We expect 20% growth in premium income YoY: Thomas Mathew T

Last Updated: Fri, Dec 07, 2012 07:41 hrs

pWhile the insurance sector is gearing up to produce better results in new business premiums the Life Insurance Corporation of India LIC is working aggressively to overshoot its premium targets and enhance its market share strongThomas Mathew Tstrong managing director tells emManojit Saha emand emM Saraswathy emabout the insurer&rsquos strategy and growth plans Edited excerptsppstrongGrowth in new business premiums NBP is in single digit this financial year What kind of growth do you see in LIC&rsquos NBP this financial yearstrongbr We have 81 per cent of the market share in terms of policies and 75 per cent in policies The other 23 private life insurance companies have a 19 per cent combined market share of policiesppThe next two quarters will be good for the industry and LIC because of the seasonality of the business About 60 per cent of the business for this year came from the last two two quarters alone LIC has filed for some new products which we expect to launch by early January Also there is a good sentiment in the economy and the stock market is looking up We have set a target of Rs 45000 crore premium for the current year in individual segment and want to sell 43 million policies We expect a 20 per cent growth in premium income year-on-yearppstrongSince the sentiment is good now would unit-linked plans Ulips be back in the industry and in your portfoliostrongbr During the heydays Ulips had gone up to 80-90 per cent of business for private life insurers It has now come down Insurers are focusing on non-Ulip long-term non-single premium product We have always been concentrating on traditional products so we were not affectedppThanks to the good market sentiment once Ulips come back to the market it should pick up Not to those high levels but in terms of what is required for the marketppstrongLIC has made a comeback from the pre-2008 levels where it was losing market share to private players&hellipstrongbr We have come back very aggressively In fact our market share had gone down to 60 per cent We have steadily increased it to 81 per cent It will still go upppWe have launched Vision 2020 where we want that by 2020 every insurable person has a policy in hisher pocket For this we are gearing up and taking steps in areas like technology marketing and re-engineeringppstrongSince service tax has been a major issue for LIC and others would you recommend some concessions on this from the Union Budget strongbr We have asked for some concessions in the service tax regime and tax incentives for health and pension segments The future of the insurance industry is pension and health In India insurance penetration as a per cent of GDP is only 41 In advanced nations it is 11-12 per cent So there is huge potential Insurance density in our country is 59 whereas in advanced nations it is 3000 The regulator should be supportive to develop the industryppstrongOnline sale is fast becoming a buzzword Is LIC comfortable going online with its productsstrongbr Online sale would require a social security number advanced technology and digital identity of the person Insurance is not like selling a commodity It requires documentation and digital signature Today these are not available in IndiappWe are selling our Jeevan Akshay pension product online but only in a small way Private companies are selling term plans online We are also coming up with it however it will not come up in a big way unless the infrastructure is in place We still have wet signatures the use of a pen to sign documents by hand being used and the process in most cases is not fully onlineppIn the next fiscal we will be out with a lot of plans online LIC is developing infrastructure for that to target the young segment When we go online there is a cost advantage which can be passed on to the customersppstrongHow has been the performance of micro-insurance productsstrongbr We have three micro products We have set a target of 45 million for micro-insurance policies but we hope to touch five million Last year it was 38 million Presently we have more than 10 million micro-insurance policiesppFurther we cover some villages under the Madhur Bima Gram plan which gives incentives to the village panchayat for achieving a target in terms of policies Last year we covered 400 villages under the scheme this year we want to do 1000 villagesp

More from Sify: