Max Life Insurance MD and CEO Prashant Tripathy said on Wednesday that the focus on its counterpart Life Insurance Corporation (LIC) which debuted in the market on Tuesday will not impact the business as there is a huge request for products without parity or without participation. .
A non-participating insurance plan offers no dividend payout, which means that the policyholder does not participate in the profits made by the insurer. While an au par or with participation product allows the insured to participate in the profits.
LIC has traditionally sold more participating products, but recently hinted at its focus on growing the non-participating business. For Max Life, non-participating savings products performed well among all traditional plans.
In the same quarter last year, Max Life’s overall traditional plans, including participating and non-participating products and protection products, accounted for 65% of the total portfolio, with the remaining 35% being insurance plans. linked to units.
“When it comes to non-compliant product designs, there is huge demand in the market and with the stock market not functioning, I think this line of business will do very well,” Tripathy said in a statement. interview with CNBC-TV18.
Max Life Insurance has a 10% market share among private players and the company hopes to increase it in the future, Tripathy said, adding that the forecast for the New Business Value (NBV) margin is close to 26% for the current fiscal year.
LIC’s VNB margin is 9.9%, well below its private peers, however, the company told CNBC-TV18 that it would take less time than private players to achieve VNB margin levels of 20% after listing.
| Company | VNB margin (FY22) |
| HDFC lifetime | 27.4% |
| ICICI Pru Life | 28% |
| SBI Life | 26% |
| Maximum life | 27.4% |
Max Life expects Axis Bank to increase its stake in the company by 7% over the next few quarters as part of the restructuring of its parent company Max Financial Services.
Last year, Axis Bank became co-sponsor of Max Life Insurance with an acquisition of 12.99% of the capital collectively by the Axis entities in the company.
“Over the next four to six quarters, we will ask Axis Bank to increase its share from 13% to almost 20%. This is part of a certain structure (restructuring) that is going to happen,” Tripathy said.
“At the counter of Axis Bank, our share last year was around 75% and we hope that we will be able to maintain this share,” he added.
First post: STI
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