‘Millennials bought 44 per cent of total policies sold by LIC in current year till October’

TC Susheel Kumar, Managing Director of Life Insurance Corporation (LIC), says the insurer has increased its market share by 6 per cent this year despite tough competition from private sector players. In an interview to GEORGE MATHEW, Kumar said millennials account for 44 per cent of the new policies sold by LIC. Edited excerpts:

How are you taking on competition from private sector players?

Our market share in premium (new business) was 66.5 per cent as of March 2019. But on September 30, it touched 72.5 per cent. We have regained 6 per cent market share in six months time. In October, our market share in policies was as high as 78 per cent. The share has gone up in the individual segment. We’re showing good growth in single and non-single premium segments. Earlier single premium was taking a larger portion.

How are millennials or young population looking at the insurance sector?

In the current year till October, we sold 1.04 crore policies. Out of this, 26 lakh plus policies were sold to people who are less than 25 years old. Another 18 lakh policies were sold to people between 25 to 30 years old. If you look at people between 30 and 35 years old another 17 lakh policies. We have sold 44 lakh policies to people below 30 years old, or millennials. That’s nearly 44 per cent of policies. They are coming. If you ask me whether this is adequate, well the number outside (is more)… we have to do a lot of work. If you look at the agents who are recruited, about 30-35 per cent are millennials. That may be also a good connect. Getting people early is always advantageous. Millennials can be from rural areas also … need not be from urban areas.

Are you divesting your stake in UTI Mutual Fund?

We’re not completely divesting our stake. The regulations say that it has to be brought down below 10 per cent.

Are you hiking premium in Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJBY)?

Ultimately it depends on the claim experience. It’s the government which is paying the premium. We don’t get any profit out of it. We run the scheme. They have formed a committee and it has to recommend it.

Is there any progress on listing of LIC?

The government has to decide on that issue.

What’s the share of online premium collection?

About 20-30 per cent of the premium collection is through online route. If I add the agents’ offices, it will be around 50 per cent.

The life insurance industry has been doing well despite the slowdown in the economy. What’s driving the sector?

Right from April, the insurance industry has been showing a fairly good growth. And cumulative from April every month it has been growing. We’re growing faster than the industry. Currently, LIC is showing a growth rate of 37 per cent whereas the industry is 31 per cent and private companies are showing 19 per cent as of October. It (slowdown) should not affect the insurance sector. People look for safer investment … safer options when there’s trouble in the market.

LIC seems to have stepped up hiring of agents. What’re your plans?

We’re serious about addition of agency force. We have added about a lakh of agents in the current year. We have around 11.8 lakh agents now. We have started sending them to institutions like IIM for training.

After the acquisition of IDBI Bank, how are things taking shape?

It was always LIC’s desire to have a bank as we have other subsidiaries for mutual fund, housing finance and credit card. We look at the addition of the bank as a benefit which can give a lot of synergy to LIC and our subsidiaries. We’re looking at bancassurance very seriously. Currently, they have sold about 50,000 policies and Rs 400 crore premium. They are also collecting renewal premium in their outlets. IDBI Bank doesn’t report to LIC. We have a board membership. It’s a board-driven bank. We don’t get involved in micro management.

What are your hiring plans this year?

We’re hiring around 16,700 people this year, including clerical and officers’ categories. This is about 13-14 per cent of our current work force. We have around 8,000 development officers coming in a month’s time. We have already done the exams for 3,000 clerical staff. We have already recruited 600 class one officers.

What’s your stock market strategy?

Whenever the price is attractive, we always tend to buy. Whenever the price is good to sell, we sell. We made a profit of over Rs 14,000 crore till November 15 this year.