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Insurance Motor and health insurance can be a huge market for agents: TS Vijayan

Motor and health insurance can be a huge market for agents: TS Vijayan

Vijayan also suggested that sum assured policies should be linked with price indexes.
Team Cafemutual Jan 23, 2018

TS Vijayan, Chairman, IRDAI said that motor and health insurance could become huge market for distributors. He was speaking at the FINCON 2018, the 19th annual insurance conference organised by Federation of Indian Chambers of Commerce and Industry (FICCI).

Outlining a roadmap for the next wave of growth in the insurance sector, he said, “What’s the next wave of growth coming in?” Motor claims, he observed are about Rs. 5 lakh on an average. “With a population of 120 crore people, there is a protection gap. The same is the case with health care. People spend more than Rs.3 lakh crore on health care. This is the kind of premium that health insurance companies can aspire for. And this is where growth is going to come from,” he said.

While the non-life industry collected Rs.50,250 crore through motor insurance policies, it mopped up close to Rs.34,500 crore through health insurance policies last fiscal.

Praising industry’s effort to increase the penetration of insurance, he said, “Business is growing. This year new premiums on life industry have gone up 20 per cent, non-life around 17-18 per cent, standalone more than 42 per cent. It has been a good year.”

He also suggested that ‘sum assured’ policies, even if they are long term, should be linked with price indexes. “It may be challenging, but it is possible today,” said Vijayan.

Linking sum assured policies with price indexes will help policyholders understand the impact of inflation on their policy. Such indexation accounts for changes in the economy and inflation, meaning that if your cost of living goes up then your policy payment goes up with it.

He also urged insurers and agents to harness technology to grow business.

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