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SBI, Reliance Witnessed Steep Fall In Life Insurance Premium

Posted on May 2, 2013 by Akanksha

The life insurance industry witnessed a drop of 6% in premium collection during the financial year 2012-13, with large private sector life insurers like SBI Life and Reliance Life recording a steep fall in premium income.

The total premium collection by 24 life insurers during FY’13 stood at Rs 1, 07,011 crores, and a decline of 6% over the same period last year.

Among the private sector life insurance companies with premium income of over Rs 1,000 crores, SBI Life’s premium collection fell by 20% to Rs 5,184 crores during FY’13. Reliance Life saw its premium income dip to Rs 1,376.58 crores during the fiscal, down by 23.92%.

Country’s largest life insurer, Life Insurance Corporation of India (LIC) reported a 6.4% drop in its premium collection to Rs 76,246 crores in FY’13 as against Rs 81,515 crores in FY’12.

Among other major private players –ICICI Prudential Life and Birla Sun Life saw premium income dropping by 5.2% and 4.6%, respectively.

However, HDFC Life and Bajaj Allianz Life bucked the industry trend registering a growth of 15.7% and 10.2%, respectively.

ICICI Prudential collected a premium of Rs 4,809 crores, followed by HDFC Life at Rs 4,435 crores and Bajaj Allianz Life at Rs 2,292 crores, during financial year 2012-13.

Another private sector life insurer, Max Life, saw a meager 0.4% drop in premium income at Rs 1,899 crores.

Private sector life insurers together netted Rs 30,765 crores in FY’13 as against Rs 32,718 crores in FY’12, a decline of 6.3%.

Reliance Life Eyes Expansion In Health Insurance Space

Posted on April 23, 2013 by Akanksha

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Looking to tap the low customer penetration in health insurance segment, leading private insurer Reliance Life Insurance is planning to strengthen its presence in pure health insurance space with an expanded product suite.

Health insurance is mostly dominated by general insurance companies at present, but life insurance firms have started offering health-focused products of late.

Reliance Life, a part of Anil Ambani led Reliance group’s financial services firm Reliance Capital, has also launched two new health products –Reliance Life Care for You Advantage Plan and Reliance Life Easy Care Fixed Benefit Plan.

Health insurance penetration in India is as low as 5%, with over 85% of the 1.4 billion populations having no health cover. Hence, the company see health insurance segment as an opportunity to serve all requirements of customers and their families in short, medium and long term.

The company currently has three health products in its portfolio. Going forward, Reliance Life insurance has plans to further strengthen presence in pure health insurance space.

The recently passed new health insurance regulations specified the critical illnesses to be covered and standardized definitions have propelled life insurers to turn their attention towards the health insurance segment.

On an average, life insurers have two to three per cent of their business coming from health insurance in the retail segment and have a huge growth opportunity as the health market is highly untapped.

Categories: News | Tags: Health Insurance, Reliance Life, Reliance Life Care for You Advantage, Reliance Life Easy Care Fixed Benefit Plan

Reliance Life Launched New Health Care Plan

Posted on March 21, 2013 by Akanksha

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Private insurer, Reliance Life Insurance Company has launched a health insurance plan named ‘Reliance Life Care for You Advantage Plan’. The plan is a family floater scheme.

The plan offers comprehensive coverage for hospitalization, surgeries and critical illnesses for the entire family in a single policy.

The key feature of the policy is that it allows an insured to pay a fix premium for a three-year policy. The premium remains fixed for the three-year period, irrespective of the number of claims taken by the insured during the validity of the policy.

The plan offers the insured a cover that includes primary member, spouse, children, as well as parents and parents-in laws.

Reliance Life insurance is a part of Anil Ambani-led Reliance Group’s financial services arm, Reliance Capital.

Categories: News | Tags: Health Insurance, Reliance Life, Reliance Life Care for You Advantage

LIC Selected as Default NPS Annuity Service Provider

Posted on March 4, 2013 by Akanksha

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Pension Fund Regulatory and Development Authority (PFRDA) has chosen state-owned Life Insurance Corporation of India (LIC) as default annuity service provider for subscribers exiting from New Pension System (NPS) and seeking withdrawal of accumulated pension wealth. It will be applicable for all variants of NPS.

PFRDA has empanelled seven Annuity Service Providers (ASPs) for providing annuity services to NPS subscribers.

While subscribers are required to select an empanelled ASP along with an annuity scheme from those offered by the chosen ASP at the time of exiting from NPS, PFRDA has now decided to assist subscribers by providing a default option.

The default scheme offers annuity – a policy by an insurer designed to provide payments to the holder at specified intervals- for life with a provision of 100% of the annuity payable to spouse during her-his life on death of annuitant.

Besides LIC, other ASPs include SBI Life, ICICI Prudential Life, Bajaj Allianz Life, Star Union Dai-Ichi Life and Reliance Life.

Under the provisions of NPS, a maximum of 60% of corpus accumulated at the time of exit, which is normally on the attainment of 60 years of age, can be withdrawn but a minimum 40% of corpus has to be utilized for purchasing an annuity from one of the empanelled ASPs.

The NPS was introduced for the new recruits who joined government service on or after first January 2004. From May 2009, the NPS was opened up for all citizens in India to join on a voluntary basis.

At the end of 2012, over 42 lakh subscriptions were enrolled with a corpus of over Rs 26,000 crores.

Categories: News | Tags: Annuity Service Providers, APS, Bajaj Allianz Life, ICICI Prudential Life, LIC, New Pension System, NPS, Pension Fund Regulatory and Development Authority, PFRDA, Reliance Life, SBI Life, Star Union Dai-ichi Life, Subscriptions

Insurers Served Show-Cause Notices for Tax Violation

Posted on December 14, 2012 by Akanksha

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The revenue department has served show-cause notice to eight private insurance companies for alleged tax violation. The eight private insurance companies are Reliance Life, Sahara India Life, DLF Pramerica Life, Aviva Life, Sri Ram Life, Iffco Tokio General Insurance, Apollo Munich and Bharat Reinsurance.

Out of the eight insurance companies Reliance Life, DLF Pramerica Life, Iffco Tokio General Insurance and Bharat Reinsurance have submitted their replies to the government.

In cases where companies have submitted the reply, a personal hearing will be held and adjudication orders will be passed.

In cases wherein reply is yet to be submitted, the personal hearings will be conducted after insurance companies will submit their replies.

Categories: News | Tags: DLF Pramerica, Reliance Life, Tax Violation

Reliance Life Bets Big on Health, Pension Plans

Posted on December 12, 2012 by Akanksha

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Private insurer, Reliance Life Insurance, as a part of its business strategy to drive growth is enhancing its presence in health and pension segments with new products and services.

Reliance Life has filed two products in health and two in annuity categories with Insurance Regulatory and Development Authority (IRDA) for its approval. And company will launch all four products as soon as it gets IRDA’s approval.

Company has filed two health products, of it, one is reimbursement plan and another is simple fixed benefit plan. At present company has lone pure reimbursement health insurance plan –Reliance Life Care For You Plan- for individuals and family members.

As per the company two new health insurance plans will strengthen its health insurance portfolio and will help to consolidate its position in the life insurance space among life insurers.

Company is aiming to increase the share of its health portfolio to 5% in next two years from current one percent.

Reliance Life is a part of Anil Ambani led Reliance Group’s financial services arm Reliance Capital.

Categories: News | Tags: Health Insurance, Pension Plans, Reliance Life

Reliance Life Launched ‘Face-to-Face’ Distribution Channel

Posted on November 22, 2012 by Akanksha

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Private insurer, Reliance Life insurance has launched ‘Face-to-Face’ distribution channel. This new distribution channel is aimed at servicing customers whose agents have become inactive. For this new distribution channel Reliance Life has hired around 200 women employee advisors in seven cities during the pilot phase and it is planning to scale-up recruitment across the country in next few months.

This distribution channel will service company’s orphan policies and provide post-sales service to policyholders.

Life insurance policies get ‘orphaned’ when the distributor discontinued his agency or his services are terminated by the insurer. In such cases, the responsibility of servicing these policies is transferred to an active agent, who stands to earn commission on the renewal premiums.

The new distribution channel would operate with Life Planning Officers (LPOs) who would primarily be women employees, with housewives being one of the key target segments for recruitment.

Women will be trained to service orphan policies, develop a relationship and then cross-sell to existing customers and build their network through references.

The new sales format will focus on Tier I and Tier II cities and leverage the talent pool amongst on housewives in these locations to connect with the customers and support the company’s existing distribution channels.

Apart from providing post-sales services, LPOs will also collect information related to current policies for data purification and family information and details of life events to enrich their database and help customers in reviving lapsed policies.

The main aim of this distribution format is to target existing customers who are currently not connected to any advisor and distributor.

Company is hoping that this sales-cum-service initiative will not only help to retain its existing customers but also help it to enhance relationship value through cross-sell and up-sell to existing policyholders.

Reliance Life insurance is a part of Anil Ambani-led Reliance Group’s financial services arm, Reliance Capital.

Categories: News | Tags: Distribution Channel, Life Planning Officers, Reliance Life

Private Life Insurers Witnessed Fall in Premium Collection by Individual Agents

Posted on November 15, 2012 by Akanksha

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Private life insurance companies have witnessed a fall of 13.7% in first half of financial year 2012-13 in new business premium mainly on account of sharp decline in premium collection from individual agents.

An analysis of five large private life insurers has revealed that they collectively witnessed sharp decline in new business premium collection by individual agents in the April-September 2012 period. Premium collection by these life insurers from individual agents for April-September 2012 stood at Rs 1,763.47 crores as against Rs 2,229.28 crores in corresponding period last year, a fall of 21%.

As a proportion of total premium collection, individual agents managed 41.4% in April-September 2012 period compared with 45.9% in the same period last year.

The life insurers that were considered for this analysis are ICICI Prudential Life, HDFC Standard Life, SBI Life, Bajaj Allianz Life and Reliance Life.

Premium collection by corporate agents has also come down. Premium collection by corporate agents for April-September 2012 period stood at Rs 2,008.68 crores as against Rs 2,219.99 crores in the same period previous year, a decline of 9.5%. However, as a proportion of total premium collection, corporate agents witnessed a growth from 45.7% in April-September 2011 period to 47.2% in April-September 2012 period.

As the industry has shown overall negative growth, distribution channels like individual and corporate agents, has been significantly impacted. Banks and brokers have performed reasonably well.

Reliance Life witnessed the steepest fall of 31.5% in premium collection by individual agents. Reliance Life’s premium collection by individual agents for April-September 2012 stood at Rs 262.77 crores as against Rs 383.48 crores in corresponding period last year.

SBI Life’s premium collection by individual agents for April-September 2012 stood at Rs 459 crores compared with Rs 658 crores in the same period last year, a decline of 30.2%.

Bajaj Allianz Life was the only insurer to witness a growth in premium collection by individual agents. Its premium collection by individual agents for April-September 2012 stood at 395 crores as against Rs 380 crores in corresponding period last year, a growth of 4%.

Premium collection of Bajaj Allianz Life by corporate agents for April-September 2012 stood at Rs 113 crores compared with Rs 248 crores in the same period last year, decline of 54.4%.

Premium collection of SBI Life by corporate agents for April-September 2012 stood at Rs 317 crores compared with Rs 626 crores in corresponding period last year, a decline of 49.4%.

However, ICICI Prudential Life saw a rise in premium collection by corporate agents. Its premium collection by corporate agents for April-September 2012 stood at Rs 656 crores as against Rs 435.2 crores, a growth of 50.7%.

During April-September 2012, HDFC Standard Life’s premium collection by corporate agents stood at Rs 834 crores as against Rs 808 crores, a growth of 3.2%.

Premium collected by brokers, who are allowed to sell policies of multiple insurers, grew by 6.1%. However, their contribution to total premium remained as low as 6%.

Categories: News | Tags: Bajaj Allianz Life Insurance, Corporate Agents, HDFC Standard Life, ICICI Prudential, Individual Agents, New Business Premium, Private Life Insurers, Reliance Life, SBI Life

Reliance Life Introduced Two First-Of-Its Kind Initiatives

Posted on October 25, 2012 by Akanksha

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Taking cue from its Japanese partner -Nippon Life-, Reliance Life has started to new initiatives which are first-of-its kind in the country. Company believes that these two initiatives will help in building healthy relationship with its customers and expand and strengthen its existing distribution channels in order to increase its reach.

Company is hoping that these initiatives will replicate the success that they enjoy in Japan.

Life Plaza

Reliance Life has launched new distribution channel by the name ‘Life Plaza’, aimed at creating awareness about life insurance in different locations and creating pool for life insurance products.

Reliance Life is the first company in the country to set up a structured need-based in-branch sales platform in the form of ‘Life Plaza’. Reliance Life Plazas will promote need-based sales, fill service gaps and also offer financial value-added services such as tax and financial planning, Aadhar card registration, PAN card generation, health check-ups and nutrition counseling.

Company believes that this unique distribution model will help it to reach out to customers, understand their needs and provide solutions to them at the venue. Company says that this process of selling will ensure that customer buys what he needs and understand and thus, it will also address the problem of mis-selling.

Company is planning to set up 200 Life Plazas across the country in the current financial year. Company is also planning to hire around 1,000 people under this new distribution channel within current fiscal. For setting up of Life Plazas and recruitment, company will focus on tier II, tier III and tier IV cities.

All Life Plazas will be managed by Reliance Life’s employees, who will handle customer’s queries and process the documentation instantly at the venue, with a view to tap the new customers and service the existing policyholders.

Apart from addressing walk-in customers, the company will also proactively invite customers to the Life Plazas for presentations on the benefit of investment in various financial products, importance of insurance as a life protection tool and Reliance Life’s wide range of products and services.

Reliance Life Plus Club

Reliance Life has begun its post-sales services drive across the country under its ‘Reliance Life Plus Club’ initiative. Reliance Life is the first company in the country to introduce structured post-sales customer service platform.

This initiative is inspired by ‘Zutto Motto’ (forever for service) service at Nippon Life insurance in Japan.

Under this initiative, the company has asked its 1.5 lakh representatives, including staff, advisors and channel partners to meet around 10 % or over one million of its existing customers by the end of current fiscal for services beyond premium collection. At present, Reliance Life has more than nine million policyholders. Company has instructed its 1,200 branches across the country to implement it like sales targets.

The company has made a rule for its entire sales people that they should visit every customer periodically at least once a year. Such visits help in selling new products to existing customers and acquiring new clients.

The company will spend about Rs 12 crores in the current financial year for this initiative.

Reliance Life is 74:26 joint venture between Reliance Capital, a financial services arm of Anil Ambani led Reliance group and Japan based Nippon Life.

Categories: News | Tags: Life Plaza, Reliance Life, Reliance Life Plus Club

Finance Ministry Summoned Insurers in Service Tax Evasion Probe

Posted on October 9, 2012 by Akanksha

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The finance ministry has issued summons to about dozens of insurance companies seeking documents pertaining to sale of insurance policies and commission paid to their field associates as part of its probe into alleged service tax evasion of over Rs 300 crores by insurers.

Firms like ICICI Prudential, HDFC Standard Life, MetLife, Birla Sun Life and Reliance Life among others have been issued summons by Directorate General of Central Excise Intelligence (DGCEI), an intelligence arm under the Finance ministry.

The notices have been sent under Section 14 of the Central Excise Act, 1944. This section empowers a central excise officer to summon any person whose attendance he considers necessary either to give evidence or to produce a document or any other thing in inquiry being undertaken by the officer.

Preliminary probe so far has found alleged irregularities including evasion of service tax by misrepresenting the information on accounts book and fudging records related to commission paid to field associates, agents and brokers who were selling the insurance policies.

Categories: News | Tags: Birla Sun Life, Central Excise Act, DGCEI, Directorate General of Central Excise Intelligence, HDFC Standard Life, ICICI Prudential, Metlife, Reliance Life, Service Tax Evasion

Health Insurance Plans