The IDBI Federal Life will soon enter the Group Insurance sector and also make insurance products available online. The company intends to use multi-channels to promote both the products, which are fast gaining recognition in the rapidly growing Insurance industry.
This insurance company, which is a JV between the Federal Bank, IDBI Bank, and European insurance major Ageas, is a building a special team for promoting its group insurance products. The IDBI Federal Life has over 11,000 agencies and 250 direct sales force outlets through which it promotes its insurance products.
Vignesh Shahane, CEO, IDBI Federal Life is optimistic on the improvement in the investors’ sentiments, with a stable political situation and a 49% increase in the Foreign Direct Investment (FDI) limit. He believes that the Insurance sector will record a single-digit growth in the current financial year. Nonetheless, Mr. Shahane also anticipates the business challenges, especially in the form of trust deficit and sustaining the cost-rationalization ratio.
Significance of ULIPs Returning
The unit-linked insurance plans (ULIPs) that had witnessed a steep decline, with the introduction of new norms by the IRDA including cap on agent commission, is preparing for a comeback in 2014. The extreme awareness on ULIP schemes is quickly increasing and the time is not far when insurance companies will begin to monetize the investments.
The recent launch of bank-allied ULIP endowment product Wealthsurance Suvidha Growth Insurance plan with guaranteed returns is aimed to reel in the first-time ULIP investors. The
The IDBI Federal Life has no immediate requirement to capitalize the ULIP policies, because the solvency margin is 472% for the company as against the IRDA’s need for 150%.
Claims Settlement Ratio
The IDBI Federal Life has recently introduced the 8-days claim settlement guarantee, and will pay 8% interest on the death benefit. With the claim settlement ratio touching the 90% mark in 2103, the refutation ratio in 2014 has been drastically reduced to 5.47% as against 16% in the former year.
However, the claim settlement guarantee is applicable, if the specific policy has completed 2 years or more, from the policy inception date to the life insurance’s date of death, and if the claim did not need any further investigations.
This joint venture Life Insurance Company is focused on offering great benefits to the customers with their newly launched slew of insurance products. Keeping up with the prevalent, essential reforms in the industry, the IDBI Federal Life is taking a step forward, with and optimistic focus and approach on its online products and group insurance products.
(Source: This article has been adapted from the article "IDBI Federal Life to step up focus on group insurance, online products" that appeared on October 27, 2014 in thehindubusinessline.com.)
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