Expert Zone

Straight from the Specialists

Pension plans are making a comeback

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(Any opinions expressed here are those of the author and not of Reuters)

Life insurance companies had all but exited the pension sector after tough regulations were put in place to guarantee returns for the investor. This is a vital sector for insurance companies and hit overall business.

In 2010/11, new business of 122 billion rupees was added in the pension sector. This fell to 111.7 billion rupees in the following fiscal year. Worse, deletions in the business increased from 68.9 billion rupees to 195.2 billion rupees last year — surely that would have hurt.

So why did insurance companies drop this huge business opportunity? The sticking point seemed to be the regulation which mandated a guaranteed non-zero rate of return on investments made till the date of vesting.

This guaranteed return was earlier mandated at 4.5 percent by the regulator but was diluted to non-zero returns when it was found to have no takers.

Why online is the right way forward in life insurance

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(The views expressed in this column are the author’s own and do not represent those of Reuters)

Insurance in India is divided into two broad categories — life insurance and non-life insurance (also called general insurance). For the record, most retail non-life products such as health insurance, car insurance and travel insurance are already sold completely online by most insurers.

Life insurance still struggling, non-life continues to grow

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(The views expressed in this column are the author’s own and do not represent those of Reuters)

The lean half of the financial year for insurance sales is behind us and the numbers for the life insurance vertical are not impressive. But the general insurance or non-life vertical has shown a healthy growth rate. Highlights are given below.

Private life insurance companies still struggling

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(The views expressed in this column are the author’s own and do not represent those of Reuters)

The Life Insurance Corporation of India (LIC) has again come to the rescue of the industry in the financial year ending July 2012. While 23 private players together have a marginal dip in business (-1 pct), LIC has powered ahead with 23 pct growth in new business premium collection.

Life insurance business remains almost stagnant

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(The views expressed in this column are the author’s own and do not represent those of Reuters)

The life insurance industry in India is still struggling on the growth front while the general insurance industry seems to be doing well. The life insurance industry grew by a marginal 1.4 pct while the general insurance industry grew by 18.3 pct. This is based on data released by Insurance Regulatory and Development Authority (IRDA) for the first two months of the financial year.

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