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: Deepak Satwalekar, a well known financial personality in the country, retired as the managing director and CEO of the HDFC Standard Life Insurance last week. He spoke with FE's Kumud Das about the future trends in the liberalised life industry. Excerpts
How do you see the life insurance industry today?
The life insurance industry today is growing little slower than what was it has been growing for the last five years. But of all the financial sub-sectors it seems to be offering stability to the sectors.
It has not suffered large redemption pressures unlike mutual funds and there is no greater loss. The growth is not over 100% like it was last year. In the first half of the current fiscal, we had a growth of about 50% over the previous year. So, we are seeing those business strengths coming in. People are looking for long-term savings. A large number of contracts are for a period of 20-25 year range and a lot of younger people are now buying policies from us.
Don't you think that unit linked insurance plans (Ulips), and not risk products, has solely contributed to the growth of the life insurance industry?
I think it is one of the biggest confusion, which has been created by the media. I don't think that the media understands that the insurance is not just about risk product and protection.
Ulips are there to help you plan your financial security. Ulips also offer you protection. The combination of savings and protection is what every individual has to meet. I am not willing to understand and accept that Ulips are not insurance products. If you look at the developed market, may be UK as well, the same products account for over 90% of insurance sales.
How do you see the appetite for Ulips after the recent stock market crashes?
We continue to see a huge request for ULIPS as over 90% of our total sales are Ulips. If the same trend continues, over 60-65% of the new premium that we get is targeted at our equity funds, which is about the right thing to do. Because if the market is at its low levels, then you enter the market at this level and over a 20-25 year period, you will see a huge appreciation in the value. So, Ulips also provide you the ability to participate in the stock market...
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