The number of products of life insurance companies has seen a jump of 12.3 per cent as of October 31, 2016, according to data from Life Insurance Council. The industry had 685 products as on October end 2016 compared to 610 products last year during the same time period. For the private sector, the number of products rose to 650 compared to 579 a year ago. Life Insurance Corporation of India (LIC)'s number of products rose to 35 from 31 in the same period.
Individual products of life insurers saw a faster rate of growth. The industry has 518 products for the individual/retail segment as of October 2016 compared to 451 products as of October 2015. With respect to the group segment, the number of products rose marginally to 167 compared to 159 a year ago. LIC has 23 individual and 12 group products as of October-end 2016 compared to 20 individual and 11 group products.
Private sector companies, on the other hand, had 495 individual products and 155 group products in October end 2016 that rose from 431 and 148 respectively from a year ago. Overall, industry players said that the approval process from the regulatory side has speeded up compared to earlier times when products were stuck at the regulator's office for a longer duration.
Further, now that clarity has been given by new norms that have asked life insurers to have only five products a year that can be filed with the regulator. While the Insurance Regulatory Development Authority of India (IRDAI) did not bar companies from filing more products, it had said that said if the number of products exceeds five, the insurer should furnish supporting market research, product-wise persistency for the 13th month, 25th month and 37th month as on April 30 of the previous year.
Hence, insurers have been asked to bring out an as come out with a new product planner rule, by which an insurance company can file only five products for approval in a year. However, Life Insurance Corporation of India (LIC), the country's largest product planner before every financial year. The planner would give an indication of the number of products an insurer proposes to file each quarter.