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Life Insurance CompetitionProtecting the market share in metro areas, maintaining the brand image, aligning returns with market rates and adjusting to the regulatory environment are some of the biggest challenges before the Life Insurance Corporation, according to R. N. Bharadwaj, Chairman of the LIC. Lecturing members of the Confederation of Indian Industry on `Life insurance-competition and challenges', he said the insurance industry as a whole would have to meet the challenge of increasing insurance penetration and density by effectively tapping the rural markets and through micro-insurance. Competition has altered the market situation, bringing into focus lower margins and increased product options for customers and better services, he said. Citing the instance of unit-linked products, Mr. Bharadwaj said this was an instance of the change. He said LIC which was aiming at a 48 per cent expansion in first premium income this fiscal (against 42.5 per cent in 2003-04), intended to introduce six new policies, including unit-linked policies and policies aimed at women and children. While pension and group insurance were providing opportunities to every player, the vast and ever-expanding NRI market and the rural and unorganised sector were promising segments, he said. Elaborating on the alteration with regulatory environment, he said LIC was required to provide reserves for meeting the required solvency margin limits as per the Insurance Regulatory and Development Authority's (IRDA) regulations even for the business it had transacted in the past. It also had to train its immense agency network as part of an IRDA stipulation. On aligning returns with market rates, the chairman said in the falling interest regime it was necessary to monitor guaranteed returns on products. The compulsion before the industry was to innovate commodities and distribute
them through smart strategies for multi-channel networks while certifying
customer satisfaction, Mr. Bharadwaj said. For more information on this area visit our Life Insurance page. We recommend Loans UK if you're in need of a loan at the best rates imaginable. |
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