Awaiting new norms, insurance cos favour Ulips
"Post charge cap in September 2010, our ULIP share for FY11 was at 86% and for FY12 it was 56% . For the current year, ULIP share stands at 55%. We would focus on maintaining the ratio at this level going forward,” said Amitabh Chaudhry, managing director and chief executive officer, HDFC Life.
Mayank Bathwal, chief financial officer and head institutional sales, Birla Sun Life Insurance pointed out that ULIPs contribute to 46% of total business at Birla Sun Life. Bathwal does not expect the ratio to change significantly in the next two or three years.
"However, this may alter in the medium to long term as the equity markets starts improving and customers look forward to investing in market linked savings instruments," he said.
In a previous interview, IDBI Federal Life had also indicated that they would look at increasing the ratio of their ULIP products. Out of its total business, ULIPs form only 30% for IDBI Federal, and traditional insurance constituted 70%.
Premium collections during the first half of the fiscal have fallen by 6% on a year-on-year basis for private insurers, to Rs 11,621.29 crore. When collections from LIC are added to this, the fall in Apr-Sep 2012 narrows to 4.2% annually.
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