Page 16 - The Insurance Times March 2025

According to Londe, govt's decision to Life insurers rejig agent one month. The insurer will refund the
link capital infusion in public sector first premium paid if the policyholder
general insurance to underwriting fee structures returns the policy within the period,”
profits has had a positive impact on the Listed life insurance companies have Nagaraju said during a post-Budget
industry. He added that persistently modified their commission structure press conference in Mumbai.
weak prices in insurance suppress the based on persistent performance of Nagaraju said public-sector companies
sector's profitability. various distribution channels, and had been asked to introduce ‘call back’
redesigned products to mitigate the
Another attraction for some foreign in insurance policies, i.e., once the
insurers would be the proposal to allow impact of the revised surrender value product is sold, a call back is sent to
monoline insurers and composite norms. the customer to understand whether
insurance companies. "There are he/she is happy with the product or if
many insurers globally who focus on Govt asks private insurers they want to surrender. “We have also
one line of insurance activity. They will to increase free look asked private companies to do the
be encouraged to come to India," said same so that mis-selling is not there,”
Londe. period to one year the secretary said.
The government has asked private
IRDAI revised the surrender insurers to increase the free-look BALIC becomes the first
value guidelines effective period for policyholders from one insurer to go live with
month to a year, Department of
from October 1, 2024. Financial Services (DFS) Secretary M Bima-ASBA facility
HDFC Life has revised its commissions Nagaraju said. Private life insurer Bajaj Allianz Life
based on the persistency profile of the Insurance on Saturday announced that
distributor. "It is a combination The free-look period is the length of it has become the first insurer to go live
depending on the level of business, time during which a customer can with the BIMA- Application Supported
partners, inherent persistency in that cancel an insurance policy without by Blocked Amount facility (Bima-
channel, and so on. We have done a paying surrender charges. Last year, ASBA), the company said in its press
combination of commission clawback, the insurance regulator increased the release.
commission deferral, and reduction in period to 30 days from 15 days.
commission. It is fairly bespok for every “The government has introduced and This milestone aligns with the
relationship," said Vibha Padalkar, encourages insurance companies to Insurance Regulatory and Develop-
managing director and chief executive increase the look-out (free-look) period ment Authority of India’s (Irdai)
officer (MD & CEO) of the company. of insurance policies to one year from initiative to bring operational ease,
enhance policyholder convenience,
ensure greater transparency, and
LIC's Q3 profit rises 17% as expenses decline simplify the insurance premium
LIC, reported a 17% rise in third-quarter profit, helped by a fall in employee- payment process.
related expenses. Through Bima-ASBA, policyholders can
LIC's profit after tax rose to Rs 11,056 crore ($1.26 billion) for the quarter opt for UPI’s One-Time Mandate
ended December 31 from 94.44 billion rupees a year earlier. Employee (OTM) and authorise the blocking of a
compensation and welfare expenses dropped 30% to Rs 6,691 crore. specified amount, i.e up to Rs 2 lakh,
in their bank account via UPI. The
LIC's policy sales in the quarter were under pressure due to new regulations,
amount will be debited only after the
which reduced the charges policyholders paid if they closed their policies
insurance company completes the
before maturity. The insurer had boosted sales before the norm changed underwriting process and decides to
from October.
accept the proposal.
Its net premium income dropped 9% to Rs 1.07 trillion, driven by a 24% fall If the application is not processed
in single premiums and a 14% decline in first-year premium collection.
within a period of 14 days or the
Solvency ratio, the measure of an insurer's ability to meet its long-term proposal is not accepted, the blocked
financial obligations, rose to 2.02 during the quarter from 1.93 a year earlier amount is automatically released back
and 1.98 in the prior quarter. to the customer.

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