M R Kumar, chairman, Life Insurance Corporation (LIC), said the company was currently growing at 18% and would likely grow at 20% in terms of the number of policies, to reach 2.5 crore policies by the end of March 31, 2020. LIC wants to maintain the profit of Rs 21,000 core it had made last year from investments in the equity market and hopes to, at least, reach Rs 22,000 crore this year, he said.
LIC had sold around 2 crore policies in the last five years, he said. In the current year, the Indian life insurance business reported a new business premium of Rs 1.69 lakh crore of which LIC had garnered about Rs 1.2 lakh crore.
The company has expanded its agent network. LIC has 11 lakh agents, of which five to six lakh are millennials. So, the company has been deploying millennial employees to sell its products to millennials. There was a net increase of 1 lakh agents last year. Almost 30,000 chief life insurance advisers were engaged to recruit agents. Among banks, IDBI was leading in terms of bancassurance tie-ups with LIC, and the bank has brought Rs 500 crore in premium this year, Kumar said on the sidelines of a seminar at the National Insurance Academy (NIA) in Pune on Friday.
The chairman said LIC would be looking at unit-linked policies where the need for solvency does not arise to deal with potential stress in the insurance market and to improve solvency. They had filed a couple of products with the regulator and was hoping to come up with some new ones in the next financial year, Kumar said. He said LIC’s products are being re-designed but will not have much changes. The company designs its policies focused on customers. Irdai has mandated suitability clause to explain to customers why a particular product is right for them and all these will be documented. Only four to five products that do not require to be re-designed include Jeevan Shanti Pension, Jeevan Arogya Cancer Cover.
Kumar was in Pune to deliver key note address at the 21st Annual C D Deshmukh Memorial Seminar organised by NIA on the role of the life insurance industry in a $5-trillion economy. India would have to double its economic growth to reach $5- trillion economy and the insurance sector growth need to be higher than the growth of India’s GDP. The contribution of life insurance number could be around $1 trillion, he said. Kumar said there were 24 insurers in the life insurance business that covers only 17% of the population.