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IDBI Federal Life Insurance said on Tuesday that its shareholders have infused Rs 250 crore earlier this month to support business growth. After the capital infusion, the life insurer's paid-up capital has increased to Rs 700 crore.
IDBI Federal, a three-year-old tripartite joint venture between IDBI Bank, Federal Bank and European insurer Ageas, expects to add Rs 530 crore in new business in 2010-11. This would be a 35 per cent growth over the previous fiscal.
“We just infused Rs 250 crore in capital last Friday. Insurance is a long-term business and the shareholders are committed to infuse as much funds as needed for its growth,” Mr Hans Van Wuijckhuijse, COO, IDBI Federal, told Business Line .
Outlining the growth pattern in business, the official said that after the new unit-linked insurance plan (ULIP) norms were notified by IRDA in September 2010, the share of traditional policies have more than doubled to 50 per cent of sales from 20 per cent earlier.
Online sales
The company is looking to launch online sales of policies by May, even as it will add other distribution channels apart from bancassurance, which accounts for 70 per cent of sales. “We want to increase direct selling through tele-marketing, which we started this October. We will also start online sales from May through a term insurance product,” said an official.
IDBI Federal has launched ‘Retiresurance Guaranteed Pension Plan', a traditional policy that offers a guaranteed corpus for each premium paid. While helping customers secure their lifestyle post retirement, the plan also guarantees a growth of investment.
“This policy will help bridge the gap when one's income drops after 60, but expenses rise due to factors such as inflation and increased consumption. There are currently very few pension products in the market,” said Mr G.V. Nageswara Rao, MD & CEO, IDBI Federal.
He added that with the sale of pension products dropping to 30 per cent of the total, from 2 per cent post the new guidelines, there was a huge market potential for such products. Pension product sales had dipped because most such products had been equity-linked or ULIPs. The company also plans to launch a single premium pension ULIP soon.
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