The Hindu Business Line : Pvt insurers seek long-term G-secs for parking funds

PRIVATE life insurance companies have asked the Insurance Regulatory and Development Authority (IRDA) to request the Finance Ministry to come out with long-term Government securities for investment.

This was stated by Mr Shivaji Dam, Managing Director of OM Kotak Life Insurance Co Ltd. He was in city for the launching of OM Kotak's two pension products, namely `Kotak Retirement Income Plan' and `Kotak Capital Multiplier Plan'.

According to him, there are hardly any long-term investment instruments available in the market today for the insurance companies to safeguard their exposures in the pension-related schemes. The insurance companies want Government securities spread over a period of 30 or 40 years.

Recently, the Finance Ministry did launch a 30-year Government security.

However, Mr Dam felt that it was not enough to meet the needs of the growing pension market for the insurance companies.

It may be noted that leading private sector insurance players such as ICICI Prudential and HDFC Standard Life have already introduced pension-related products in the market.

Discussing the company's achievements in the current financial year, Mr Dam said, in April-December 2002-03, OM Kotak sold 17,000 policies for a sum assured of Rs 450 crore. In this period, premium income was Rs 25 crore.

"We are holding about six to seven per cent share in the private life insurance market,'' he said.

According to him, OM Kotak has been recording a steady monthly growth of around 20 per cent in the current fiscal, except for October and November.

Regarding new products, he said, OM Kotak will introduce new policies every four month for the next two years.

The company is now present in 27 cities with an agent strength of 2,500. In 2001-02, OM Kotak sold 13,000 policies accumulating to a sum assured of Rs 330 crore.

For the current year, Mr Dam ruled out fresh capital infusion in the company.

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