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Insurance premiums will increase as life insurance companies will pass on the hike in service tax, said Mr K. Sahay, MD and CEO, Star Union Dai-ichi Life Insurance.
“Policies will become costlier,” he said, while speaking at a press conference to announce the company's results for the financial year ended 2012, in Mumbai, on Tuesday.
The company's total premium grew 36 per cent to Rs 1,272 crore. New business premium grew by 27 per cent in the just ended year.
Nearly 75 per cent of its premium income was from retail business. Renewal premium collected was Rs 307 crore.
The share of premium from single premium policies has dropped to 67 per cent from 89 per cent earlier. The company will shift to selling more traditional policies as ULIPs are no longer attractive as a business proposition, said Mr Sahay.
With two big banks as its promoters — Bank of India and Union Bank of India — SUD Life has emerged as a bancassurance specialist. The share of policies sold through the bancassurance channel is as high as 92 per cent.
Growth prospects
In the current year, the company will see a growth of at least 25 per cent in new business premium and overall growth of 30 per cent in total premium, Mr Sahay said.
This year the company is also looking to launch three new products, which will include one traditional plan, one pension plan and one ULIP. It is also planning to launch an online term plan, Mr Sahay added.
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