Private sector Kotak Life Insurance is likely to hike term insurance rates soon.

The move comes when many of life insurance companies have been increasing premiums for term insurance following higher Covid related death claims and hardening of rates by reinsurers.

“Our pricing will align with the new reality…it will largely be on pure term products,” said Mahesh Balasubramanian, Managing Director,KotakMahindraLifeInsurance Company, in a media round table on Wednesday.

He declined to comment on the quantum of hike in the rates but said the company is assessing the situation and will file a product with the regulator soon.

The insurer had last revised prices for term insurance products in January 2021.

The company remains positive about the prospects for the insurance industry.

“We expect insurance industry to grow at a healthy rate of 15 per cent CAGR over the next five years,” said Balasubramanian.

This would be on the back of increasing awareness, insurers leveraging technology, rising income levels and favourable demography, he further said.

Kotak Life Insurance registered a 37 per cent growth in its gross new business premium between April and November 2021. Its business grew by 20 per cent year on year in the period, and the group business grew strongly by 55 per cent year on year.

The insurer, which had already significantly strengthened its digital enablement and adoption last year, aims to further leverage its digital assets to offer comprehensive solutions for its customers.