Page 14 - Insurance Times August 2018
P. 14
Policy Bazaar investment India Post looks to spun off life insurance business into
separate unit
arm to raise $200 million
In order to increase financial inclusion, the Department of Posts is planning to
ETechAces Marketing & Consulting, build on its life insurance offerings that would be spun off
owner of India's leading insurtech as a separate unit.
brand PolicyBazaar.com and lending "We have two good products which have even lower pre-
marketplace PaisaBazaar.com, said mium than what LIC offers. But we have not been able to
it has raised $200 million in a Series- utilise it to its full potential… there is a huge potential in
F investment round led by SoftBank the insurance sector," Ministry of State for Communication
Vision Fund. Existing investors, in- Manoj Sinha told.
cluding InfoEdge (Naukri.com), also
participated in the round. The com- "Now we are in the process of making it a separate insurance company under
pany didn't disclose details on the the Department of Posts. First, we will have independent strategic business unit…
quantum of stake sold. We should be able to do this in two years," he said.
Yashish Dahiya, Co-Founder and The schemes, Postal Life Insurance (PLI) and Rural Postal Life Insurance (RPLI),
Group CEO, EtechAces said, " were earlier available only for government sector employees. The government
SoftBank's culture of backing disrup- expanded the scheme to include professionals such as doctors, engineers, man-
tive businesses and industry leaders agement consultants, chartered accountants, architects, lawyers and bankers,
with long-term capital investment and to employees of listed companies.
gels well with our own values and
vision of creating a transparent and The PLI, introduced in 1884, is one of the oldest life insurance schemes in the
empowering financial products mar- country, while the RPLI was introduced in 1995 to provide insurance cover for
ketplace." people residing in rural areas.
According to Boston Consulting According to industry estimates, there are about 5,000 touch points for insur-
Group's estimates, digital influence ers in the country in contrast with over 1.5 lakh post offices with a strong rural
on insurance purchases will grow to base.
50 percent for life insurance and 75
percent for general insurance by As on March 31, 2017, there were 46.8 lakh PLI and 146.8 lakh RPLI policies
2020. This translates to nearly Rs 1.2 taken across the country. The Minister added that the Life Insurance Fund (Assest
lakh crore of new insurance premium Under Management) increased 2.5 times for the schemes from Rs.25,856 crore
being digitally influenced by that in March 2014 to Rs.66,905 crore in March 2018.
time.
The Minister further added that under the Sampoorna Bima Gram (SBG) Yojana
PolicyBazaar believes this will enable - another scheme launched for the expansion of clientèle of Postal Life Insur-
it to grow at a CAGR of 80 percent ance - which currently covers 1,244 villages, will be expanded to 10,000 villages
over the next three years, achieving 10 by March 2019.
million transacting customers by 2020.
Munish Varma, Partner at SoftBank In- Aegon Life Insurance to focus on term insurance
vestment Advisers, said that over the
last decade, PolicyBazaar has become Aegon Life Insurance Co. in order to spur growth is focussing to sell term insur-
synonymous with online insurance ance product. Term policies are more profitable
shopping in India. but difficult to push as Indians typically look for
returns at the end of the policy period. "The trend
"We believe that the Indian insur- is changing now, and the younger generation
ance market continues to remain wants to first buy protection," said Aegon Life's
massively under-developed and chief executive Vineet Arora.
PolicyBazaar, supported by
SoftBank's capital and ecosystem, is India is largely a savings and investment market. "But this also means that it is
uniquely positioned to dramatically a great opportunity for the protection market to grow faster. The protection
increase the adoption of insurance market is growing much faster than savings," Arora said
products in the country," Varma said.
More than half the policies sold by Aegon Life in FY18 were term policies. By
way of premium, that could be about 30% of the Rs 145 crore mobilized last
fiscal. Last financial year, it earned Rs 89 crore as premium. It lunched a term
insurance plan for up to 100 years last year.
14 The Insurance Times, August 2018
