Page 19 - Insurance Times February 2024

sales. Competitive intensity in the individual premiums totalled Rs. The share price of LIC gained Rs. 7.75
segment remains elevated. The health 38,608.34 crore, lower than Rs. or 0.93 per cent to Rs. 840.20 at 11.54
segment continues to grow at a steady 38,760.92 crore collected in the same am on NSE.
rate," noted analysts at Nuvama period last fiscal.
Institutional Equities. According to the In the first half of this fiscal, LIC had Bancassurance sought on
research note, the combined ratio, reported a net profit of Rs. 17,469
which is a measure of the profitability curbing misselling of
crore, its highest ever half-yearly
of the general insurer, is likely to rise profit, largely on account of transfer of insurance products
to 104.9 per cent as compared to Rs. 13,768 crore, pertaining to The government has sought
104.4 per cent in the year-ago period. accretion on available solvency suggestions from lenders on steps to
margin, from non-participating curb misselling through banking
LIC's premium receipts policyholders' fund to shareholders' channels as part of efforts to
soar 93.8% in December account. strengthen regulatory oversight of the
bancassurance model, said people
LIC registered a 93.8 per cent increase Total premium garnered by private life aware of the matter.
in total premium for the month of insurers in December 2023 stood at Rs.
December 2023 at Rs. 22,981.28 crore 15,601.85 crore, up 4.15 per cent over Some of the measures being
against Rs. 11,858.50 crore in Rs. 14,979.79 crore in same month in considered may include a cap on
December 2022. This strong show was previous year, official data showed. commission charges paid to banks for
aided by 178 per cent increase in In December 2023, private life insurers selling insurance products, stricter
Group Premium in December 2023 at reported a total individual premium disclosures of commission while selling
policies, and delinking bank
Rs. 17,812.46 crore (Rs. 6,407.37 collection of Rs. 10,897.36 crore, up
crore), data with Life Insurance Council 8.24 per cent over the level of Rs. employees' performance appraisals
showed. 10,067. 97 crore in same month in from insurance sales targets, said the
people.
However, in December 2023, LIC's previous fiscal.
Last month, financial services secretary
individual premium recorded a 4.91 However, the group premiums Vivek Joshi held a meeting with chiefs
per cent decline to Rs. 5,111.52 crore collected by private life insurers of state-run banks over issues related
(Rs. 5,375.19 crore). For the nine declined 3.75 per cent to Rs. 4,095.60 to bancassurance, including its
months ended December 2023, LIC's crore (Rs. 4,254.43 crore).
effectiveness in increasing insurance
penetration and challenges in the form
Mis-selling: Govt suggests checks on insurance
of misselling.
agents In 2022-23, the contribution of banks
Soon, insurance agents may be required to maintain audio-visual records of as corporate agents was 5.93% in non-
their sales pitch, where they must read out a summary of the policy features life premiums and 17.44% in new
to prospective buyers. With multiple cases in consumer forums and business premiums for life insurance.
thousands of complaints of mis-selling, the consumer affairs department has
A senior bank executive said
written to the finance ministry seeking a change in rules that the terms &
discussions are being held with all
conditions, or at least the summary, should be clearly explained as it is not
stakeholders, including the IRDAI and
properly communicated, resulting in disputes. both life and general insurance
In a letter to financial services secretary Vivek Joshi, consumer affairs councils.
secretary Rohit Kumar Singh has noted that the genesis of the dispute often In October 2023, the IRDAI had set up
lies in lack of proper communication, although consumers often complain a task force to review the existing
that only positive aspects of the policy are told to them when insurance is banking intermediation model and
sold. A final decision on the issue will, however, have to be taken by the carry out modifications in the
IRDAI, which sets the rules. regulatory framework. The committee
Also flagging that terms and conditions in insurance policies are often in is to submit its report this month.
"ambiguous language", which are not understood by consumers, Singh has "One suggestion is that there should
suggested that insurance policies be framed "in the regional languages be a cap of around 15% of the total
concerning the rural population of that particular area". premium on commissions and other

18 February 2024 The Insurance Times