Children plan in life insurance business posts quick development

The children plan segment in the domestic life insurance industry is growing fast due to increasing awareness among consumers.

Today, the segment accounts for 20-25 per cent of the life insurance space in India.

“There is a growing realisation among people that education in the future would be quite expensive, so people are investing in children plan to ensure their quality education,” private insurer Max New York Life Insurance Senior Director and Chief Distribution Officer Ashish Vohra told Business Standard. “Five years back, the proportion of children plans in life insurance industry was half of today’s volume,” he informed.

Vohra said the segment would continue to grow rapidly, since the education sector had also witnessed the entry of private players in a big way and it has been well accepted that quality education in the future would come at a price. Commenting on the likely effects on life insurance industry due to the proposed Direct Tax Code (DTC), he said according to the disclosures made so far, there were not many incentives for the segment. “However, DTC would encourage long-term life insurance policies with minimum cover of 20 years,” he added.

Meanwhile, Vohra said the growth rate of life insurance industry was likely to dip by 15 per cent for 2010-11, due to certain regulatory issues that had cropped up. “During 2009-10, the new business premium for life insurance segment was about Rs 80,000 crore, which is likely to dip to under Rs 70,000 crore for 2010-11, he said.

He was in town to announce the company’s scholarship programme igenius 2011, which kicks off tomorrow. The programme promises 1,000 scholarships worth Rs 1 crore to students, selected through multi-level pan-India evaluation process.

Bajaj Allianz Life launches ‘Two Bright Futures’ plan

Bajaj Allianz has launched a single proposal called ‘Two Bright Futures’. Under this plan, the company will set away Rs.100 for every child insurance plan sold towards financial support the education of under-privileged children.

This plan has been implemented from 20th May onwards. The funding corpus would be handed over to select NGO’s crossways the countries, which are working for a related cause.

This amount will be set aside exclusively by Bajaj Allianz and no amount will be deducted from the customer who purchases a child insurance plan from Bajaj Allianz Life Insurance.

In the first phase of the plan, Bajaj Allianz has tied-up with Aseema Trust, a Mumbai-based organization working towards providing holistic education to children living on the streets or in slum communities. Aseema works in partnership with the Municipal Corporation of better Mumbai to impart value-based and quality education to children from pre-primary to Standard 10.

Bajaj Allianz handed more than the first contribution cheque of Rs.4.24 lakh to Aseema Trust last week. This amount will be used to purchase books, uniforms, bags, stationery and support classes.

Akshay Mehrotra, Head – Marketing, Bajaj Allianz Life Insurance said “Through this insurance plan we are ensuring a brilliant future for a child who needs our support the most. We feel that the ‘Two Bright Futures’ program would be a small step in shaping their futures.”

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ING Life India launches New Plans

ING Life India, part of ING Group, has announced the launch of five new customer centric unit linked insurance products including savings for Retirement Plan and Children Plan education and investments.

The new products are ING New Creating Star, ING New Prime Life, ING Freedom Plan, ING Future Perfect and ING New Golden Life helping customers to maximise their returns. The company also launched two new funds.

Ashwin B, chief operating officer, ING Life India, told media persons here that in addition to the funds, two pre-defined investment strategies for customers were also announced, ING Prudent and ING Enhancer.

The company has completely revamped its ULIPs portfolio for enhanced customer benefits.

He pointed out that the ULIPs will find it helpful as the yield will go up due to reduced charges on the products and important loyalty additions to their funds upto 275 percent. The products offer the suppleness to customers to surrender, if they require funds in an emergency, without paying any submit charges after five years.

Aviva to turn out four insurance plans by ’09-10

Aviva Life Insurance Company Limited, one of India’s leading life insurance companies, plans to come out with 3-4 new insurance products including a new Children’s insurance plan before the end of the current fiscal year.

“We are planning to come out with 3-4 new insurance products before the end of this fiscal”, Munish Sharda, director (sales and distribution), Aviva Life Insurance told reporters here.

Aviva, which has 14 products as of now, has recorded a pan-India premium collection of Rs 2150 crore during January-November this year.

Around 10 per cent of the company’s business comes from the Children plan and the eastern region accounts for nearly 25 per cent of Aviva’s total business.

Aviva India on Friday released a research report on the savings habits of young parents in 10 cities across the country including Bhubaneswar. The study, called Aviva Young Scholar Insights, surveyed 2250 parents and was conducted on behalf of Aviva India by Mumbai-based IMRB International.

According to the parents surveyed in Bhubaneswar, 49 per cent stated that planning for a child’s future takes priority over retirement.

For 86 per cent of the parents in the city, school education of their children is indicated as the key trigger for savings and 57 per cent of the parents start investing before the child turned three.

Commenting on the survey, Sharda said, “As the survey suggests, parents in Bhubaneswar believe that Education is Insurance to secure a brighter future for their children. This is also clearly indicated by the growing concern among parents to combat the rising cost of education.”

“At Aviva, our focus is to minimize the financial constraints of parents to enable best education for their children. We do this through a focused five-pillar approach which includes the best in class products, financial literacy programmes, advertising, corporate responsibility initiatives and leveraging our strategic partners”, he added. The survey says that two-thirds of the parents in Bhubaneswar are keen for their child to become a doctor or an engineer.

About 58 per cent of the parents in the city are willing to cut on their expenses related to shopping and outings to save for their children’s future. Nearly half of the parents surveyed in the city prefer flexibility in premium payment options.

No shock on Axa’s Indian ops

The National Australia Bank’s achievement of AXA Asia Pacific Holdings is unlikely to have an impact on the latter’s Indian insurance and asset management ventures.

AXA Asia Pacific Holdings is responsible for life insurance business in India. AXA Asia Pacific and AXA SA hold 13 per cent each in Bharti Axa Insurance, the life insurance joint venture with telecom major Bharti, which holds 74 per cent.

“The acquisition is in the initial phase and yet to get narrow approvals. AXA SA with buy out all Asian operations, while the businesses in Australia and New Zealand will be acquired by the Australian bank,” said a senior executive at Bharti AXA Life Insurance.

The non-life insurance business and the mutual fund company come under AXA SA, the parent which is headquartered in Paris, and therefore, it will not have any impact.

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Kotak Life Insurance appoints Sudhakar Shanbag as new Chief Investment Officer

Kotak Mahindra Old Mutual Life Insurance Limited (Kotak Life Insurance) today announced the appointment of Sudhakar Shanbag as its Chief Investment Officer from December 11th 2009. Mr. Shanbag, a Chartered Accountant has been a part of the Kotak Team in varying capacities. Prior to Kotak Life Insurance, Mr. Shanbag was part of the Treasury team at Kotak Mahindra Bank.

He has also been an integral part of the Kotak Prime team for 11 years, serving first as a Chief Financial Officer and then taking over as Chief Operating Officer.

Commenting on the appointment, Mr. Pankaj Desai, Executive Director, Kotak Life Insurance said, “With our current AUM of 5600 Crores, projected to cross the 10,000 crore mark in the next 12 months, Sudhakar’s role is going to be very critical. We are confident that with his appointment, our position as Investment experts will be reinforced consistently.”

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