According to the annual report of Irda, major insurers like HDFC Standard Life, ICICI Prudential, SBI Life and Birla Sun Life have shown decline in premium income. For HDFC Standard life total premium from bancassurance has gone down by 12%. For ICICI Prudential, the decline has been 47%. SBI Lifes premium income from bancassurance channel has declined by 28%.
According to analysts apart from a challenging macro-economic scenario and regulatory changes after September 2010, a sense of apprehension was prevailing among both customers and distributors.
In the case of banks some other factors like slowdown in new customer acquisition and focus towards selling core banking products like CASA also impacted the sales potential for life insurance products, said Mayank Bathwal, CFO of Birla Sun Life.
A channel wise distribution pattern for the insurers reveals that bancassurance contributes to 64% of HDFC Standard Lifes premium earned for 2011-12. It contributes to 44% of SBI Lifes premium and 37% of ICICI Prudentials premium. Max life and Birla Sun Life earned 40% and 17% of their premiums respectively from the bancassurance channel.
Close to R1,900 crore was earned by HDFC Standard Life from the bancassurance channel.