Insurance behemoth Life Insurance Corporation (LIC) wants to leave the distribution channel choice to the customers themselves and will not look to change its current channel mix to boost sales and improve life insurance penetration in the country, BC Patnaik, Managing Director, LIC, said.
“The fact remains that people deserve insurance. Whatever be the distribution channel …they have to choose what is comfortable for them. We should not be talking about channels. The fact is insurance should grow and whatever is comfortable to the customer that channel should be grown and supported,” Patnaik said at the 4th edition of BusinessLine Changemakers awards in the Capital.
Patnaik, in a conversation with BusinessLine ‘s Senior Associate Editor SK Lokeshwarri, also said that he sees all kinds and categories of life insurance products co-exist in the Indian market as customers’ needs are varied. He does not expect any one particular product to drive overall life insurance penetration in the country.
BC Patnaik, Managing Director, LIC talks about the distribution channel choice for customers
Large market share
Patnaik said that LIC is “all positive” about life insurance growth opportunity in India. His remarks are significant as India’s life insurance premiums are expected to touch a record $100 billion this calendar year. LIC commands a mammoth 65 per cent plus market share in this industry segment. India’s life insurance market is expected to emerge as the 5th largest in the world by 2032, a recent Swiss Re report had said.
He also said that LIC has always been very keen to adopt the latest technology and expects to soon emerge as leader on the technology adoption front across all aspects of life insurance cycle.
Patnaik also highlighted that both the regulator and the government want the life insurance industry to grow at CAGR of 30-40 per cent and LIC, as a player, has wholeheartedly accepted this growth aim, which is eminently possible to be achieved.
He also said that the agency channel has paid good dividends for LIC since inception and it would be “surviving, thriving and growing” in the coming years..
“ Prior to 2000 there was nothing called bancassurance. It was only agency. They (agency) have done a good job and would continue to do,” he said.
He noted that customers who are comfortable with banca or brokers channel can choose them for their comfortPaitnak expects the Banca channel to survive.
Patnaik also sees strong growth for micro insurance in rural markets and sees good adoption of technology by industry on this front to reach the last mile customers in far flung rural areas..