 "LIC tops loyalty charts, but lead narrows")
The life insurance sector has seen an average growth of 13.8 per cent in the size of policies, to Rs 17,952 crore in the April to May period in this financial year, compared to Rs 15,774 crore in the same period of 2015, according to Life Insurance Council data.
Private life insurers had a higher average size than Life Insurance Corporation of India (LIC), a public sector company. The former’s was Rs 37,111 crore, growth of almost 11 per cent over a year.
Company executives said with more focus on traditional products, policy size could drop among large insurers. Life insurers sell products on both the traditional and unit-linked (Ulips) platform.
Ulips are also linked to equity markets and the average sizes are higher, though short-term volatility in the market can lead to investors getting jittery and rushing to surrender their products.
Manoranjan Sahoo, chief agency officer, Reliance Nippon Life Insurance, said insurers target an average size of Rs 30,000-40,000 crore for Ulips and Rs 25,000-30,000 crore for traditional products.
“At Reliance Nippon, since we predominantly sell traditional products, we plan to increase our average ticket size towards Rs 25,000 crore this year,” he added.
LIC posted an increase of 14.1 per cent at Rs 12,526 crore in its average premium policy. It predominantly sells traditional products to customers.
Sector experts said more customers were opting for traditional plans than Ulips, which could face volatility in the short term due to the markets reacting to global events like Brexit and general macro- economic indicators.
“Players who are strong in Ulips might see a decline in ticket size due to customers shifting preferences,” said a senior executive.
For the months of April and May, the first two of this financial year (2016-17), life insurers collected new premiums of Rs 18,583 crore, compared to Rs 13,651 crore in the same period of FY16. Private life insurers collected Rs 5,343 crore for April and May, compared to Rs 4,267 crore in the same period a year before. LIC collected Rs 13,240 crore in this period, up 41 per cent.
SNEAK PEEK AT THE MARKET TREND
Private life insurers had a higher average size than Life Insurance Corporation of India (LIC), a public sector company. The former’s was Rs 37,111 crore, growth of almost 11 per cent over a year.
Company executives said with more focus on traditional products, policy size could drop among large insurers. Life insurers sell products on both the traditional and unit-linked (Ulips) platform.
Ulips are also linked to equity markets and the average sizes are higher, though short-term volatility in the market can lead to investors getting jittery and rushing to surrender their products.
Manoranjan Sahoo, chief agency officer, Reliance Nippon Life Insurance, said insurers target an average size of Rs 30,000-40,000 crore for Ulips and Rs 25,000-30,000 crore for traditional products.
“At Reliance Nippon, since we predominantly sell traditional products, we plan to increase our average ticket size towards Rs 25,000 crore this year,” he added.
LIC posted an increase of 14.1 per cent at Rs 12,526 crore in its average premium policy. It predominantly sells traditional products to customers.
Sector experts said more customers were opting for traditional plans than Ulips, which could face volatility in the short term due to the markets reacting to global events like Brexit and general macro- economic indicators.
“Players who are strong in Ulips might see a decline in ticket size due to customers shifting preferences,” said a senior executive.
For the months of April and May, the first two of this financial year (2016-17), life insurers collected new premiums of Rs 18,583 crore, compared to Rs 13,651 crore in the same period of FY16. Private life insurers collected Rs 5,343 crore for April and May, compared to Rs 4,267 crore in the same period a year before. LIC collected Rs 13,240 crore in this period, up 41 per cent.
SNEAK PEEK AT THE MARKET TREND
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Private life insurers had a higher average size than LIC
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LIC posted an increase of 14.1 per cent of policy size at Rs 12,526 crore in its average premium policy
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Sector experts said more customers were opting for traditional plans
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For April and May, life insurers collected new premiums of Rs 18,583 cr, compared to Rs 13,651 cr in the same period of FY16
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Players who are strong in Ulips might see a decline in ticket size
- Policy size of large insurers could drop
