Page 18 - Insurance Times March 2024

instead of having the threshold value The shift was believed to have a Indian cities -- which also pointed out
as an absolute amount, sources said. potential impact on the profit margins that life insurance sales through digital
They said life insurance companies of non-participating products of these mode have increased compared to the
have put forth their recommendation, companies. last survey.
which will be submitted to the IRDAI suggested that there shall be a At the same time, life insurance
insurance regulator through the Life premium threshold defined for each ownership levels increased to 75
Insurance Council. product, wherein, there shall not be compared to 73 (IPQ 5.0). Over a five-
"We understand the thought process any surrender charges imposed on the year period, the India Protection
behind IRDAI's exposure draft on the balance of the premiums beyond such Quotient has witnessed an impressive
surrender value about safeguarding threshold limits, irrespective of the 10-point increase, from 35 in IPQ 1.0 to
the interests of the customers. After timing of the surrender. 45 in IPQ 6.0, that reiterates Urban
India's constant journey towards building
due deliberations, the companies have
suggested that the surrender value Life Insurance awareness, financial resilience, the report said.
could be linked to the accumulated adoption rise among Urban In line with previous findings, South
policy value of customers instead of India retained its position as the most
having it as an absolute amount," an Indians, says report financially protected zone with a
insurance official told. Urban India witnessed remarkable Protection Quotient of 49 points, the
The accumulated policy value in an progress in financial readiness, with 3 report said, adding this was followed
out of 4 urban Indians now owning life by West India, showcasing a marked
insurance policy represents the
insurance products, according to a improvement in financial preparedness
'savings component' of the policy,
report. from 42 points in IPQ 5.0 to 46 points
where a portion of the premium paid
by the policyholder is allocated after The Protection Index is at an all-time in IPQ 6.0. North and East zones lagged
in financial protection at 41 and 40
subtracting the cost of insurance. high of 45 in India Protection Quotient
The exposure draft by IRDAI in (IPQ) 6.0, up from 43 in IPQ 5.0, points in this edition, respectively.
December 2023 outlined the reflecting a positive trajectory in the Max Life MD and CEO Prashant
introduction of a defined premium nation's evolving protection awareness Tripathy said over the past five
threshold for each product, beyond and adoption. editions, the IPQ has become a true
which no surrender charges will be Max Life Insurance released IPQ 6.0 -- barometer for measuring urban India's
levied. tapping 4,700 respondents across 25 financial protection levels.
"By including incremental cohorts
Insurance agents got extra Rs. 25,000 crore via benami year-on-year, IPQ has become
stronger, bigger, and more inclusive.
companies: I-T Dept
We are witnessing a remarkable shift
Over Rs 25,000 crore changing hands in deals involving more than 60 in the financial consciousness of this
intermediary firms using hundreds of bank accounts mark the contours of diverse group, with 3 out of 4 urban
the elaborate probe on suspected Benami transactions between agents of Indians now owning life insurance," he
insurance companies and go-between entities. said.
The Income Tax department is learnt to have prepared an assessment report
on how a string of intermediaries were used by insurers to pay off extra Join
commission - over and above allowed under regulations - to their agents
selling insurance policies.
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However, the insurance companies, who were pulled up last year by the I-
T department, are not the actors under the benami investigation. Course on
The current investigation, which is at an initial stage, focuses on the
intermediary entities acting as 'benamidars' and the official agents which Motor Insurance
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The I-T department estimates the benami amount - the quantum of excess,
unauthorised payment - to be in excess of Rs 25,000 crore, sources told. www.smartonlinecourse.co.in

The Insurance Times March 2024 17