Insurance sector to benefit from any hike in invstmt limit: AIG

Exemption limit for individuals under 80C is expected to be hiked by the govt from Rs 1 lakh to Rs 2 lakh

The reported proposal to double the exemption limit for investments by individuals to Rs 2 lakh in the forthcoming budget will accelerate growth in the insurance sector and also give some relief to the people, a top Tata AIG General Insurance official said today.

"Since insurance is linked to the economy, giving boost to household savings would provide some relief to the people and I am hopeful of accelerated growth in the insurance sector, due to this proposal", K K Mishra, Managing Director and Chief Executive Officer, Tata AIG General Insurance, told reporters here.

Mishra, here to inaugurate the expanded branch office, said that the company was focusing on health insurance for individuals, the emerging segment, and making efforts to bring some more critical illness into insurance fold.

The company was not averse to the idea of group insurance, but the premium should be right and profitable as this was where the market was losing, he said, adding,health insurance contributed 20% to the total business of the company.

Tata AIG was expecting a business of Rs 3,030 crore in 2014-15 as against Rs 2,456 crore in 2012-13, an increase of 20%, he said.

When asked about crop insurance, Mishra said there were some issues with regard to the implementation of a new scheme, since many, including the farming community, preferred continuation of old scheme.

"However, we have no no issue and are ready to stay in the segment", he said.

The company has already launched the cyber crime policy and is targeting commercial institutions and signed agreement with two big financial institutions, he said.

Mishra said the company's new premium rose 12% last year and projected a 20-22% increase this fiscal. Travel insurance contributed about 10% of the total business, while four% business was done online, he added.