Small towns, which are largely underpenetrated, will in part drive growth in the life sector in India, according to Mr Deepak Mittal, MD and CEO, Edelweiss Tokio Life Insurance.
Insurers will push the envelope in product innovation to cater to the different demands of these customers. Adoption of enhanced technology will also support the growth, he said in an interview with The Hindu.
Describing Edelweiss Tokio Life, Mr Mittal said that the company is consciously moving towards including semi-urban and rural towns in its distribution footprint. From a predominant urban presence, the insurer now generates nearly half of its business from small towns.
“We believe that the next phase of growth will come from Tier 2 and 3 cities, which is why our expansion efforts will be concentrated in these cities,” he said.
“In fact, our online business has been an important channel in expanding our reach to a wider range of cities. We have seen heartening traction in this channel; we sold our online products across 100 cities in India in just one year.”
Over the last three years, the Indian life insurance industry has ben on a positive trajectory, he said. The industry would likely have closed the financial year ended 31 March 2018 with about 20% growth in new business premium. This growth was driven by post-demonetisation savings flow, a stellar performance in the equity markets and an expanding distribution footprint.
The industry will sustain the robust growth rate in the new financial year which began yesterday. In the coming years, the industry at large will make concentrated efforts and investment towards identifying new distribution avenues as well as strengthening the existing ones, said Mr Mittal.