Great days ahead
05 January 2006
Life Insurance Council secretary general S V Mony tells Venkatachari Jagannathan in an interview that great days are ahead for the insurance industry
The Insurance Regulatory and Development Authority (IRDA) urgently needs more qualified staff, says Life Insurance Council secretary general S V Mony, as the regulator has a lot of important work to do. The council is in the process of preparing a code of conduct for life insurers, in the wake of widespread market malpractice in selling Keyman insurance policy. IRDA had to intervene to set right the situation. "That apart, the government should encourage life insurance through suitable tax incentives," he says.
Excerpts from an interview:
Looking back over five years of liberalisation, what is the performance of the private players in the life insurance industry?
The market has grown at a CAGR of over 30 per cent in terms of new business premium. The new players have set very high standards of customer care and responsiveness. A fair part of the credit for this must be given to the thoughtful manner in which customer service regulations have been framed by the regulator. These five years have seen the introduction of new and innovative products, including unit linked insurance policies (ULIP).
The basic need for insurance protection at minimum cost is well met by suitably structured 'term' and 'whole life' insurance products. These were sold minimally earlier; now they are widely marketed. This results in real penetration. Distribution through bank channels, new riders for life insurance cover, etc, are good examples of positive changes in the market in these five years.