SBI Life Insurance, a joint venture between State Bank of India and BNP Paribas Cardif, aims to grow the share of pure-protection policies to double-digits this fiscal from a low single-digit last year.

Business from protection policies (including both individual and group), which are term insurance schemes that provide coverage against the risk of death but without return of premiums, formed 5.5 per cent of the new business premium SBI Life secured in 2017-18.

“This year we have embarked on a journey to increase the share of pure protection business to 12.5-13 per cent, and we want the individual segment to occupy 2.5-3 per cent (from 0.7 per cent). We have been successful to a certain extent so far,” Sanjeev Nautiyal, Managing Director and CEO, SBI Life Insurance Co, told BusinessLine .

With more efforts, the share of protection business is on the rise. As of Q1, the share increased to 10 per cent of the overall new business premium, and individual segment’s share increased to 2 per cent.

While the company sees significant scope for growth in this segment due to inadequate term insurance coverage, Nautiyal felt that the life insurance industry had also started maturing a little bit as customers were looking for pure protection plans.

“Protection plans bring real insurance products to customers, and it builds a safety net for the family. Also, it makes a lot of sense to the insurance company and the industry, too. It is such a holistic product but didn’t receive the attention it required in the past,” he said.

Explaining SBI Life’s plans, Nautiyal said while insurance products may mimic each other with subtle differentiation, pricing and marketing to the right set of customers are important.

SBI Life seeks to focus on the two areas with a greater differentiation, he said. The company offers five pure-protection policies, and is betting big on its latest product, Poorna Suraksha. “Within the available framework of limitations, this product provides some innovative benefits and is the first-of-its-kind,” he said.

Digital focus

He also highlighted that the company’s digital focus was paying dividends as the share of digitally-sourced policies was seeing a significant increase.

“I am happy to report our team has been responding well. Earlier, the digital penetration in bancassurance and agency channels combined was 20-22 per cent. Today, the penetration is 90-92 per cent for bancassurance, while agency channel has also started sourcing on the digital platform to the extent of 70 per cent,” he said.

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