiaries, in an attempt to raise Rs.1,000 crore.
Dai-Ichi will now have a 44% share in the Indian life insurance venture from a 26% share, previously. While Union Bank will still have a 26% share, BOI’s share will drop from 48% to 30%.
24th June 2016
Merger with HDFC Life sends Max Financial Shares Soaring
Max Financial Services saw a rise in its shares by 20% touching the highest trading permissible limit for the day at Rs. 514.50 on NSE. Stocks soared by 19.99% reaching Rs. 514.40 on BSE, touching its upper circuit limit. The incline can be attributed to the merger between Max Financial Services, Max Life Insurance and HDFC Standard Life Insurance. This is India’s biggest consolidation in the sector of private insurance. The Board of Directors of all three companies entered into an agreement of confidentiality and exclusivity to assess a potential merger of Max Financial Services and Max Life Insurance into HDFC Standard Life Insurance.
23rd June 2016
SBI Life Insurance will be announcing the final decision on dilution of stakes soon.
A decision on the dilution of stakes favouring the foreign partner, BNP Paribas Cardif will be taken by SBI Life Insurance within a period of two months. This announcement was done by the CEO and MD, Arijit Basu. Currently, SBI Life Insurance has a joint venture of 26:74 with BNP Paribas Cardif, a France-based company. According to the CEO, BNP Paribas Cardif would get an additional 10% stake, incrementing the total to 36%. With the 2016 Budget increasing foreign investment to 49%, foreign investors are incrementing their stakes across the market. SBI Life Insurance is aiming to achieve a 40% growth in new business premium and also improve sales through bancassurance models.
22nd June 2016
Max Life and HDFC Life in talks for a merger
Predicted as one of the largest deals in India, HDFC and Max Financial Services have decided to look at the possibility of a merger of Max Life into HDFC Standard Life. The companies have said that the agreement that they have entered into is confidential and with the purpose of carrying out the merger. This is estimated to give birth to India’s largest life insurance company, in the private sector. HDFC Life boasts of assets worth Rs. 16,313 crore, and a substantial market share too. Max Life hold premiums of Rs. 9,216 crore, and a mention worthy market share too. A trusted source within the company claimed that post the merger, Max may enjoy holding 24% of the newly formed merged company.
21st June 2016
SBI Life Insurance Introduces ULIP – ‘Smart Privilege’ for HNI Market
SBI Life Insurance has introduced ‘Smart Privilege’, an ULIP focusing on higher income individuals. By opting for the product, customers can not only avail life insurance, but also a chance to earn through investments in eight of the top chosen funds. The combination of funds can be chosen by the customer. Customers will also be allowed the flexibility to switch between funds and redirect premiums, as many times they want, at any point of the term plan.
The minimum eligible age for taking up a regular or limited premium policy is 8 years, while for a single premium policy, the minimum eligible age is 13 years, while the maximum age is 55 years. The policy term option for regular or limited premium policies is between 10 to 30 years, while for single premium policies, it is between 5 to 30 years. Customers have premium payment frequency options of monthly, quarterly, half-yearly, annually or single.
20th June 2016
SBI Life Insurance targets 30% to 40% growth in new business premium
SBI Life Insurance is aiming to achieve a 30% to 40% increase in its new business premium for the year, 2016-2017. The company also aims to grow its gross total premium by 25% to 26% for the current fiscal year. SBI Life Insurance will focus on agency channels and banking for achieving this growth. A growth of 29% was got in total new business premium and 37% was recorded in rated individual new business premium by the company. Agency sales saw a 12% to 13% growth during the previous year. SBI Life Insurance is planning to increment the number of license-specified employees to improve sales. A new ULIP product will be launched soon for High Net Worth Individuals by SBI. Currently, SBI Life Insurance has 27 products for individuals and 20 products targeted towards groups.
19th June 2016
DHFL Pramerica Life Insurance (DPLI) offers Dengue Protection Policy Online
DHFL Pramerica Life Insurance (DPLI) is offering its Dengue Protection Policy online. This policy is called the “Dengue Shield”. The company feels that life insurance products are more relevant than other insurance products and should be readily available to the public. The digital platform offers better accessibility to this insurance cover. Dengue Shield is provided at a premium of just Rs. 1 for each day covered under the policy. The sum insured ranges from Rs. 25,000 to Rs. 50,000. The claims process is quick and easy, with no specific documentation requirements. The policyholder can choose either a annual premium payment option or the one-time premium payment option. By choosing the Single Premium Payment option, the policyholder can avail a discount of 21% on the premium. The Dengue Insurance Policy can also be taken as a group policy in the near future.
18th June 2016
DHFL Pramerica Launches Dengue Shield Insurance
DHFL Pramerica, a private life insurance company, has launched its first health insurance policy called DHFL Pramerica Dengue Shield. The policy has fixed benefits for individuals and is available online direct to the customer. Online products like this one have a mass market and are affordable for the customer. Dengue Shield starts as low as Rs.1 per day premium for a cover of Rs.25,000 sum insured. The highest sum insured available is Rs.50,000. The launch of this product was in partnership with ItzCash which will help it create awareness against dengue. DHFL Pramerica is clearly venturing into the health insurance space. The market can expect more health insurance products from DHFL Pramerica soon.
17th June 2016
Pension product numbers dwindle at life insurers
Since insurers are trying to get a level-playing field in the life insurance space with National Pension System (NPS), life insurance companies’ new pension products are continuing to reduce. In the Budget, there was introduction of more tax incentives for NPS. However, insurers did not give similar exemptions to pension policies.
In the budget, the finance ministry, claimed that 40% of the pension wealth received by an employee from the National Pension System Trust will be exempt. A uniform tax treatment was the aim in terms of the recognised provident fund, superannuation fund and national pension system.
16th June 2016
Insurance Providers Permitted To Offer Differentiated Pricing on Policies Online
The IRDAI (Insurance Regulatory and Development Authority of India) has recently declared, in its draft norms for insurance in e-commerce, that insurance companies and providers can offer different prices for the products which they sell online. This sale will be done via a self-network platform. This is a welcome move as until now, insurance products could not be sold at differentiated prices on different sale channels.
According to regulations, the self-network platform can be made available on different mediums like via mobile application, a website or even both. Only those organizations, including insurance companies, agents, intermediaries, etc., which have been granted a certificate of registration by the IRDAI will be permitted to sell their products. The range of products which will be allowed to be sold online include non-life insurance, life insurance and standalone health products as well.
Various officials associated with leading insurance providers have remarked on this decision. Sanjay Tripathy, senior executive vice-president of marketing, analytics, digital and e-commerce, HDFC Life mentioned how this decision will not only help in the prevention of insurance related fraud but also help lower the cost of insurance in the long term. K. G. Krishnamoorthy Rao, MD & CEO, Future Generali India Insurance, commented that now insurance providers will be able to provide discounts on the same products online. Sharad Mathur, senior vice-president and national head-agency, digital and alternate channel, SBI General Insurance, remarked that not only will this move help grow the insurance penetration in the market but will also enable insurance companies to offer its products to those residing in the rural parts of the country. This move will encourage more individuals to purchase insurance online which will automatically help lower the operating expenses of the company itself.
15th June 2016
Bajaj Allianz Life Insurance records a 7% growth in businesses.
Private insurer, Bajaj Allianz Life Insurance has announced that there has been a 7% growth in its newer businesses amounting to Rs 2,885 crore. This has been reported for the financial year, 2015-2016, which is comparatively higher than the figure of Rs 2,702 crore recorded for the previous year. Bajaj Allianz Life Insurance has seen an increase in its profits amounting to Rs. 879 crores for 2016. With regards to new businesses, Bajaj Allianz Life Insurance is on the top amongst other competitors. A 105% growth has been shown by Bajaj Allianz Life Insurance in new businesses amounting to Rs. 533 crore through the Business Procurement channel. This can be attributed to contribution from partners like Micro Finance institutes and Regional Rural Banks. Bajaj Allianz Life Insurance has settled 1,65,244 claims and carries a Claim Settlement Ratio of 98.07%, the highest for a private insurance company. The company had introduced various products in the previous fiscal year like Bajaj Allianz Life Principal Gain (a ULIP) to improve its growth prospects. As on March 2016, the Assets Under Management for Bajaj Allianz Life Insurance increased by 1% to Rs. 44,107 crore and the solvency ratio was maintained at 793%.
14th June 2016
New Digital Campaign Launched by Exide Life Insurance
A new digital campaign called the “#IncomeKaTopUp” has been launched by Exide Life Insurance. This social media campaign focuses on the Exide Life Income Advantage Plan which was recently introduced by the insurer. The campaign has been able to capture the interest of its target audience within the first week of release. It is promoted across social media sites such as YouTube, Facebook and Twitter. Through this campaign, Exide Life Insurance hopes to boost the sales of its new product and create awareness of its benefits among prospective customers.
13th June 2016
New set of rules to increase transparency of insurance agents
It is now compulsory for agents to disclose how much commission they will receive from a life insurance policy (how much from the premium). This used to be applicable for unit-linked insurance plans (Ulips) only before. Customers can also request their agents to provide appointment letter or identity card which should verify their authenticity.
Agents will have to let the policyholder know regarding their chances of the policy’s approval or rejection. Going forward, agents will have to disclose vital information of the policyholder, such as whether he/ she is a smoker, to the insurance companies since underwriting will be affected by this.
12th June 2016
Life Insurance Company HDFC had a massive increase in sales after it equipped its sales force with Tablets
Life Insurance Company HDFC equipped its sales force with tablets and apps which resulted in a huge increase in productivity. The overall TAT for Cancer Care policies have reduced massively. As one of the country’s leading private life insurance companies, it offers customers a variety of individual and group insurance solutions, It is also a joint venture between Standard Life PLC and Housing Development Finance Corporation Limited (HDFC). The life insurance segment comprises of pension, protection, investment, savings and health.
11th June 2016
Smart Suraksha Plan and Assured Nivesh Plan Launched by Canara HSBC Oriental Bank of Commerce Life Insurance
Two new life insurance plans – the Smart Suraksha Plan and Assured Nivesh Plan have been recently launched by Canara HSBC Oriental Bank of Commerce Life Insurance Company. The Smart Suraksha Plan is a protection plan that offers cover against the demise of the life assured. This aids in securing the future of his/her family and meeting their financial needs. The Assured Nivesh Plan is an endowment plan that offers an opportunity to enhance savings and avail life cover as well. The premium payment term is limited and the policy tenure is extended over and above this period.
10th June 2016
ICICI Pru Life Insurance to Make an Initial Public Offering Worth Rs.6, 000 Crore
ICICI Pru Life Insurance Company is planning to make an Initial Public Offering (IPO) worth Rs.6, 000 crore. If this happens, it would be the biggest first-time share sale in India. In the past 6 years, an IPO of this magnitude has not been made. ICICI Pru Life Insurance Company and ICICI Pru General Insurance Company are leading players in the insurance business. A plethora of life insurance products have been introduced in the market by ICICI Prudential, which contain expansive benefits.
9th June 2016
HDFC sells stake in HDFC ERGO General Insurance Company
In a move likely to strengthen its financial position, HDFC (Housing Development Finance Corporation) sold its stake in the joint venture with ERGO International AG. Valued at Rs.1,122 crore, this transfer saw HDFC giving up its 22.902% stake in HDFC ERGO General Insurance Company. A total of 12.336 crore shares were sold, with each share costing Rs.90.973.
HDFC earned a total pre-tax profit equivalent to Rs.922 crore, while the post-tax profit stood at Rs.725 crore, earmarking a smooth transition for the company.
8th June 2016
Canara HSBC OBC Releases New Policies
Two new products have been launched by Canara HSBC OBC Life Insurance Company aimed at financial empowerment. The schemes are titled Smart Suraksha Plan and Assured Nivesh Plan.
The Smart Suraksha Plan is a protection plan that offers high sum assured at affordable premiums. The plan is aimed at enabling the families of policyholders to sustain their lifestyle if something unfortunate were to happen to the insured.
The Assured Nivesh Plan is a savings cum protection endowment plan that includes limited premium payment term wherein premiums are collected for a reduced duration compared to the policy tenure.
7th June 2016
Reliance General Insurance Partners with IndusInd Bank to Offer Insurance Products
A Corporate Agency agreement was signed by IndusInd Bank, with India’s leading insurance provider Reliance General Insurance. This partnership was formed with the aim of offering insurance products through IndusInd Bank branches. IRDAI had recently issued guidelines for multi bank partner deals for Bancassurance and this has paved way for the partnership between Reliance General Insurance and IndusInd Bank. IndusInd Bank expects to provide life insurance, health insurance, etc. to its wide customer base. The products offered by Reliance General Insurance is backed by state-of-the-art technology and offers extensive benefits.
6th June 2016
Reliance Infrastructure Ltd’s net profit jumps to Rs. 659.85 crore.
Reliance Infrastructure Ltd has recorded a 43.7% growth in net profit for the fourth quarter. This has been made possible due to lower expenses and a one-time gain in its procurement, engineering and construction businesses. The company’s net profit increased to Rs. 659.85 crore from Rs. 459.11 crore for the quarter ending in March, as compared to the previous year. Reliance Infrastructure Ltd has also shortlisted two bidders, namely CPP Investment Board and Canada-based Brookfield Asset Management Inc., to fund its 11 operational roads assets.
5th June 2016
Life Insurance Corporation (LIC) aiming to double policy sales.
India’s largest insurer, Life Insurance Corporation (LIC) is planning to increase its business to Rs. 4 crore with regards to new policy issuance. This target is being set for the current fiscal year and LIC will be hiring 2 lakh agents to reach its target. Life Insurance Corporation (LIC) has recorded a 25% growth in new policy issuance and has a market share of 70.44%, for the year, 2015 - 2016. The first year premium income was 76.84% for 2015 - 2016. LIC’s market share was above 80% for individual single premium businesses and above 85% for group single premium. According to the Chairman of LIC, Mr. S K Roy, life insurance penetration in India is still low and the company is looking to improve this by issuing more policies. With rising competition, LIC is hoping to achieve its target with a new round of hiring that is expected to commence soon.
5th June 2016
Life insurance Sees 22% Growth From New Business Premium
The year seems to have started on a hopeful note for the domestic life insurance industry which recorded growth of 22.55%. This Improvement can be attributed mainly to growth in the segment of group single premium policy. Private insurance companies witnessed a growth of 17.63% while the state-run Life Insurance Corporation of India (LIC) recorded a higher growth of 24.74%, as compared to the previous fiscal year.
As per the recent data released by LIC, the life insurance market recorded business premiums at Rs 1.38 lakh crore in FY16, as compared to Rs 1.13 lakh crore which was recorded in the previous financial year. Private insurers, on the other hand, recorded business premium at Rs 40,983 crore previous financial year.
Majority out of the 22.55% growth which the industry has witnessed can be attributed the sale of group insurance policies. LIC alone experienced a growth of 46.1%, which can also be attributed to group single premium policies.
Many other prominent private insurers like SBI Life, ICICI Prudential, HDFC Standard Life and Birla Sun Life have recorded growth between the range of 14 percent to 30 percent in the previous fiscal year. SBI life recorded a growth of 28.55% in FY 16.
4th June 2016
LIC Raises Stake in 13 Companies, Buys Shares worth Rs. 8000 Crore
Life Insurance Corporation of India, one of the largest life insurance companies in India, has made use of market volatility to increase its stake in companies including TCS, HDFC Bank, HDFC and Maruti Suzuki, listed on Sensex. LIC has already been investing in blue chip companies whenever the market has been volatile and when Foreign Institutional Investors (FIIs) were selling. LIC not only sold shares worth Rs. 1852 crore in nine blue chip companies but also purchased shares worth Rs. 10, 000 crores in 13 sensex companies.
3rd June 2016
Birla Sun Life Launches SecurePlus Plan
Birla Sun Life Insurance (BSLI) recently introduced the BSLI SecurePlus Plan which is a non-participating traditional insurance plan. This plan will provide customers with a guaranteed secondary income during the payment period, which will double the amount of the yearly premium that has been paid with the life cover. Birla Sun Life Insurance is a subsidiary of Aditya Birla financial Services which deals in life insurance policies.
Talking about the SecurePlus Plan, Pankaj Razdan, MD & CEO at Birla Sun Life Insurance mention this plan has been specially designed to aid individuals maximize their income and also get a chance to earn twice as much income on their premiums.
The SecurePlus Plan provides cover to the policy holder for the term of the policy, at the end of which the policy holder will have to Income options to choose from. Option A entails that the policyholder receive increasing income of 1x to 6 times in a span of 6 years. The other option i.e. Option B which the policyholder has is to receive double the amount of premiums which they have paid for 12 years.
Talking about the advantages, all returns received on both these plans under the SecurePlus will be eligible for tax benefits. In case the life insured passes away unexpectedly during the Payment Period, the nominee named in the policy document will stand to receive the Income Benefit Pay-outs as per a pre-decided schedule. Therefore, this plan also ensured that your family stays protected financially in your absence. Under this policy, policyholders will also have the benefit of receiving life cover, along with a sum assured amount between the range of 14.5 times to 19 times of the amount of premium paid during the term of the policy. Also, policyholders can benefit from the built-in Accidental Death Benefit which is included in this policy.
2nd June 2016
Aditya Birla Nuvo Reports a Net Profit of Rs. 327 Crore
Aditya Birla Nuvo, a subsidiary of the Aditya Birla Group, recently reported a Net Profit worth Rs. 327 Crore. This profit was accrued from its diverse products such as life insurance products, telecom services, etc. The revenue earned from its life insurance segment during this quarter of the financial year is Rs 2,039.18 crore. This indicates an 11.76% increase from the profit earned in the same quarter of the last financial year. The revenue that the company earned from its other financial services is Rs 989.9 crore. Last year, the net sales during the quarter was Rs 6,318.41 crore and this quarter the net sales stands at Rs 6,957.32 crore.
1st June 2016
Government To Crack The Whip On Insurance Defaulters
Hyderabad State Transport Department has decided to tighten the noose on all vehicle owners who may be driving without legal insurance documents. This decision comes after several insurance companies have shared details of vehicle owners, who are insurance defaulters, with the law enforcement authorities. The data which is likely to have been submitted includes details like the class of the vehicle, insurance premium amount yet to be paid by the defaulter, details of the insurance defaulter, etc.
According to data released by IRDA (Insurance Regulatory and Development Authority of India), more than 55% of vehicles plying all over the country are doing so without valid insurance documentation. Also, close to 60% of vehicle drivers falling under the Cyberabad Police jurisdiction have failed to renew insurance policies for their vehicles.
Transport Commissioner, Sandeep Kumar Sultania has said that the data provided by the insurance companies will be synchronized with the database of the Transport department, which in turn will aid the authorities to track down the insurance defaulters.
Speaking of road safety, the police officials have mentioned that the number of road accidents has come down in the recent times. However, the majority of vehicles which are involved in fatal these accidents are often plying without valid insurance documents.
31st May 2016
Birla Sun Life Expecting 13-14% Rise In Individual Premium Income
The life insurance subsidiary of Aditya Birla Financial Services, Birla Sun Life Insurance (BSLI), is expecting a growth of about 13% to 14% from individual premium income for the current fiscal year.
In the past year, Birla Sun Life BSLI registered an overall premium related income of Rs 5,700 crore, out of which Rs 700 crore is attributed to individual premium income, Rs 1,400 crore from corporate premium income and Rs 3,000 from renewals, beside others. The company boasts a market share of 7.7 % in the Indian private sector insurance market.
Panjak Razdan, BSLI Managing Director and Chief Executive, said that the productivity of BSLI agents has risen by 14 % in the past fiscal year. Not only is the company expecting to recruit more agents in the near future but is also expecting a similar rate of growth in the current year, in terms of the performance of their agents.
Speaking about ULIP, Mr. Razdan said that it had grown by 36% in the previous fiscal year and the company is expecting the investment to grow by another 35% to 40% in the current year.
Birla Sun Life currently operates via a network of 70,000 agents and has 3 bancassurance partners – Karur Vyasya Bank, DCB and Deutsche Bank.
31st May 2016
Bajaj Finserv Registers Rs 517.9 Crore Profits For March quarter
For the quarter which ended on March 31, 2016, Bajaj Finservregistered overall net profits of Rs 517.95 crore, as compared to Rs 707.12 crore which was the profit recorded for the corresponding quarter of the previous year. These profits can be attributed to the transfer of the policyholder’s surplus to the accounts of shareholders which is done on a quarterly basis in FY16. The overall net profits for the company stood at Rs 1,863 crore, a 10% growth from FY15, when the profits were recorded at Rs 1,690 crore.
During the course of the year, as per the regulations of the Reserve Bank of India, Bajaj Finserv also acquired the status of a Core Investment Company (CIC), which makes it the holding company for all financial services related businesses for the Bajaj Group.
30th May 2016
IRDAI to Issue Revised IPO Guidelines For Insurance Firms
Insurance Regulatory and Development Authority of India (IRDAI) has announced that it will be issuing revised IPO guidelines to insurers. The announcement was made by IRDAI Chairman, T.S. Vijayan, who also mentioned that total foreign investment in the sector has gone up to Rs 15,000 crore in the past one year with increase in the limit of Foreign Direct Investment. This increased investment is mostly in form of equity ,following the passing of the Insurance Laws (Amendment) Bill in March 2015. The said bill has elevated the limit of foreign investment in the sector to 49 %, a long way up from 26 %. He also added that additional investments may materialize in the future.
Looking at the performance of the insurance sector from the last fiscal year, life insurance has grown by 12%, non-life insurance by 14% and the health insurance sector has grown by an impressive 40%. However, health insurance displays much higher potential, the penetration of which is currently rather low.
Talking of IPO guidelines, HDFC Standard Life has made an announcement regarding its plans to launch its Initial Public Offer (IPO). ICICI Prudential , too, is planning to launch an IPO.
29th May 2016
IIB To Hold Conference On Insurance Analytics & Ratemaking
Two themes for the IIRFA 2016 are Financial Inclusion in Insurance and Ratemaking & Insurance Analytics. The agenda for the conclave includes panel discussions on Fraud Control using Big Data Analytics and the integral linkages between micro-finance and micro-insurance. Also part of the program are special session to be held on Life Insurance Analytics and Disaster Management and Financing.
The event will be attended by speakers who are a part of the regulatory sector, members of Indian (government and private sector) insurance industry (Life & Non-Life) and individuals employed with the top management at insurance data bodies in Asian countries like China, Japan, Malaysia, Thailand, Korea and Taiwan.
Top speakers at the event includes personalities like BN Narasimhan (General Manager, GIC Re), Vijay Mahajan from Basix India, Sanjay Datta from ICICI Lombard General Insurance, Munling Chung (Deputy Director at Taiwan Insurance Institute), Worasit Thititanakarn (Advisor, Insurance Premium Rating Bureau, Thailand) and Kazunori Onoe (Managing Director, General Insurance Rating Organisation of Japan).
28th May 2016
Kotak Mahindra Bank shows a 37% growth in Q4 net profit.
Kotak Mahindra Bank has recorded an increase in its fourth-quarter profit by 15.63%, which amounts to Rs. 1,055.23. The income of the bank grew by 28.16% to up to Rs. 7,910.41 crore. Kotak Mahindra Bank has seen a net interest income growth by 5.2%, every quarter and by 65.40%, every year. A 2.9% qoq loan book growth and a sequential margin growth by 4.35% was recorded. Except broking, there was adequate growth in life insurance businesses and investments for the fourth quarter.
27th May 2016
Over 96% of Death Claims Paid out by Bajaj Allianz and Max Life in 2015-16
Bajaj Allianz Life Insurance and Max Life Insurance have both managed to reach the claims paid ratio of 96% during the FY 2015-16. Max Life touched a claim ratio of 96.23% while Bajaj Allianz managed to touch a claim ratio of 96.03%.
26th May 2016
Edelweiss to concentrate on Insurance Services
Edelweiss’ insurance business has registered a compounded annual growth rate (CAGR) of 35 per cent after the group entered insurance business in 2012. Over this period of four years, the premium collection has increased by 61 per cent and going forward, the insurance business for Edelweiss is expected to increase by about 10 to 12 per cent. The company has also recorded a 15. 2 per cent increase in net profit which was registered at Rs. 122 crores. The consolidated income has also increased by 13. 3 per cent. Edelweiss looks to expand the business network with a cash equity of Rs. 900 crores.
At present, Edelweiss has tied up with Tokio Marine to offer Life Insurance Products in India.
25th May 2016
DHFL Pramerica Posts 27% Rise in Profits
DHFL Pramerica Life has posted 27% growth in profit after tax deductions for the FY 2015-2016. The company revealed an overall profit of Rs.50.8 crores in the fiscal year.
This figure is higher than that for FY 2014-15 when profits for the private insurer stood at Rs.39.9 crores.
The company’s Gross Written Premium (GWP) rose by 25% during the last fiscal to a little over Rs.920 crores. The GWP figure for FY2014-15 stood at a little over Rs.735 crores.
The company also posted 25% growth in New Business Premium (NBP) during FY2015-16 to a little under Rs.730 crores, with the figure standing at just shy of Rs.580 crores for FY2014-15.
The insurer also posted growth of about 32% in asset under management to over Rs.2,000 crores, as compared to little more than Rs.1,500 crores in FY2014-15.
24th May 2016
Canara HSBC Oriental Bank of Commerce Life Insurance’s Net Profit up by 22%
Canara HSBC Oriental Bank of Commerce Life Insurance has recorded a 22% growth in their net profit for the year, 2015-2016. The net profit for the financial year 2016 was Rs. 126 crore as against Rs. 103 crore achieved in 2015, with business premiums going up by 35%. Canara HSBC Oriental Bank of Commerce Life Insurance is the only insurer to have a 100% bancassurance model, where insurance is sold through the bank. The insurance company also had a 53% growth on GWP - Gross Written Premium as compared to the previous year.
23rd May 2016
Bancassurance Partnership between Future Generali Life and Saraswat Bank
An agreement has been signed between Future Generali Life Insurance and Saraswat Bank for a bancassurance partnership. Going forward, the Saraswat Bank will be able to sell Future Generali’s products to customers spread throughout the country. The bank has 250 plus branches to help cater to customers in major regions including Maharashtra, Madhya Pradesh, Gujarat, Karnataka, Delhi and Goa.
18th May 2016
Aviva concludes 23% additional acquisition in Indian JV
Aviva has bought an additional 23% stake in its Indian joint venture with Dabur. The new regulatory changes in extending the limit of FDI in insurance in India to 49% has been the reason why Aviva PLC has gone ahead with the deal.
A statement from the company said the acquisition will have overall neutral impact on the net assets of Aviva. This deal comes even as many other insurers have extended their stakes in Indian JVs or are in the process to do the same.
17th May 2016
Unemployed EPFO members to get life insurance cover
There is some good news for unemployed ex employees of EPFO.The government stated that it will offer life cover to jobless ex employees of state run Employees’ Fund Organisation as long as they find employment in three years. The ex employees will be offered life cover at a nominal premium amount for up to three years from the time they are unemployed. This will be a relief to employees of the organised sector who lose insurance cover the moment they are unemployed. This move comes after the government’s decision to scrape the new rules regarding provident fund withdrawals.
16th May 2016
Ujjivan Financial Services raises Rs.264.74 crore through anchor allotments
Ujjivan Financial Services recently allotted about 12,607,081 equity shares at Rs.210 per share which approximately comes up to Rs.264.75 crores. The anchor investors included some of the leading domestic investors including insurance players such as Reliance Life Insurance, HDFC Standard Life Insurance along with other investors such as LIC Nomura Mutual Fund, Reliance Mutual Fund amongst others.
15th May 2016
SBI Life Insurance reports a growth of 5%
SBI Life Insurance reported a growth of about 5% in net profit at Rs. 861 for the year at the end of March 31st. The company had recorded a profit of Rs.820 crore last year in 2014-2015. The individual new business premium of the company stood at Rs. 3,757 crore the last fiscal year and has increased by 33% this year at Rs.4,987 crore. SBI Life Managing Director stated that the company has witnessed tremendous progress this year with a growth of 29% in total new business premium and a growth of 37% in rated individual new business premium.
12th May 2016
SBI Life claim Golden Peacock National Quality Award – 2015
Dubai’s Hotel The Meydan hosted the Golden Peacock National Quality Awards Presentation Ceremony for IOD India’s 26th World Congress on Leadership for Business Excellence and Innovation at which SBI Life Insurance claimed the Golden Peacock National Quality Award for 2015. In attendance to collect the award was the company’s executive director, COO, The Consul General of India, Dubai, and other big names from the insurance sector.
Golden Peacock National Quality Award is among the most prestigious and coveted laurels awarded in recognition of significant achievements. SBL Life intends on building its brand equity on quality management and processes and believes that the award will stimulate them to gain a competitive edge in the ever-changing modern market place.
12th May 2016
Private Life Insurers witness a growth of 14% in 2015-2016
Private Life Insurers in India witnessed a decent growth of 14% in premium income for the year 2015-2016. The adjusted premium equivalent of private life insurers shot up to 14% year on year to 24,112 crore for the year 2015-2016 while the adjusted premium equivalent of the life insurance industry grew 12% year on year to approximately 52,000 crore for the last financial year. The premium earned by the biggest players slowed down but banks like SBI Life, Canara and HSBC still gained market share. Banks like ICICI bank which recorded the fastest growth of 41% in 2014-2015, witnessed a moderation in 2015-2016.
10th May 2016
Saraswat Bank and Future Generali Life Insurance join hands with bancassurance partnership
A bancassurance partnership agreement was signed yesterday in Mumbai between Saraswat Bank and Future Generali Life Insurance Company.
As per the agreement, Future Generali Life Insurance Company’s customized products will be available to customers through Saraswat Bank’s network of around 250 bank branches.
This expands the distribution of Future Generali Life Insurance Company’s insurance products and also strengthens its distribution network.
10th May 2016
Max Life Insurance wins Celent Model Insurer Award
Max Life Insurance, a leading private insurer in India added another feather to its cap by winning a prestigious award at Celent Model Insurer Award 2016. The company which is a joint venture between Max Financial Services Ltd. and Mitsui Sumitomo Insurance Co. Ltd won an award in the ‘IT Management Best Practices’ category. The award was received by R. Krishnakumar who is the CVP and Head Business Performance, Analytics of Max Life Insurance. The award ceremony was held in Singapore.
9th May 2016
PNB Metlife wins an award at an event hosted by Celent
PNB Metlife recently won an award in an event held in Singapore which was hosted by Celent. PNB Metlife which is known as one of the leading life insurance providers in India won Celent’s Model Insurer Award 2016 on April 21st 2016. The company is well known for delivering customer-centric experience through their mobile responsive e commerce sales platform with an efficient user interface. The ecommerce sales platform is integrated with core IT systems and makes it possible for efficient customer on-boarding.This achievement acknowledges the amazing work the company is doing in the insurance sector.
9th May 2016
Future Generali Life Insurance introduces a new plan!
Future Generali Life Insurance, one of the leading insurers in India has launched a new online plan- Future Generali Easy Invest Online Plan. This new insurance plan is a unit linked insurance scheme that offers a wide range of investment as well as loyalty addition options.
This product is mainly targeted at the tech savvy crowd who wish to invest in online plans which can be easily purchased online. This is the second online plan by the company.
8th May 2016
Insurance Companies To Partner With Small Banks & MFIs To Improve Reach
There is no doubt about the fact that the penetration of insurance products in India is not what it could be. To address this issue, the IRDA had pointed out the fact that insurers were concentrating a lot on the urban sector and not enough on the rural sector. To help remedy the situation, and improve the reach of the insurance companies, insurers are now entering into partnerships with small banks, micro finance companies and even co-operative banks. This move has led to agreements being signed between Bajaj Allianz and Kalupur Commercial Co-operative Bank for the distribution of microinsurance. Even HDFC Life has entered into an agreement with Indiabulls Housing Finance while Cigna TTK Health Insurance has partnered with Saraswat Bank which promises to give it a stronger base in six states since Saraswat Bank happens to one the largest urban co-operative banks in India.
8th May 2016
Growth in First-year Premium for Life Insurers
A 14% year-on-year increase in annualised first-year premium was reported by private insurance companies. Life Insurance Corporation of India, the state-owned company reported a growth of 10% as both group as well as individual business intensified operations between the start of October last year to the end of March this term.
Private insurers accrued market share due to impressive growth in bancassurance. The insurance premium for low-margin groups in the industry as a whole rose by 46% in March 2016 as private insurers experienced 31% year-on-year growth. Meanwhile LIC experienced a growth of 50%.
7th May 2016
Exide Life Insurance launches a unique insurance plan
Exide Life Insurance which is one of the leading life insurance providers announced the launch of a unique insurance plan that also helps you build on your savings. ‘Exide Life Income Advantage Plan’ is an insurance plan that offers regular guaranteed income along with adequate life cover. The plan offers you two income payout options to choose from.The best advantage of the plan is that the insured is required to pay premiums only for the first half of the policy term and can enjoy guaranteed income every year for the rest of the policy term.
7th May 2016
Subhrajit Mukhopadhyay appointed as Chief Actuary for Edelweiss Tokio Life Insurance
Subhrajit Mukhopadhyay was appointed as the chief actuary of Edelweiss Tokio Life Insurance and is responsible for the controls of its actuarial business.
Mukhopadhyay was previously working as the chief actuary at Avantha ERGO Life Insurance and was also a part of their executive management team. A member of the Institute of Actuaries in India, he has previously worked at reputed companies such as Exide Life Insurance which was formerly known as ING Life Insurance and also Life Insurance Corporation of India in various roles.
The MD and CEO of Edelweiss Tokio Life Insurance, Deepak Mittal said that with Subhrajit Mukhopadhyay addition, the company would continue investing in a range of products to provide customers with a wide variety of solutions.
6th May 2016
DIIs, LIC Respond Well to NHPC’s Sale Offer
NHPC’s OFS (Offer for Sale) earlier this week received a good response as Life Insurance Corporation, the state-owned life insurance provider, having placed a notable bid. The offer for sale witnessed a subscription of more than 1.5 times as bids flowed in for 156 crore shares came from domestic institutions, according to sources. The government intends to sell around 125 crore shares in total or 11.6% of the power generator.
Retail investors are also expected to participate in the purchase of the shares. If all the shares on offer are sold, the exchequer expected by the OFS will amount to around Rs.2700 crore. The government presently owns around 86% stake in NHPC, but that figure is expected to drop to 74.6% after the issue.
3rd May 2016
Olympic Participants offered a cover of Rs. 1 crore by Edelweiss Tokio Life
All 75 athletes representing India in 2016 Rio Olympics including Saina Nehwal, Gurpreet Singh, Jitu Rai, Vikas Krishnan and Devendro Singh have been offered a life cover worth Rs. 1 crore by Edelweiss Tokio Life Insurance. It was announced that Edelweiss Group, a company that has a stake in the life insurance company Edelweiss Tokio Life Insurance will be the main partner of The Indian Olympic Association for Olympics 2016 in Rio.
This announcement was made in the illustrious presence of the Olympic boxer M C Mary Kom and Sardar Songh, captain of the Indian Hockey Team (Men) and Captain of the Women’s Indian Hockey Team, Ritu Rani.
1st May 2016
Gross Written Premium for Shriram Life Insurance Exceeds Rs.1,000 Crore in 2015-16
Shriram Life Insurance, a private sector life insurance company has recorded a 38% increase in its gross written premium, registering Rs.1,020 in the financial year 2015-16. The previous financial year witnessed Shriram Life Insurance’s gross written premium recorded at Rs.741 crores. The figures for 2015-16 included renewals for Rs.314 crores and NBP accounts for Rs.706 crores, according to a statement from the company.
During the financial year 2015-16, Shriram Life Insurance sold 2.67 lac retail policies, and Manoj Kumar Jain, the Managing Director of the company revealed that Shriram Life Insurance is committed to spreading awareness regarding the importance of life insurance. The average ticket size of Rs.13,000 in addition to the growth in retail policy speaks volumes about the company’s enterprise towards ensuring that the masses are insured.
Mr Jain also stressed on the company’s phenomenal growth in the recent past, stating that Shriram Life Insurance managed to register 50% of its business from markets in the north. According to Mr Jain, the expansion upon which the company embarked in the past three years has begun delivering results. The company’s branch network has more than doubled in this period, growing from around 200 branches to more than 530 at the moment, and the company continues its penetration into Tier Three and Tier Four cities through the addition of over 75 branches in the present financial year.
For the present financial year, Mr Jain revealed that the company was confident of growing by another 25-30% on all business parameters.
30th April 2016
AIA increases stake in Tata AIA Life Insurance
It was recently announced that AIA group has increased its stake in life insurance joint venture with Tata Sons. AIA Group Limited and Tata Sons entered a joint venture to launch insurance products in 2001. It was announced on Monday that AIA group has increased its stake in Tata AIA Life Insurance from 26% to 49%. The stake sale was completed successfully after availing all government and regulatory approvals. AIA group is well known for its insurance products and has its headquarters in Hong Kong with branches in 18 other countries.
29 April 2016
Bharti AXA Launches New Life Insurance Plan
The life insurance provider Bharti AXA has announced a new non-participating life insurance plan that provides money back benefits. It comes in two variants, the Super 6 and the Super 10 which differ from one another in terms of the policy tenure. Between the two variants the plan can offer anywhere from 270% to 396% of the sum assured as a benefit of the policy. The plans offer payouts after a certain policy period is completed and also comes with features like maturity benefits, tax benefits, death benefits and Guaranteed Maturity Additions. The plan can also be coupled with the waiver of premium and hospital cash riders to help enhance its cover.
26th April 2016
23% Stake in Birla Sun Life sold by ABNL for Rs.1,664 Crore
Aditya Birla Nuvo, the diversified firm, has completed an extra 23% stake sale in Birla Sun Life Insurance Company, its life insurance firm, to Sun Life Financial, its Canadian joint venture partner for Rs.1,664 crore.
Aditya Birla Nuvo Ltd. in a BSE filing announced that it complete the transaction wherein Sun Life Financial has increased its stake in the life insurance joint venture Birla Sun Life Insurance from 26% to 49%. It also went on to say that ABNL has received an amount of Rs.1,664 crore from the stake sale. ABNL is expected to continue holding the majority of stake at 51%.
25th April 2016
RBI Increases FDI under Automatic Route in Insurance Sector
RBI has increased the FDI under automatic route in Insurance Sector from the current 26% to 49% stating that no Indian insurance company will allow any foreign company including foreign investors and portfolio investors to have an aggregate holding in the company exceeding 49%.
The earlier limit was 29% and the new 49% limit is subject to approval from the Insurance Regulatory and Development Authority of India. This will directly affect the 52 insurance companies in India of which 24 are life insurance companies and the remaining 28 companies are general insurance providers
4th April 2016
Pradhan Mantri Jan Dhan Yojana pay 452 claims
There have been 858 claims for the Rs. 1 lakh accidental insurance, and around 452 claims that have already been paid under the Pradhan Mantri Jan Dhan Yojana (PMJDY) scheme. There were only 26 claims pending due to incomplete documents, 380 claims were invalid. The number of claims filed stood at 2,298 for life insurance cover of Rs. 30,000 the claims and 297 were invalid and 1,976 claims were paid.
30th March 2016
Life Insurance industry says pension products share has dropped
The Insurance Regulatory and Development Authority of India or IRDA, has asked companies to provide guaranteed returns. However companies are finding this difficult since, pension products which are present in the life insurance industry are still in very small numbers. The portfolio of these products have dropped from 25% to 10%. Data has proved that any premium collection in relation to the pension products has seen a fall in collection lesser than Rs. 3, 000 crore in the last fiscal year, when compared to the Rs. 20,000 more that 5 years ago. To add to the already dropping collection, these products are facing huge competition from National Pension System (NPS) and have affected sales as well. The element of guarantee has made has made insurance products very different from the NPS scheme, however contrary to the NPS scheme, service tax is applicable on pension products.
Single premiums will get reduced service tax says Budget 2016
This year’s budget, has proposed for the service tax to be reduced on single premium annuity plans. The reduction is proposed to drop from 3.5% to 1.4% on single premium annuity plans. In cases wherein the amount is allocated towards investment or even savings for the policyholder. If this is not intimated to the policyholder at the service time, effective 1st April 2016. There is also a proposal that life insurance services which provide a way of annuity should come under the NPS which is regulated by the Pension Fund Regulatory and Development Authority (PFRDA) of India, which will be exempted from service tax with effect from 1st April, 2016.
Tax benefits on insurance to be linked to policy term and not sum assured
The upcoming budget session of 2016 is expected usher in a few much-needed reforms in the tax computation norms. It is also expected that the budget, in order to take into account the effect of inflation, will allow expansion of basic exemption limit from Rs.2.5 lakhs to Rs.3 lakhs per annum. One of the second most prominent expectation from the upcoming budget is the abolition of service tax for policies that have a sum assured of less than Rs.10 lakhs.
Also, it is expected that the pension plans will be made tax-exempt in the hands of the policyholder ones the maturity amount is reaped. This will fall inline with fostering long term savings and security in old age.
22nd February 2016
Rewards cap to be introduced by IRDA for insurance agents
The IRDA announced its intentions to introduce a rewards cap for insurance agents and intermediaries last month.
Insurance agents are to get 20% of the first year commission, and intermediaries are to receive 40%.
The move is motivate by the desire to create a level playing field across all segments for corporate and individual brokers, agents, and other intermediaries.
18th February 2016
New Financial Plan Aims at Creating Opportunities for All
Minister of State for Finance Jayant Sinha has said that the government’s proposed new financial architecture will create more opportunities for every citizen. The plan being developed will be implemented in three phases, and aims at providing financial security and income opportunities to every Indian.
The first phase of the Jan Dhan-Aadhaar-Mobile plan will focus on vision, the second on rolling out of simple financial products, and the third on enabling and ensuring financial access to people.
The plan combines the financial inclusion programme – Jan Dhan Yojana, the Aadhaar card and the uses of the mobile phone to optimise the financial system for the beneficiaries.
Mr. Sinha said the first phase has already been completed.
11th February 2016
4 million more enrolled by Telenor for their free life insurance scheme
Telenor in Uttar Pradesh, has enrolled over 4 million customer into their free life insurance scheme. The company has more than 11 million customers of which 4.1 million have taken up the free life insurance scheme. The scheme was launched in October of 2015 in association with another private life insurance company.
08th February 2016
First Year Collection for Life Insurer’s increases by 9.5%
The collection of premiums for the first year of life insurance by life insurance companies rose by 9.5% in December 2015 as compared to the previous year and stood at Rs 11,026.82 Crore. It was Rs 10,071.80 Crore in December 2014.
The first year insurance premium declined for private companies but witnessed an increase for LIC. For private insurance companies, the first year insurance premium fell by 12.1% to Rs 3703.15 Crore whereas the first year insurance premium for LIC rose by 25% to Rs 7323.67 Crore. The increase was a year on year increase.
Private insurance companies weren’t at a total loss either. Their new business premium saw a healthy growth of 17.5% and stood at Rs 25,972.31 Crore from the period of April to December 2015
31st January 2016
Private insurers in India underperform compared to other Asian markets.
According to a recent survey, the life insurance industry of India has underperformed compared to its Asian competitors. The report also reveals that the private insurance providers in India have not been successful is creating value. These private insurers are serving a tiny segment to meet their narrow investment requirements. Over the decade, the overall return of the private sector life insurance companies is much below than those of other Asian markets. It also fails to meet the cost of capital.
30th January 2016
Indian Insurance Sector Weaker Than Asian Counterparts: McKinsey Report
A report by McKinsey & Company said the performance of life insurance sector in India was weaker than its counterparts in other parts of Asia.
According to the report ‘The Life Journey India’, private insurance companies in the country are not taking full advantage of the market potential. The main reasons given for this are a small customer base and products catering to narrow investment needs.
The study, however, confirmed that within the narrow space of operations, the sector performs up to pace in India. This excellence was primarily due to extensive distribution channels and strategic partnerships, the report said.
It also said the sector in India was closely linked to the performance of the equity market, rather than an increase in the GDP.
28th January 2016
Indian insurance providers to receive investment from foreign investors
Following the launch of Insurance Laws (Amendment) Act in 2015, there is a rise on the limit of foreign ownership of insurance companies in India. The rate of investment has raised up to 49% form it previous rate of 26%. It is expected that it would open multiple opportunities foreign investments in India. Bharti Enterprise is the first company to reveal that its oversea partner AXA would increase it equity investments in general and life insurance up to 49%. AXA has already increased its stake in Bharti AXA General Insurance and Bharti AXA Life Insurance to 49% in December, 2015 after receiving official approvals from IRDAI and FIPB.
25th January 2016
16% growth in Life Insurance Premiums
Life Insurance providers witnessed a growth of 16% rise in the new insurance premiums between April- December 31st of 2015. Life insurers collected new premiums worth Rs.85,587.73 crore as compared to Rs.73,777.73 last year during the same period. Research data provided by the Insurance Regulatory and Development Authority of India showed that private life insurers posted a growth of 17.25% in new premiums.
21st January 2016
MoU signed by Corporation Bank and LIC for Group Credit Linked Insurance
Yesterday, in a top-level meeting between Corporation Bank and LIC, a special MoU was signed for a group credit linked insurance.
This particular linked insurance is aimed to cover loans of up to INR 4 lakhs. With an insurance term ranging from 5 years to 35 years, the loan will be covered by LIC India in case of the unfortunate demise of the borrower.
LIC has been maintaining the first position among channel partners in terms of mobilization of premium, registering year-on-year growth of 46% and that additionally improves the reliability of this insurance scheme. A premium amount of INR 500 crore will be advanced to LIC by Corporation Bank on or before March 31, 2016 to get this insurance scheme into action.
14th January 2016
Rs. 800 crore worth stake being sold by IDBI
IDBI is planning to sell their 20% stake in a life insurance joint venture, for a whopping Rs. 800 crore. The sale will now allow their foreign partner Ageas to increase their stake and help with adding weight to the state run capital. The joint venture currently stand with IDBI Bank holding a 48% share in the IDBI Federal Life Insurance, and the remaining is owned by Federal Bank and an European Insurer Ageas each holding a 26% share. The sale is expected to take place in January 2016, and is seen happening after the government raised the bar of foreign direct investment from 26% to 49%, increasing the foreign investments in domestic ventures.
2nd January 2016
Life insurance industry premium is up by 9%
From April – November, 2015, the life insurance industry reported at 9% increase in the annual premium mostly due to the volatile market conditions. The growth gas be supported by large private sector companies. Among the larger players, ICICI Prudential Life and Max Life has been more volatile and has reported decline in the individual business. HDFC continued to be a steady player and SBI remained in the higher growth trajectory.
28th December 2015
Group Life Insurance MoU signed between Dena Bank and SBI Life
Dena Bank recently signed a MoU with SBI Life Insurance to offer group life insurance solutions to its house loan customers. Titled the “Dena Grihaswami Suraksha Yojana”, housing loan borrowers would be entitled to an insurance cover at affordable premiums. This cover would protect against outstanding loan amounts, with SBI Life Insurance clearing the outstanding amount in the event of demise of insured. A single premium would be charged for the loan term, with borrowers expected to pay this when they enter the scheme. In the event of death claim exceeding the outstanding loan amount, the nominee will receive the excess amount.
19th December 2015
LocalOye to provide high life insurance cover to its partners
LocalOye, a startup offering services in over 250+ categories announced that it will provide life insurance cover worth over Rs.2 lakh for its top 100 service partners. This decision was taken to ensure that they feel secure when they are out to fulfil a service lead. The company is looking to providing life insurance plans for its performing service partners in three categories- Plumbers, electricians and carpenters in Mumbai, Bangalore and NCR. The startup is planning to provide the Pradhan Mantri Jeevan Jyoti Bima Yojana launched by the Prime Minister.
29th November 2015
Life Insurance Council plans database to prevent fraudulent claims
The Life Insurance Council, an apex industry body of life insurance companies, has decided to create a centralized database of insurance policies. This decision was taken in order to detect, identify, and prevent fraudulent claims. This fraud monitoring framework is expected to be ready by December, according to a statement issued by V. Manickam, secretary-general of the Life Insurance Council.
The proposed fraud monitoring mechanism will assist insurance companies with details of their customers and detect any fraudulent behaviour in disclosure and claims by policyholders. The Life Insurance Council is in the process of hiring a vendor who will provide the technology to build and maintain a common database. On this database, all the 24 insurance companies will be able to share their policy data.
29th October 2015
Initial Public Offer for HDFC Life may be halfway through 2016
HDFC the leading housing finance provider said they may go for a public listing for their life insurance subsidiary in 2016. The IPO will be done based on their joint venture with Standard Life and if the stake of the later hits at least 35%. Standard Life has made an announcement that they would increase their stake from the current 26% to 35%. Only after this transaction is complete will they know if they need an IPO. There is no possibility of an IPO will not happen in 2015 but may be in the middle of 2016.
28th October 2015
Annuity Plans Price Increases
The purchase price of annuity plans has increased, following a regulation issued by the Insurance Regulatory and Development Authority of India (IRDAI). At least Rs. 1,000, excluding bonus or profit, should be the minimum monthly payout. This move was introduced to ensure that policyholders receive a reasonable interest amount.
At present, there are no restrictions on the purchase price or the minimum payout amount. It may differ from company to company. In a statement issued, the IRDAI said that if the monthly payout is lower that Rs. 1,000 per month, the minimum purchase price will be increased. However, when the payout goes down, the rate of interest also decreases.
27th October 2015
Individual premium income drops for LIC in H1
Life Insurance Corporation, the country’s biggest life insurer, has seen a dip in the individual premiums incomes in the first half of the current fiscal year. For the same period last year the insurer collected Rs. 8,890 crore, however this year's collection dropped to Rs. 8,115 crore. The Insurance Regulatory and Development Authority (IRDA) data released has shown the decline in premiums incomes for LIC to be the sudden demand and sales of unit-linked insurance plans (ULIPs), also the private life insurance industry has shown a growth of 15% from last year’s Rs. 7,322 crore to this year’s Rs. 8,422 crore.
26th October 2015
Axis Bank will increase its stake in Max Life Insurance
The board of directors of Max India, have given Axis Bank the go ahead to increase their stake in Max Life Insurance Company. In the joint venture with the life insurance firm Axis Bank holds a 4% stake, the increase in stake will be a marginal one with the percentage still being less than 5%. Axis Bank is right now bancassurance partner, and they distribute Max Life Insurance Company’s products through their branches network. Currently there is no clarity on the method of the stake increase, if Max Life Insurance Company will issue fresh shares or the if the stake increase will be purchased from Max India is still under stipulation, as nothing is finalised yet.
26th October 2015
Life insurance industry records an 18.5 percent growth
The life insurance industry has recorded a growth of 18.5 percent in the first half of the fiscal year even as the largest insurer of the country has been growing less than 10 percent during the period. The insurance sector consists of 24 players that brought in Rs.58,286.40 crores new business. LIC recorded a growth of 9.2 percent during the first 6 months. LIC’s market share stood at 67 percent at the end of September. SBI Life earned Rs.2620.88 crore new business, HDFC life earned Rs.2624.26 crore new business whereas ICICI Prudential Life earned Rs.3,375.17 crore.
21st October 2015
India Post to sell life insurance policies
India Post is likely to offer various life insurance products as part of its long-term strategy to widen its range of offerings from fixed deposits and small savings to mobile wallets and a policy for girl child (sum assured of Rs.10 lakhs) which is on the cards. India Post will seek approval from the Insurance Regulatory and Development Authority (IRDA) soon to launch the additional insurance products.
The latest move is aimed at modernising the services of India Post which currently has around 1,60,000 post offices and 2,50,000 extra-departmental employees, who are expected to be trained as personnel financial advisers in villages.
India Post, under its insurance segment, currently has a corpus of Rs.56,000 crore, which includes rural postal life insurance (RPLI) and postal life insurance (PLI). India post aims for a 500% increase in the coming three years, according to sources in the department of post.
India Post which has so far sold 23 million under RPLI and 7 million policies under PLI plans to have tie-ups with some insurance companies to provide non-life insurance products.
India Post will also sell Atal Pension Yojana, launched by prime minister Narendra Modi in May 2015. According to reports, banks enrolled only 500,000 subscribers into the said scheme, which is primarily aimed at the unorganised sector. The finance ministry has urged banks to draw up strategies to widen the reach of Atal Pension Yojana to reach the set target of 20 million subscribers before December 31, 2015.
12th October 2015
HSBC Insurance plans to increase its stake in the Canara HSBC OBC Life
HSBC Insurance is considering raising their stake in Canara HSBC OBC Life from 26% to 49%. This is a 3 way joint venture, with currently 51% stake held by Canara Bank, 26% being held by HSBC Insurance and Oriental Bank of Commerce holding the remaining 23%.
7th October 2015
Rs.150 crore given to IndiaFirst Life as an additional capital infusion
Three of the promoters of IndiaFirst Life Insurance - Bank of Baroda, Andhra Bank and Legal & General, have provided the privately owned insurance company with Rs. 150 crore of capital infusion. This infusion has taken place as per the shareholding pattern Bank of Baroda 44%, Andhra Bank 30% and Legal & General 26 % stake. The MD and CEO of IndiaFirst Life Insurance said they are not looking at diluting their stakes and are committed for long term. With the new round of capital infusion IndiaFirst Life Insurance takes its total share capital to Rs 625 crore.
7th October 2015
IRDAI to mandate Public Listing for Large Life Insurance Companies
The Insurance Regulatory and Development Authority of India (IRDAI) is on the verge of making it compulsory for large life insurance companies to become publicly listed. As per IRDAI, any life insurer in business for the past 10 years needs to be publicly listed, as a measure towards increasing transparency in the functioning of the company. It will also allow others to share in the risk and return of the insurers, as opposed to everything being maintained between one or two partners. As per the regulator, life insurers with assets under management exceeding Rs. 60,000 crore will be the first ones who would be required to list initially.
Going by the benchmark of IRDAI, ICICI Prudential Life, SBI Life and HDFC Life are the top three insurers who would need to have a public listing initially. They are closely followed by Bajaj Allianz and Max Life insurance companies. Life Insurance Corporation, being a state-owned entity still falls under a grey area, but IRDAI can nevertheless direct the company with regards to its public issue.
15th September 2015
Life Insurance Companies Roped in Experian for Fraud Monitoring
In a bid to build a data repository and establish a fraud monitoring system, life insurance companies have roped in Experian, a global data analytics company to assist in the entire process. A similar plan by the Insurance Regulatory and Development Authority of India seems to be on the backburner for now.
The plan is projected to go live in October, allowing life insurance companies to cut back on their losses pertaining to false claims. As per Life insurance Council, the formalities to engage Experian for this project will be done by the end of this month. While the IRDAI is busy building an insurance information bureau for its members that is expected to complement the fraud monitoring network. With proper measures such as these, it is speculated that the comparatively lesser fraud cases faced by life insurers will be completely removed.
3rd September 2015
Life insurers to streamline timely pension payment
IRDA has directed the life insurers to streamline the process to ensure timely pension payment to the policyholders. The Insurance Regulatory and Development Authority of India has asked the life insurers to start communicating with the policyholder and check what option they have chosen for their pension.
The IRDAI circular said that the policyholders are opting for annuity options and the policyholders receive a lump sum amount which is given out as regular income for the rest of his life. It can be either immediate annuity or deferred annuity. Immediate annuity starts giving returns from the very first month whereas the deferred annuity starts giving payment after a certain period.
The circular will enable the policyholders to receive post-retirement benefits on time. The life insurers ought to know 6 months in advance the settlement that the policyholder chooses. This is initiated to ensure better corporate governance. If the policyholder has not indicated any particular option, then the life insurer can go as per the option mentioned in the form filled at the time of buying the product.
IRDAI has also told the insurers that they must provide an option to the policyholders to review their decision based on the latest information and select an annuity option that was not mentioned earlier.
11th August 2015
Insurance regulations are being reviewed by three new committees
The Insurance Regulatory and Development Authority of India (IRDAI) has recently formed three new committees to look into the current regulations in the life insurance, general insurance and reinsurance sectors in India. This is a move that has been required ever since the new Insurance Laws Amendment Bill had been passed by Lok Sabha on the 4th of March this year.
The current regulations in the three segments mentioned above are going to be thoroughly investigated to make way for reforms and changes in the existing regulations to stay updated with the new Bill, and provide excellent benefits to the people in general.
The first of the three committees, the life insurance committee, will look into current regulations and look for possible reforms in the areas of assets and liabilities, solvency margin, and appointed actuaries.
The second committee, which is the general insurance committee, will primarily look into the regulations and possible reforms primarily in the areas of claim reservation, reinsurance and appointed actuary.
The third and final committee – the reinsurance committee – will look primarily into possible reforms on current regulations in the registration of branches of foreign reinsurance companies, among other issues.
All three committees will have to submit their reports within one month to the Member-Actuary of the IRDAI for review.
27th July 2015
Life insurance industry’s premium collection grows by 24% in the current fiscal year.
The life insurance industry in India witnesses a growth of 24% in its total premium collections. Its total premium collection grows to Rs. 13,651 crore in the first two months of the present fiscal year, compared to its total business of Rs. 10,984 crore in the previous year. In the same period, the Life Insurance Corporation of India also makes a good recovery with 21% growth in its total premium mop-up at Rs. 9,384 crore. In the previous year, the corporation's business remained at Rs. 7,757 crore.
LIC’s business has also witnessed growth by 61% in the first two months of the fiscal year. There is a growth in LIC’s number of policies by 20% to 19, 71,713 in this year, compared to 16, 36,831 policies in the previous year. As a whole, the volume of business in group single premiums increased by 64 % to Rs. 7,694 crore in April-May from its previous amount of Rs. 4,683 crore.
15th July 2015
Fraud Monitoring System planned by Life Insurance Council of India
The Life Insurance Council of India is planning to get a fraud monitoring system in place by December 2015. This system would be effective for validating information pertaining to disclosure and claims of customers.
Banks get benefitted through CIBIL and this monitoring system will help insurance companies in a similar way. By verifying the authenticity of the provided information and claims, illegitimate instances of claims can be reduced. The council is already in the process of shortlisting a vendor who could collate the data required for this intended database.
In addition to this, there could be a possible waiver of the stamp duty and a 50% rebate in the re-insurance rate for the Prime Minister Jiban Jyoti Bima Yojana.
With 10 out of 24 insurance companies joining this initiative of the monitoring system, a week later could see major changes in the validation system of life insurance companies.
10th July 2015