Page 14 - The Insurance Times December 2024

insurance companies, marking a strategic focus underscores the premium (NBP) collections in October
significant move for both parties in the importance of international markets in 2024, totaling Rs. 30,347 crore. While
competitive Indian insurance market. Bajaj Allianz's growth plans. private insurers reported an 18%
Allianz, currently partnered with Bajaj increase, state-owned LIC saw a 9.48%
Finserv in India, has expressed LIC Agents Protest rise in premiums, reaching Rs. 17,131
intentions to exit its existing ventures, Clawback Norms and crore.
citing strategic differences. While the The growth was driven by term
discussions between Jio Financial and Commission Cuts insurance and ULIP plans, despite the
Allianz are in early stages, both parties LIC agents are opposing new clawback implementation of revised surrender
appear committed to exploring norms introduced for prematurely value norms in October. These norms
opportunities. Allianz has reiterated its surrendered policies, along with now require insurers to pay enhanced
dedication to the Indian insurance reductions in first-year commissions. surrender values to policyholders
sector, signaling its long-term plans for Under the revised structure, first-year exiting after the first policy year.
growth and market expansion. commissions have been reduced from Analysts predict fluctuating growth in
35% to 28%, while renewal premiums the coming months as insurers adapt
Bajaj Allianz Life Witnesses now offer a slightly increased to these regulatory changes.
commission of 7.5%.
Strong NRI Demand in UAE
The clawback clause allows LIC to Jio-Allianz Partnership
and US recover commissions from agents if Could Reshape Indian
Bajaj Allianz Life Insurance has policyholders surrender their policies
reported increased demand for its shortly after the first premium Insurance Market
products among non-resident Indians payment. Agents argue that this Jio Financial Services' potential
(NRIs) in key markets such as the UAE, change, coupled with increased partnership with Allianz SE could
US, UK, Qatar, and Saudi Arabia. The operational costs, is detrimental to significantly impact the Indian
company's Dubai representative office, their livelihood. The All India Life insurance landscape. The collaboration
opened 18 months ago, has been well- Insurance Agent Federation has aims to establish separate general and
received by the NRI community, demanded the withdrawal of these life insurance companies, leveraging
particularly in the Gulf Cooperation changes, threatening a nationwide Jio's extensive network and Allianz's
Council (GCC) region. strike if their demands are not met. global expertise.

NRIs are drawn to Bajaj Allianz's products If finalized, the partnership could
due to their affordability compared to Life Insurers Report 13% intensify competition, prompting
global insurers. The insurer has tailored Growth in New Business existing players to innovate and
offerings to meet the unique needs of improve services. Allianz's exit from its
NRIs, supported by innovations such as Premiums current ventures reflects its strategic
video call centers that provide Life insurance companies registered a realignment, while Jio's entry into
personalized customer experiences. This 13.16% YoY growth in new business insurance highlights its ambition to
diversify its financial services portfolio.
LIC Reports 4% Dip in Q2 Profit Due to Higher
LIC Navigates Challenges
Payouts
Amid Regulatory Changes
The Life Insurance Corporation of India (LIC) reported a 4% year-on-year
(YoY) decline in standalone net profit for the second quarter, reaching Rs. LIC's 4% decline in Q2 net profit
7,621 crore. This decrease is attributed to higher payouts for benefits, highlights the challenges posed by
changes in actuarial liability, and fund transfers to policyholder accounts. regulatory changes and increased
payouts. Despite this, the insurer
Despite the dip in profits, LIC reported a 12% YoY growth in net premium reported strong growth in premium
income at Rs. 1,19,901 crore and a 16% increase in investment income. collections and investments. CEO
CEO Siddhartha Mohanty expressed optimism for the second half of the fiscal Siddhartha Mohanty expressed
year, citing strong growth in the value of new business (VNB). LIC's confidence in the company's ability to
investment portfolio grew by 17% YoY, reflecting its continued dominance navigate these challenges and
in the life insurance market.
maintain its market leadership.
14 December 2024 The Insurance Times