1. LIFE INSURANCE COUNCIL Press Meet on Overview of Indian life insurance industry: trends & opportunities 20th FEBRUARY, 2014 Hyderabad

2. Overview of Indian Life Insurance Industry
Globally Largest retail financial service provider- 36 Cr. In-force policies
Population of 200/203 countries in the world is less than the total number of Indian life insurance customers
High capital intensive industry – `34,922 Cr. deployed upto December, 2013
` 6,046 Cr. FDI by International Joint Venture Partners
AUM of Life Insurers is ` lakh Cr. as on December, 2013
Major contributor to every 5 Year Plan for Nation Building Activities.
>10,000 offices across the country – 72% in semi-urban & rural areas
*As on 31st March 2013

3. Indian life insurance industry has grown over the years…
FY99-00
FY08-09
FY10-11
FY12-13
Dec 2013
(Provisional)
No. of Players 1 22 23 24 24
Capital (`Cr) 5
18,253
23,662
25,519
34,922
No. of Branches
2,048
11,815
11,546
10,285
10,903
Employees (in Lakh)
1.23
2.85
2.42
2.45
2.41
Individual Agents (in Lakh)
7.14
29.38
26.39
21.22
21.98
Source: IRDA Annual Report & Council MIS Report

4. …by touching the lives of people across the country
Sr. No.
State
No. of Branches* 1
Maharasthra
1051 2
Uttar Pradesh
1029 3
Andhra Pradesh
928 4
Tamil Nadu
853 5
Gujarat
626 6
Kerala
621 7
West Bengal
642 8
Karnataka
600 9
Rajasthan
494 10
Madhya Pradesh
518 11
Punjab
418 12
Bihar
387 13
Haryana
317 14
Orissa
339 15
Delhi
249 16
Assam
237 17
Jharkhand
232 18
Chhattisgarh
166 19
Uttrakhand
137 20
Himachal Pradesh
114 21
Jammu & Kashmir 94 22
Goa 52 23
Chandigarh 42 24
Tripura 31 25
Meghalaya 26
Puducherry 27
Arunachal Pradesh 28
Sikkim 29
Nagaland 30
Manipur
Mizoram 32
Andaman & Nicobar Islands 33
Dadra & Nagra Haveli 34
Daman & Diu 35
Lakshadweep
Total
10,285
10,903
No. of branches as on
31st December 2013 1 2 3 4 5 6 7 8 9 10
Top 10 states in terms of no. of branches
Source: IRDA Annual Report
*As on 31st March 2013

5. …and has made a significant contribution to the Indian economy
Provide stability to Capital Markets
Life Insurance companies have invested approximately `60,000 Cr. in the equity markets in
Contribution to Nation Building Activities
Investment in Central Govt. Securities and State Govt. Securities - `8,51, 914 Cr. upto December 2013
Investment in Infrastructure to the tune of `1,43,192 Cr.
Major contributor to every 5 year plan
Infrastructure Development
Direct employment lakh
Employment to more than lakh individual agents
Employment Generation

6. The industry has witnessed a moderate growth in Renewal Premium over the last few years
` Crore
2,91,639
Please include FYP + Renewal Premium + Investment Income data from April –Dec 2013 and the comparative data for the same period in 2012.
New Business Premium Renewal Premium Total Premium Total Revenue
Source: IRDA Annual Report

7. There has been a steady increase in Assets Under Management
Category of Investments
` Cr (%)
` Cr. (%)
` Cr (%)
September 2013 ` Cr. (%)
Traditional Products
Central Govt. Securities
47, (24.48%)
4,68, (38.64%)
5,11, (36.55%)
5,63,285
(37.29%)
State Govt. Securities
52, (27.07%)
2,14, (17.71%)
2,66, (19.02%)
2,88,629
(19.11%)
Infrastructure Investments
24, (12.80%)
97, (8.03%)
1,16, (8.34%)
1,43,192
(9.48%)
Approved Investments
50, (26.03%)
3,85, (31.79%)
4,45, (31.86%)
4,90,193
(32.45%)
Other than Approved Investments
18, (9.58%)
46, (3.82%)
59, (4.23%)
25,002
(1.65%)
ULIP
- -
3,46, (93.61%)
3,25, (94.97%)
3,03,667
(95.58%)
Other Investments
23, (6.39%)
17, (5.03%)
14,032
(4.41%)
Total
1,94,010
(100%)
15,81, (100%)
17,41, (100%)
18,28,001
Source: IRDA Annual Report

8. Industry has increased its focus on Customer Centricity

9. Customer Grievance Redressal through Integrated Grievance Management System (IGMS) has been successful
Year
No. of In-force policies
No. of Grievances reported
No. of Grievances attended
No. of Grievances pending
33.52 Cr.
3,09,613
3,08,331
(99.59%)
1282
(0.41%)
35.87 Cr.
3,42,294
3,41,070
(99.64%)
1224
(0.36%)
Please incorporate latest data
Source: IRDA Annual Report

10. Total benefits* paid to customers by Life Insurers
Total Benefits Paid (` Cr.)
Please incorporate latest data
* Total Benefits paid include Death claim, Maturity claim & Surrender payouts.
Source: IRDA Annual Report

11. Consistent improvement in Death Claims Settled by Life Insurers - By No. of Policies
Claims Paid
96%
97%
Claims Pending
2.1%
1.9% 2%
Claims Repudiated
1.8%
1.4% 1%

12. Driving Growth in Life Insurance Industry in India

13. Indian demography is favourable to the growth of Life Insurance
A mere 10% penetration in the increased insurable population has the potential to give additional new business of >Rs. 1 lakh Cr.
Life Expectancy
Insurable Population
Insurable population is expected to grow to 75 Cr. by FY 2020

14. However, Household Financial Savings as a % of GDP have dropped in recent past, resulting in shrinking share of insurance within financial savings
Share of gross household financial savings within GDP has declined
Gross household financial savings as a % of GDP
Within household financial savings, insurance has lost some sheen...
... as a result, share of life insurance within GDP has declined
% Share of Gross household financial savings
Life Insurance Funds as a % of GDP*

15. Multiple actions taken will bring back growth in
the life insurance industry
New Products with enhanced features launched from January 1, 2014
367 new products launched
Benefits for customers with higher insurance covers
Pioneers in the globe to grant license to e-repositories
5 Repositories authorized to open e-Insurance Accounts.
Distribution related initiatives
Expand distribution reach – Insurers are poised to increase number of agents to more than 3 million in the next 5 years
Utilize CSCs to expand reach – 1,00,000 CSCs each serving a cluster of 6-7 villages, covering ~6.5 lakh villages across India
Open Architecture – Banks to become brokers
Proposed Alternate Distribution Channel for Intermediaries

16. Projections
Life insurance segment has the potential to grow times its current size by
The Penetration level of Life insurance industry is expected to grow from 3.2% to 5% by year 2020
Expected CAGR of Life Insurance industry will be 12-15% in the next 3-5 years
The net Household Financial savings could reach around 30% in the next 3 years from the present level of 23.1% (FY 11-12); Life Insurance being the second most preferred financial instrument will benefit from this.

17. Life Insurance sector will continue to contribute to nation building
Life Insurance employment potential till FY 2020 – Lakh employees
Life insurance industry contribution to Infrastructure projects – Rs. 3.5 Lakh Cr. by FY 2020
Increase in FDI up to 10 billion US $ will increase customer coverage in rural and semi urban areas from 72% to 80% and fuel employment growth in the country and contribute to increase in GDP of the country.

18. Thank You