Reduced product portfolio may hit LIC’s premium income
Insurer facing difficulty in selling new products
SB Mainak, Managing Director, Life Insurance Corporation.
Kolkata, June 10:
Life Insurance Corporation of India (LIC) may see lower premium income in the first half of this fiscal on reduced product portfolio and problems related to selling new products.
Regulator’s nod
SB Mainak, Managing Director of LIC, told reporters on the sidelines of an event organised by the Bengal Chamber of Commerce and Industry that business may pick up after the insurer gets the nod from the regulator to sell new products.
The Insurance Regulatory and Development Authority (IRDA) has ordered the discontinuation of sale of old life insurance products from January 1 and insurers have been asked to come up with new products compliant with its revised guidelines.
LIC’s premium income started declining from January this year.
Mainak said the new regulatory compliant products are yet to get acceptance in the market.
“Field agents are finding it extremely difficult to sell new products,” Mainak said. A separate service tax charge which ate into the premiums and reduced the benefits, was one of the main reasons for the poor sale. The insurer, in the January-March quarter this year, saw new premium collection at Rs. 24,350 crore, 7.1 per cent lower than the Rs. 26,210 crore collected in the corresponding quarter last year.
“Since January, LIC and the industry as a whole have been witnessing negative growth,” he added.
LIC is expecting sales to pick up in the second half of this fiscal and plans to employ a new marketing strategy.
Marketing strategy
“We need to re-look at our marketing strategy for selling new products. It takes time to develop new products… We are expecting approval for some new products shortly,” Mainak added.
“We need to re-look at our marketing strategy for selling new products. It takes time to develop new products… We are expecting approval
for some of the
new products shortly”
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