Ulip renewals take the lead.

The economic downturn might have affected the sale of new policies, but it has not prompted individuals from renewing their life covers.

Also Read   Related Stories News Now - 'The current crop will be much better' - India Eco Summit: Global M&A to see an upswing: Deloitte - Honda Q2 profit plunges 56% - Now, pay risk premium at will - Right time for India to acquire assets in Kazakh: Sajjanhar - Machine tool makers de-risk their business

Also Read   Related Stories News Now - Markets end on a strong note - Nabard FY14 operating surplus soars 28% to Rs 1,635 cr - RBI eases banks' term deposit restrictions - NMDC Q4 net down 21.74% to Rs 1,642.28 cr - Balrampur Chini Q4 profit up by 15% More

The total premium income, which includes renewals and fresh sales, rose 16.6 per cent to Rs 101,500 crore during the period from Rs 87,047 crore a year ago. An increased focus by insurers on renewals has helped increase the flow of funds. Besides, executives at these companies said policyholders have become aware of the long-term nature of Ulips and are not surrendering policies mid-way.

“We are making every effort to improve our renewal premium. We have set up a different vertical to focus on this area, which got operational this year,” said HDFC Standard Life Chief Financial Officer Vibha Padalkar.

Policyholders have continued to put money in Ulips since stock market continued to move up after the election results were declared.

“There is a clear shift in priorities of insurance companies. They have started focusing on persistency as the cost of acquiring a new customer is more than retaining the existing one,” said IDBI Fortis Managing Director and Chief Executive Officer GV Nageswara Rao.

Renewal premium for non-linked products rose 10.2 per cent to Rs 36,996 crore during the first half, as against Rs 33,582 crore a year ago.

Last December, the Insurance Regulatory and Development Authority (Irda) had put a minimum cap of 75 per cent on renewal premium for Ulips that were effective from April 2009. For instance, if a policyholder pays Rs 10,000 in the first year, he has to pay at least Rs 7,500 in the second year. This has helped insurance companies collect higher renewal premium.

New Ipad Application :Business Standard's all new IPad App Click here to download for free Other Stories      - Markets end on a strong note - Nabard FY14 operating surplus soars 28% to Rs 1,635 cr - RBI eases banks' term deposit restrictions - NMDC Q4 net down 21.74% to Rs 1,642.28 cr - Balrampur Chini Q4 profit up by 15%

Tags : economic downturn | Ulips | life covers | IDBI Fortis | GV Nageswara Rao | Irda   Read Business news in  Advertisements -  Benefits Upto Rs. 2.36 Lakhs on the Fully Loaded TJet Petrol. -  Journey on, We are by Your Side. Click here to know more -  Help a Child Achieve her. Click to know more -  2 Lac Apartments, 1 Lac House / Plots. Click here -  Benefits Upto Rs. 2.36 Lakhs on the Fully Loaded TJet Petrol. -  Watch The Film Here. Click here to know more.. -  Leader in Passenger Car & Automobile Tyres. Click here -  1 billion in saving for Unilever without any tangles. -  Learn How One City is Running on FOOD SCRAPS. -  One Partnership Endless Possibilities. Click here to know more -  Helping doctors detect diseases earlier, saving costs & extending lives. -  36 Lakhs can get you a pool of Luxuries. Click here -  Which is the best plan for your daughter -  Check out the TRUE COLOURS of your Stocks, Now for FREE! -  One of the leading business schools in the world.Know More