New surrender value norms: Life insurers turn to policies with high value

Despite the fall in number of policies, the new business premiums of life insurers grew in double digits

Life insurers shifted their focus to selling high-value policies in October as the transition to new surrender value norms, effective October 1, limited their ability to roll out all products in their portfolio. This had led to a 40 per cent year-on-year (Y-o-Y) drop in the number of policies sold in October.

 

Additionally, distributors had engaged in a fire sale of policies in September due to uncertainty about the impact of the new norms on their commission structures. This advance selling made an impact in October, as distributors slowed down on promoting new products.

 

Data from the Life Insurance Council