Kotak Life to focus on mass market

Kotak Old Mutual Life Insurance Company has decided to focus on the mass market as it witnessed a 100 per cent growth in first year premium income from individual regular premium policies. Kotak Life was primarily into selling single premium products till recently.

Of the total premium income of Rs 650 crore in 2005-06, the first year premium income from regular policies was Rs 349 crore against Rs 174 crore in 2004-05.

"Our composition of business has changed. Our focus is now on individual regular premium policies moving away from single premium policies. Our single premium policies have shrunk to Rs 33 crore (in 2005-06) from Rs 189 crore (in 2004-05," said Gaurang Shah, managing director, Kotak Life Insurance.

The company plans to double its premium income in 2006-07 by strengthening the distribution network and launching new children and pension plans. Kotak Life will increase its agents base to 25,000 from the current 12,000, Shah said.

"We had our campaign on safety net that was valued by customers. We offer capital guarantee on all unit linked policies. Our returns on guarantee plan are the best in the guarantee space, said Shah. Kotak Life also saw the share of ULIPs in total business increasing to 85 per cent at the end of March 2006, against 65 per cent a year ago. Kotak Life's assets under management totalled Rs 1,050 crore.

Kotak Mahindra Bank is Kotak Life's key bancassurance partner. The bank contributed Rs 150 crore to premium income from regular premium policies in 2005-06.

Apart from continuing to launching capital guarantee products, Kotak Life is also evaluating entry into the health insurance market.