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Analysis of the life insurance market in India

Release date 23.10.2020

Number of pages 127

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The relevance of research

Life insurance is one of the key mechanisms for protecting property interests and financial planning of people. Life insurance is aimed at financial and social protection of the population through the organization of a comprehensive system of material support in the event of various events related to life, health, disability or other events that can lead to a significant deterioration in the personal or family budget, a decrease in living standards

Purpose of the study

Analysis of the state of the life insurance market, assessment of the market size, analysis of competitors, as well as identification of factors affecting the life insurance market

Content

Chapter 1. Overview of the Indian Life Insurance Market in India

1.1. Description of life insurance
1.2. Main characteristics of the market
1.3. Dynamics of the volume of the Indian life insurance market 2017-2019 Potential market capacity
1.4. Dynamics of the market volume by types of insurance 2017-2019 Potential market capacity:
1.4.1. Cumulative life insurance (CLS)
1.4.2. Investment life insurance (LIS)
1.4.3. Accident and sickness insurance in life insurance (NS and sickness in SL)
1.5. Current trends and development prospects of the studied market
1.6. Assessment of factors affecting the market
1.6.1. Social factors
1.6.2. Technological factors
1.6.3. Economic forces
1.6.4. Political factors
1.6.5. Conclusions about the influence of factors on the market
1.7. Market structure by types of life insurance
1.8. Analysis of sectoral indicators of financial and economic activity
1.9. Life cycle stage of the life insurance market

Chapter 2. Analysis of competitors TOP 10

2.1. The level of competition in the market
2.2. Major players in the market
2.3. Market shares of the largest competitors
2.4. Analysis of the range of types of life insurance
2.5. Channels for promoting the main competitors by types of life insurance
2.6. Analysis of the best practices for promoting the life insurance of the main competitors
2.7. Conditions for the provision of life insurance services of the main competitors
2.8. Strengths and weaknesses of competitors

Chapter 3. Consumption Analysis

3.1. Market saturation
3.2. Key consumer trends in India
3.3. Estimation of the consumption of life insurance services by type (life insurance, life insurance, health insurance and illness in life insurance) per capita
3.4. Portrait of the target audience (TA) of life insurance services by types (life insurance, life insurance, health insurance and illness in life insurance)

Chapter 4. Regulation of the industry by the state

Chapter 5. Analysis of the industry in a crisis

Chapter 6. Assessment of the current investment climate in the industry and its forecast until 2024

Chapter 7. Forecasts and conclusions

7.1. Barriers in the market
7.2. Prospects and market growth drivers
7.3. Forecast of market development until 2024 by types of life insurance
7.4. Recommendations for further development in the market
7.5. Key findings from the study

Research excerpt

Chapter 1. Overview of the Indian Life Insurance Market in India

1.1. Description of life insurance

According to the classification of the All India Union of Insurers, life insurance programs can be divided into the following types:
- accumulative life insurance;
- pension life insurance;
- investment life insurance;
- Risk life insurance.

Cumulative life insurance (CLI) is a financial product that combines life and health insurance, as well as a program for accumulating, preserving and increasing capital. The essence of this product is to ensure the financial security of a person and his family in case of unforeseen situations, such as death or disability, as well as receiving the accumulated amount together with investment income at the end of the contract in full or in the form of rent. Compared to risk life insurance, cumulative life insurance provides an opportunity not only to insure life, but also to achieve long-term financial goals for yourself or your loved ones.

Categories of people who are interested in endowment life insurance:
- a family member who brings the main part of the income to the family budget. This person is the breadwinner of the family and it will be better if he is insured;
- parents who decide to create capital for their children (for adulthood, education or other purposes);
- a person who wants to form savings upon retirement;
- those who cannot discipline themselves, who find it difficult to regularly save, save and invest money, but who care about their financial future and the protection of their loved ones;
- people who need guarantees for the safety of their capital.

Starting from the first installment under the contract, the client receives insurance coverage:
- for the risk of ""survival"" - a guaranteed payment of savings that will be returned to the client in the future at the end of the insurance period;
- for the risk of ""departure"", a guaranteed payment to heirs or beneficiaries under the law (beneficiaries) in the event of the death of the insured person.

HOA policies are concluded for periods ranging from one year to 20 years or more. The sums insured for these two main risks may be equal or different, and will be the higher, the higher the premium. This ensures comprehensive insurance protection: the client saves money, and at the same time, his life is insured.

Pension life insurance is a financial product in which the client determines the amount of additional (to the state) pension that he plans to receive, pays contributions and receives a formed pension reserve by the retirement age or later. The client can choose payment periods:
- life pension, this is an option that allows you to receive an additional pension on a par with the state pension. As part of the life pension, you can choose a guaranteed payment period, within which, in the event of the death of the client, an additional pension will be paid to the beneficiary designated by him. Or you can make your pension fully inheritable by your spouse, in which case, even if the recipient of the pension passes away, his spouse can continue to receive the pension.
- a fixed-term pension (temporary pension) allows the client to receive pension benefits, but only for the period chosen by the client.

An important difference between pension life insurance and programs of non-state pension funds is the presence of additional options: exemption from paying contributions (in the event of a complete loss of the client’s ability to work, the insurance company itself will make contributions for it), additional payments to beneficiaries in the event of death and others.

Investment life insurance is a financial instrument that can provide a client with an income from investments while guaranteeing the safety of financial investments. In investment life insurance programs, the amount of money invested by the client is divided into two funds: guarantee and investment (risk). The purpose of the guarantee fund is to guarantee the return of the deposited capital in any situation on the stock market. The investment fund provides profitability on the product by participating in the dynamics of the selected underlying asset (there are many of them, for example, gold, oil, RTS index). A distinctive feature of ILI programs is the possibility for the insured to choose an investment strategy for placing the market part of the paid contributions from the options proposed by the insurer.

On the one hand, this is a product that allows you to receive investment income, on the other hand, the insurance component gives the product a number of beneficial advantages that are not available for other investment instruments: preferential taxation of product income, customer life insurance protection and a special protective legal status of investments.

Risk life insurance implies insurance coverage in the event of adverse events related to the life and health of the insured person. Insurance protection - the readiness of the insurance company to provide the client with material security - insurance payment in the event of an insured event.

The mechanism of risk life insurance programs does not provide for the creation of savings, insurance payments are provided only in the event of adverse events. Risk insurance programs with relatively small contributions allow you to get a fairly high insurance coverage. The policy can be concluded for a period from one year to a lifetime, with the payment of contributions at a time or on a regular basis (monthly, quarterly, every six months, once a year). At the same time, the client can independently determine the amount of the contribution and the desired amount of insurance coverage based on their needs.

1.2. Main characteristics of the market

Consider the main characteristics of the Indian life insurance market.

The life insurance market in this study refers to the totality of enterprises providing life insurance services; enterprises that form the offer of this market; consumers using the above services, forming demand; intermediaries selling life insurance products; as well as their relationships arising between sellers, intermediaries and consumers of life insurance services within the geographical limits of India.

Life insurance is the largest type of insurance in India. According to GidMarket calculations based on data from the Bank of India, its premium share in the total insurance market in 2017 was amounted to ...
...

The life insurance market was affected by the introduction in 2019. the requirements of the Bank of India for life insurance in order to combat misselling, as well as new standards for the work of life insurers developed by the Air Force. Both regulations significantly tightened the rules for the sale of investment insurance products.
...

During the analyzed period, the process of amalgamation of insurance companies continued, both in terms of the size of the authorized capital and in terms of the volume of premiums.
...

1.3. Dynamics of the volume of the Indian life insurance market 2017-2019 Potential market capacity

Consider the volume dynamics of the life insurance market.

Diagram 2. Dynamics of the volume of the life insurance market, 2017-2019

Potential capacity of the life insurance market
Potential market capacity - the maximum possible volume of sales of products or services on the market, when all potential consumers purchase goods, based on the most possible level of consumption.

Potential market capacity is an indicator in marketing that shows the limit of the market, its potential maximum. The potential market capacity has no actual connection with the concept of the real market volume, but only shows the maximum market in ideal conditions.

Forecasting the potential market capacity is a hypothesis about the possibility of a sales volume that could be achieved if each potential consumer of a product were a real consumer, used (used) a product or service at every opportunity to use it, without limitation, and at every use, used to the maximum extent possible.

In this case, the potential capacity of the life insurance market is the maximum possible market size, which is determined on the basis that all potential consumers use the product. Those. this is the potential market size, taking into account all existing and latent demand, while the potential demand is satisfied only with the use of life insurance products for the year.

Based on the calculations of the potential capacities of the accumulative, investment and accident insurance markets in the relevant sections of the study, the potential volume of the life insurance market is estimated at … trillion Rs. in a year.

The potential market capacity shows that the actual size of the life insurance market is very far from reaching the maximum/potential market capacity.

Achieving the potential capacity of the life insurance market and its qualitative development is constrained by restrictions on the effective demand of the population, as well as knowledge about the product and consumer preferences.

1.4. Dynamics of the market volume by types of insurance 2017-2019 Potential market capacity:

1.4.1. Cumulative life insurance (CLS)
Let's consider the dynamics of the endowment life insurance (CLL) market volume.

Endowment insurance is a more mass and socially oriented product that provides maximum consumer value. While credit insurance provides only protection against risks, and investment insurance is more aimed at generating profitability, endowment insurance combines two main advantages of life insurance: protection in the form of a large insurance coverage and the formation of personal capital, which is becoming relevant for people especially in periods of crisis.
...

Unlike ILI, which is more in demand among people of mature age who already have savings and is a product with a one-time contribution (the client buys a policy for a long period and invests the entire amount at once), ILI has regular contributions, thanks to which a person can save literally from zero for delayed financial goals, so this product is suitable not only for middle-aged and older people, but also for the younger generation.

The growth in demand during the analyzed period for life insurance products is associated with:
- decrease in inflation to lows over the past few years, which stimulates long-term savings;
- reduction of rates on ruble deposits in banks in 2016-2019;
- flow of clients and their funds from ILI;
- uncertainty in 2016-2017. with the fate of pension savings, which partly contributed to the growth of the population's interest in funded insurance products;
- increasing awareness of potential customers about the product;
- increasing the penetration of life insurance products into the market through the banking sales channel;
- the ability to use the tax deduction and thereby actually increase the profitability under the contract;
- life insurance cannot be foreclosed;
- there is an opportunity to “fix” the state of health, and, consequently, the rate under the policy for 10-20 years in advance.

HOA, on the one hand, has the minimum guarantees that are spelled out in the contract, and on the other hand, provides an annual additional investment income. The longer the endowment life insurance contract, the more the above values are felt by the client.

Potential capacity of endowment life insurance market

According to IC Sberbank Life Insurance, in the future, the main volume of the life insurance market will fall on accumulative types of insurance, the volume of the life insurance market in the next few years may grow by about 10 times, but this forecast concerns the development of the real market volume.

Let's evaluate the potential capacity of the endowment life insurance market.

Potential market capacity is the maximum volume of sales that can be achieved within a certain period. Potential market capacity is an abstract, theoretical value when consumers buy only a given product or service (do not purchase substitute goods), and use it to the maximum extent. Knowledge of potential capacity is necessary for companies to understand the possibilities and degree of market saturation.

The UA policy includes two components: protective and cumulative. The product is designed in such a way that contributions can be paid in installments (for example, annually, monthly), accumulating for a financial purpose.

1.4.2. Investment life insurance (LIS)
Investment life insurance (ILI) was the driving force behind the growth of the life insurance market for several years until 2019.

Let's analyze the dynamics of the ILI market volume for 2017-2019.
...

Potential capacity of the investment life insurance market

ILI is an investment instrument with which the policyholder invests in securities. Thus, the insured becomes a participant in the stock market. Unlike buying stocks or bonds on your own, taking out an appropriate policy automatically means protection against the risk of loss.
...

To assess the potential capacity of the investment life insurance market, a hypothesis is put forward that consumers use only the considered product in its maximum quantity for a certain period of time - a year, i.e. all available bank deposits in India will be directed to the investment life insurance market.
...

1.4.3. Accident and sickness insurance in life insurance (NS and sickness in SL)

Consider the dynamics of the market for accident and illness insurance in life insurance.

Accident and health insurance has established itself in India as a fairly common and sought-after insurance in the form of individual and collective insurance.
...

Chart 5. Dynamics of the volume of the accident and health insurance market in life insurance, 2017-2019

Potential capacity of the accident and health insurance market in life insurance

Let's assess the potential capacity of the insurance market for NA and diseases in the life insurance.

Potential market capacity - this capacity is determined from the approach that buyers are committed to a product or service. That is, it shows that society consumes and uses this product or service to the maximum (and does not use substitute goods).
...

1.5. Current trends and development prospects of the studied market

Key trends in the life insurance market include:
...

Prospects for the development of the life insurance market:
On the one hand, the economic crisis, which was catalyzed by the coronavirus pandemic, will lead to a decrease in interest in investment and long-term savings due to a decrease in purchasing power in the short term, on the other hand, due to a decrease in income, some Indians are becoming aware of the need to create a financial in the future, which may stimulate the development of endowment life insurance programs, which are now a driver in this market.

If we talk about long-term prospects, then India is gradually moving along the path of developed countries, where cumulative life insurance covers 80-90% of the population. Almost every European or American family uses savings programs, while in India the penetration rate of these products does not exceed 1%. Therefore, the low base effect, along with the increasing attention of people to lifelong life products, suggests the possibility of market growth in the lifelong life segment.
...

With the active development of insurance products with a service component, insurers simultaneously pursue three goals: meeting new customer needs, increasing the customer value of the product, and increasing the number and quality of communications with the customer, because life insurance programs give, as a rule, only two obvious reasons for contacting the client: payment of premiums and insurance payment (when the client receives survival savings and is ready to say goodbye to the insurer). Between these events, the client may not remember the insurance company, which does not have the best effect on his loyalty. Therefore, insurers increase the frequency of contacts with customers, offering them various useful services within the framework of life insurance contracts. Companies intend to help customers solve issues that they face on a regular basis. This can be a tax deduction, legal support, educational concierge within the framework of children's savings products, a number of medical concierge services: telemedicine consultations, regular health checks (check-ups), a second medical opinion and other services.

In the coming years, online sales in life insurance will develop. Already, more than 90% of Indian insurance companies use Internet solutions to some extent when concluding OSAGO, motor hull insurance, property insurance, VHI and other contracts. More than half of insurers allow you to apply for remote settlement of an insured event. Clients can upload photos of damaged property and photocopies of certificates to mobile applications, instant messengers and a personal account on the website.

1.6. Assessment of factors affecting the market

1.6.1. Social factors
Let's consider the main social factors influencing the life insurance market and, accordingly, demand.

Real disposable income of the population
The real disposable income of the population is one of the most important factors influencing the development of the Indian economy in general and each industry in particular.

If the real incomes of Indians are growing, then all sectors of the economy are developing, including the life insurance market.

Population
...

1.6.2. Technological factors
IT technologies in life insurance
As a technological factor, information technology has become the most widespread in the life insurance industry, this is due to the fact that this field of activity is one of the information-saturated and, as a result, information-dependent industries.

Large amounts of information, high requirements for accuracy and reliability, the need for effective analysis of the financial condition of customers are the main reasons for the rapid growth of modern information technologies in the insurance industry. Companies are actively implementing various information products that are designed to reduce costs, allow more efficient conclusion of contracts, sales, evaluation and settlement of insured events.
...

The development of a modern IT infrastructure is one of the factors for increasing the competitiveness of insurance companies.

Development of the information infrastructure market
For the development of online services in life insurance, which are becoming increasingly popular, it is necessary to develop the information infrastructure market. In addition to the overall increase in the penetration of online services into our lives, the growth in demand for them has increased due to the COVID-19 pandemic, due to the fact that the service could only be received online (until the situation stabilized).
...

Increasing internet speed and availability
To ensure the required quality of online services and life insurance products, it is necessary to meet certain requirements for data transfer speed.
...

Technological development of information infrastructure opens up new opportunities for life insurance companies.

There are many opportunities for business in the life insurance market. The introduction of IT technologies, online sales, CRM systems, SAP, mobile applications can increase sales, improve the quality of customer service, and reduce costs. In the framework of intense competition, the introduction of the latest technologies will allow companies providing life insurance services to remain at a competitive level.

The structure of the study does not consider the impact of climate change as a factor affecting the life insurance market, however, this factor is important in the global insurance market and more and more country regulators in the world have turned their attention to this risk.

Climate risks
According to the Bank of India, a growing number of foreign insurance supervisors believe that climate risks (physical and transition risks) should be considered in the context of the main risks to which insurers are exposed due to operating, investing, underwriting activities, as well as the impact of such risks on strategy and reputation.
...

1.6.3. Economic forces
The coronavirus pandemic, the decline in oil prices had an impact on the economic factors of the development of the world economy and the Indian economy in particular. Let's consider the main economic factors that influence the development of the life insurance market.

Dynamics of India's Gross Domestic Product
The dynamics of GDP is a determining factor in the development of the country's economy, it forms the main trends in consumer effective demand and economic activity.
...

Diagram 10. Dynamics of India's GDP, 2012-2019, % to the previous year

Decline in oil prices and the rupee
The decline in oil prices will have a multidirectional impact on the life insurance market in India, on the one hand, with a depreciation of the rupee and an outflow of investments from federal loan bonds (OFZ), and on the other hand, with an increase in demand for insurance products with capital protection.
...

Decrease in ILI sales
...

Closing of sales and service offices
The coronavirus pandemic has led to the temporary closure of sales and service offices of insurance companies and their intermediaries, the reduction of working bank offices - the main sales channel for life insurers, which is one of the main reasons for the decrease in insurance premiums in 2020. along with a general decrease in the solvency of citizens due to a decrease in real disposable income. During the period of self-isolation, clients reduced the number of visits to the offices of credit institutions to the most necessary ones. This factor has a negative impact on the life insurance market.

Increasing interest in life and health insurance products with additional service medical components

With a general decline in demand, there is a noticeable increase in the interest of Indians in products related to the protection of life, health and medical care. According to Absolut insurance, earlier Indians were more concerned about insuring property risks associated with the loss of tangible benefits - real estate, a car, etc., while health faded into the background.
...

1.6.4. Political factors

The following political factors are currently present in the life insurance market, which have a direct impact on the life insurance market. The adopted measures of state regulation, but coming into force later, as well as those that are under discussion, are discussed in chapter 4 of this study.

Increasing consumer awareness of the features of life insurance products and reducing misselling
...

Financial Ombudsman Service
...

Raising the requirements for the minimum amount of authorized capital
...

Government support measures for insurance companies during the COVID-19 pandemic
March 20, 2020 The Bank of India has relaxed the requirements for the timing and volume of mandatory reporting for insurance companies. Until June 30, it will not punish market participants for violations in this area.

The Central Bank will also temporarily not apply sanctions to insurers that cannot satisfy their customers' claims for payments on time due to quarantine and restrictions in certain regions.

Law on the liberalization of online sales of life insurance policies through brokers and agents adopted
The State Duma passed in the final, third reading amendments to the law on the organization of insurance business in India and the law on OSAGO, which allow the online sale of business risk and life insurance policies, as well as policies for other types of insurance through brokers and agents.
...

The adoption of this law was expected by all insurers, and it will certainly have a positive impact on the development of the insurance market in general and the life insurance market in particular. online sales will drive the growth and development of the market in the future.

1.6.5. Conclusions about the influence of factors on the market

Table 1. STEP analysis of factors influencing the life insurance market

Macro-environment factors have a more negative impact on the life insurance market; a group of economic, social and political factors has a decisive influence on the development of the market.
...

Market structure by types of life insurance

Since 2017 The structure of the life insurance market has changed, …
...

According to the Air Force in 2019. the volume of the CU market amounted to … billion Rs., an increase of …%.

1.8. Analysis of sectoral indicators of financial and economic activity

According to GidMarket, at the end of 2019. Gross margin of the life insurance industry in India amounted to …%, ...
...

Values of current liquidity in 2017-2019 in life insurance in India testify to the low solvency of the industry: significantly below the “2” mark.
...

At the same time, indicators of sectoral values of current and adjusted net liquidity, financial stability in the aggregate indicate the ability of most enterprises to repay current debt at the expense of existing (current) assets.

1.9. Life cycle stage of the life insurance market

Consider the life cycle model of the life insurance market. Strategic management uses the market life cycle model, which was proposed and discussed in detail by Michael Porter in 1980. The stage of the market life cycle affects the level and strength of competition, and also establishes certain rules for competition in the industry. In order to develop and implement an effective strategy in the market, it is important for enterprises to understand at what stage of development the market is.
...

The life insurance market is at the beginning of the life cycle stage - maturity. At this stage, the market is stabilizing, growth rates are slowing down, and competition is growing. The period of development of product differentiation begins.

At the maturity stage, enterprises focus on maintaining a stable position in the market and usually follow several strategies:
- cost leadership strategy, when the company directs its efforts to reduce costs;
- differentiation strategy, when the company focuses its efforts on the quality of the product;
- leadership strategy in a certain segment.

Chapter 2. Analysis of competitors TOP 10

2.1. The level of competition in the market

Let's assess the level of competition in the Indian life insurance market.

The level of competition is estimated using the concentration coefficient and the Herfindahl-Hirschman index.

A modern assessment of the monopoly position of insurers in the market is calculated using market shares in premiums of life insurance companies and the concentration ratio (CR).

The Herfindahl-Hirschman Index (HHI) is a general measure of market concentration that is used to determine market competitiveness.

The closer the market is to monopoly, the higher the market concentration (and the fewer competitors).
...

From which it follows that the life insurance market in India belongs to a moderately concentrated market.

2.2. Major players in the market

The largest players in the life insurance market in India include:
- LLC SK ""XXX"";
- LLC ""XXX"";
- LLC ""XXX"";
- OOO SK XXX;
- LLC ""XXX"";
- LLC SK ""XXX"";
- LLC ""XXX"";
- LLC ""XXX"";
- LLC ""XXX"";
- OOO SK XXX.
...

2.3. Market shares of the largest competitors

According to GidMarket, the leader of the life insurance market in India is SK XXX life insurance, which occupies …% of the Indian market in 2019, …

Third place is…

Profiles of major players
...

According to the Bank of India, the total revenue of the TOP 10 largest companies providing life insurance services in India in 2019 amounted to...

Diagram 20. Dynamics of the total revenue of the largest participants in the life insurance market (TOP 10) in India, 2017-2019

Lower growth rates of the volume of insurance premiums of the largest operators in 2017-2018. With regard to the overall dynamics of the market volume, we can state the processes of concentration of moderate strength taking place in the Indian life insurance market.

2.4. Analysis of the range of types of life insurance

Let's analyze the range of types of life insurance in the TOP 10 insurance companies (IC) in the market under consideration.

The distribution of programs by types of life insurance was carried out in accordance with their positioning by insurance companies. It should be noted that some investment insurance programs or a symbiosis of endowment and investment life insurance are positioned by insurance companies as endowment life insurance programs. Many ICs separately position NSW programs with service medical components as life and health insurance programs; this group also often includes NS and illness insurance programs. Some insurance companies separately position travel insurance.
...

Among the Top 10 life insurance insurers on the mass market (B2C), investment, endowment, life and health insurance programs dominate in terms of assortment.

The largest share in the range in the TOP 10 is occupied by investment life insurance …%.
...

Decrease in consumer demand for ILI in 2019 led insurance companies to change programs for investment life insurance. Programs have become more transparent and understandable for customers.

Insurance companies offer clients ILI policies with fixed income, guaranteed and non-guaranteed.
...

In addition to regular ILI payments, programs have become shorter in duration, and investment strategies have become more diverse.

Another ILI trend is the ability to invest in foreign currency.
...

Insurance companies include the following services in the programs: check-up in India and abroad, organization of treatment in India and abroad (through partners), second medical opinion, travel and accommodation arrangements, Concierge Service, telemedicine. Almost all major insurers in 2020. included the risk of coronavirus in life and health insurance programs. Such insurances may also provide benefits in case of involuntary loss of work or long-term sick leave.
...

2.5. Channels for promoting the main competitors by types of life insurance

Consider the structure of the sales channels of the main competitors in the context of types of life insurance: life insurance, life insurance, health insurance and illness in life insurance at the end of 2019.

NSJ
According to the All India Insurers Union in 2019. TOP 10 endowment life insurance companies (LIC) include:
...

Diagram 23. Structure of sales channels for life insurance of the main competitors (by premiums), 2019, %

NSJ
The market leader - IC Sberbank life insurance sells 100% of the life insurance policies through the sales and service offices of Sberbank PJSC.
...

ILI
Based on the data of the All India Union of Insurers, 11 life insurers are among the largest investment life insurance companies, 11, tk. Ingosstrakh-Life and SOCIETE GENERAL Life insurance occupy approximately the same positions:
...

Third share in sales in TOP 11 in 2019 belonged to - other legal entities (except for insurance, credit organizations, insurance brokers, car dealerships, leasing companies, tour operators and travel agents, legal entities whose main activity is the activity of insurance agents) which accounted for …% of TOP 11 insurance premiums.
...

NS and diseases in the SF

Consider the sales channels of the TOP 11 life insurers in 2019. on NS and B in SZh.

According to the All India Union of Insurers, the largest life insurers in terms of NA and B in SI include:
...

The TOP 11 insurance companies use ten sales channels in their sales activities, more than for HOA and ILI.
...

Insurance agents - individuals and individual entrepreneurs occupy ...
...

Most often, TOP 11 insurance companies use sales through credit organizations, their own sales offices and insurance intermediaries (individuals or legal entities).
...

2.6. Analysis of the best practices for promoting the life insurance of the main competitors

To determine the companies that work best in the market in terms of sales, we will analyze the TOP 10 life insurers.

Main sales of TOP 10 life insurers (collection of premiums from all types of insurance) in 2019 passed through the channel - credit organizations.
...

In 2019 the third place in the collection of TOP 10 premiums was taken by the sales channel - other legal entities. …

2.7. Conditions for the provision of life insurance services of the main competitors

...

2.8. Strengths and weaknesses of competitors

We will analyze the strengths and weaknesses of competitors.

The diagram shows the positions of companies depending on the increase in sales (collected premiums) in 2019. in relation to 2018 and increase in market share in premiums, the market share of companies at the end of 2019 is indicated in brackets.

Competitors with high market share and high growth rates have a big impact on the market. …
...

Chapter 3. Consumption Analysis

3.1. Market saturation

Let's evaluate the Indian life insurance market saturation index.

The dynamics of the number of insured persons under life insurance is as follows…
...

Diagram 35. Number of concluded life insurance contracts, 2017-2019, million

According to Rosstat, the population of India is 146,7 million people. Thus, the saturation of the life insurance market in terms of the number of insured persons is currently …%.

3.2. Key consumer trends in India

2019 was marked by a change in the driver of the insurance market from investment to endowment life insurance. The main reason is the change in consumer preferences in favor of life insurance due to customer disappointment with the profitability of life insurance products for which contracts have already ended, as well as the introduction by the Bank of India of standards for the sale of life insurance policies, making sales of the product transparent, which also affected the reduction in fees.

According to a PWC study conducted in 2019, the main trends in changing preferences of the Indian consumer include:
rapid growth of online sales.
demand for digital and physical shopping experiences.
shift towards digital communication channels.

3.3. Estimation of the consumption of life insurance services by type (life insurance, life insurance, health insurance and illness in life insurance) per capita

Estimation of per capita consumption of life insurance services in India was made by GidMarket on the basis of the ratio of the market size of the corresponding type of life insurance to the population of India.

The dynamics of consumption of endowment life insurance products in India is growing rapidly.

3.4. Portrait of the target audience (TA) of life insurance services by types (life insurance, life insurance, health insurance and illness in life insurance)

Let's consider the portraits of the target audience of life insurance services in the context of life insurance types: life insurance, life insurance, NS and B in life insurance.

NHS
According to the purpose of savings, the target audience can be segmented into:
- The most common purpose of savings is a financial reserve for unforeseen circumstances.
- The second most popular goal of savings is financial support for children.
...

ILI
According to research by IC Rosgosstrakh Life, which were conducted in the fall of 2019. accumulated funds people preferred to keep:
- in cash
- in banks

The goal is to receive additional income by investing savings.

Women are more conservative in terms of the choice of investment instruments: they accumulate funds mainly in cash or on bank accounts. These instruments are also the most popular among men, but they also use others more often than women. At the same time, women are more likely to save money for short-term goals, and men - for a rainy day.
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NS and diseases in the SF
Increased health concerns and declining incomes have changed customer preferences during the coronavirus pandemic. Life insurance for the last three months of 2020 was gaining popularity.

Policies for NS and diseases in the SJ protection against coronavirus and the like are in demand.

Chapter 4. Regulation of the industry by the state

Let's consider the main directions of regulation of the industry by the state, which are currently under discussion and will have an impact on the life insurance market in the future. The current directions of regulation of the activity of life insurance IC are presented in paragraph 1.6.4. political factors.

From September 1, 2020 in case of early repayment of the loan, banks will be required to return to borrowers part of the paid insurance premium

New requirements for financial stability and solvency of insurers

The concept of guarantee in the life insurance market

The Bank of India will continue to develop the Concept of regulation of insurance accompanying a mortgage contract by force of law

Development of a bill regulating the work in India of branches of insurance and reinsurance companies from other countries - members of the WTO

Admission of insurers to the management of pension savings of Indians

Chapter 5. Analysis of the industry in a crisis

April 19 BCG Partnered with Romir India Consumer Trends Survey ""COVID-1 - Consumer Sentiment Snapshot #2020: Indian Consumers - The New Reality""

In the life insurance market, there is a noticeable increase in people's interest in opportunities, if not to protect themselves from coronavirus, then to minimize its consequences, including by purchasing an insurance policy. Almost all major insurers in 2020. included the risk of coronavirus in life and health insurance programs. Such insurances also provide payments in case of involuntary loss of work or long-term sick leave. Potential policyholders are more interested in programs with medical service components (check-up, telemedicine consultations, treatment organization, etc.)
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Indians of working age who have a valid indefinite employment contract can buy such a policy. Insurance will protect against involuntary job loss - that is, the termination of the enterprise, dismissal due to staff reduction. Some insurers recognize the employer's move to another region as an insured event. As a rule, to obtain insurance, you must have at least a year of work experience, and at the current place of work - at least three months.
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During the coronavirus pandemic, in search of answers on how to increase consumer confidence and stimulate demand for goods and services in general, questions of trust between consumers and the seller (in the person of the manufacturer or seller) came to the surface. Here you can draw an analogy with the loss of customer confidence in ILI even before the pandemic. Analysts and consulting firms are now pointing out that staying in close contact with their customers is definitely helpful in restoring and increasing customer confidence. This can be implemented through communication in social networks, chat bots, applications, company websites.

Chapter 6. Assessment of the current investment climate in the industry and its forecast until 2024

The most significant negative factors
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The most significant positive factors
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Chapter 7. Forecasts and conclusions

7.1. Barriers in the market

Let's analyze the main barriers that exist in the life insurance market.
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Recently, there has been more and more discussion about the need to create a legislative framework in India for the emergence of shared life insurance products, which is very similar to Western Unit-linked products.

However, before the implementation of this plan, it is necessary to adjust the legislative norms, including tax and insurance legislation. The emergence of unit-linked (share insurance) products in the Indian life insurance market would be very timely now, this product would take its rightful place in the line of investment products.

7.2. Prospects and market growth drivers

Endowment life insurance has become a new growth driver for the life insurance market, which covers a larger number of the population, providing an opportunity to accumulate savings, including using investment tools. The coronavirus pandemic has changed the minds of potential customers and, as studies by consulting agencies and life insurers show, an increasing number of people are thinking and making decisions about the need for savings. Programs with various service components (check-up, telemedicine, personal income tax return service, concierge service, educational services, etc.) are gaining more interest. The key task of life insurers is to make savings products as transparent, convenient and functional as possible, supplementing them with modern service solutions for health, physical well-being and longevity, as well as improving the quality of life of customers in general.

The proposal of the Bank of India to include life insurance in the state deposit guarantee system will contribute to the formation of a sustainable, transparent and organic life insurance market and will certainly increase consumer confidence in insurers' programs.

After the inclusion of life insurance in the state deposit guarantee system, the Bank of India is ready to discuss the issue of participation of life insurers in the new system of voluntary pension savings - the Guaranteed Pension Plan (GPP). The guarantee system, according to the general opinion of life insurers, should include all financial segments and have equal rights, including within the framework of participation in the pension system. The implementation of this initiative can increase the size of the life insurance market by 3-4 times according to the forecast of the ARIA.

7.3. Forecast of market development until 2024 by types of life insurance

We will analyze the market based on methods based on identifying trends over time, adjusted for expert opinion in the industry.

The following factors make it possible to predict the dynamics of the life insurance market volume:
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Consider two scenarios for the development of the life insurance industry in conditions of self-isolation due to COVID-19:

Scenario of one self-isolation (according to the Chinese release schedule);
Scenario for the introduction of two self-isolations (when repeated in autumn).
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7.4. Recommendations for further development in the market

The life insurance market in the coming years will develop due to accumulative life insurance and the increasing penetration of online sales and services. Further development of long-term life insurance in India will largely depend on the work of insurers in developing the range and content of endowment and investment life insurance products.

In the context of active promotion of substitute products to the market: bank deposits, shares of mutual funds, individual investment accounts (IIA), trust management and others, in order to attract new customers, the HOA and ILI programs should have appropriate advantages.
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7.5. Key findings from the study

In monetary terms, the volume of the life insurance market in India in 2019. was equal...
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The most important changes in the market in the near future include the introduction of the Guarantee Concept in the life insurance market, which, of course, will increase the level of confidence of potential customers in insurance companies and will have a positive effect on attracting new customers. The creation of such a system will add confidence to investors, which is confirmed by the VTsIOM study, which was conducted in the summer of 2019. more than half of Indians are ready to use a whole range of financial instruments to form savings, but only if there is a guarantee from the state. …
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According to GidMarket analysts, according to the first scenario…

According to the second scenario, if the second self-isolation is repeated in the fall, the forecast for the development of the life insurance market
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Diagrams

Diagram 1. Dynamics of the number of insurance business states whose activities are subject to licensing, units.
Diagram 2. Dynamics of the volume of the life insurance market, 2017-2019
Diagram 3. Dynamics of the endowment life insurance market volume, 2017-2019
Diagram 4. Dynamics of the volume of the investment life insurance market, 2017-2019
Diagram 5. Dynamics of the volume of the accident and illness insurance market in life insurance, 2017-2019
Diagram 6. Dynamics of real disposable income of the population in India, 2012-2019, % to the previous year
Diagram 7. Population dynamics in India, as of 01 Jan. 2012-2020, million people
Chart 8. Activities of information infrastructure enterprises in India (data processing, provision of information placement services, activities of portals in the information and communication network of the Internet), 2014-2019, billion Rs.
Chart 9. The volume of activities for the provision of data transmission services and access services to the information and communication network of the Internet in India, 2013-2019, billion Rs.
Diagram 10. Dynamics of India's GDP, 2012-2019, % to the previous year
Diagram 11. Structure of the life insurance market by types, %
Diagram 12. Dynamics of the volume of the credit insurance market (CS), 2017-2019
Diagram 13. Profitability before tax (profit of the reporting period) in the field of life insurance in comparison with all sectors of the Indian economy, 2017-2019, %
Diagram 14. Current liquidity (total coverage) in the field of life insurance for 2017-2019, times
Chart 15. Adjusted net liquidity in life insurance, 2017-2019, times
Diagram 16. Business activity (average turnover period of receivables) in the field of life insurance, for 2017-2019, days days
Diagram 17. Financial stability (security of own working capital) in the field of life insurance, in comparison with all sectors of the Indian economy, 2017-2019, %
Diagram 18. Life cycle of the life insurance market
Diagram 19. Shares of the largest competitors in the life insurance market in 2019
Diagram 20. Dynamics of the total revenue of the largest participants in the life insurance market (TOP 10) in India, 2017-2019
Diagram 21. The structure of the range of TOP 10 life insurance insurance companies in the B2C market
Diagram 22. The structure of the range of life insurance programs by types of TOP 10 life insurance companies in the B2B market
Diagram 23. Structure of sales channels for life insurance of the main competitors (by premiums), 2019, %
Diagram 24. Structure of ILI sales channels of the main competitors (by premiums), 2019, %
Diagram 25. The structure of sales channels for NS and diseases in the life cycle of the main competitors (by premiums), 2019, %
Chart 26. TOP 10 premium collection shares by sales channels, 2018-2019, %
Chart 27. TOP 10 life insurers' premium collection shares in the sales channel - credit institutions, 2018-2019, %
Diagram 28. TOP 10 life insurers' premium collection shares in the sales channel - individual insurance agents. persons and individual entrepreneurs, 2018-2019, %
Chart 29. TOP 10 life insurers' premium collection shares in the sales channel - other legal entities, 2018-2019, %
Diagram 30. TOP 10 life insurers' premium collection shares in the sales channel - legal entities (the main type of economic activity is the activity of insurance agents), 2018-2019, %
Diagram 31. TOP 10 life insurers' premium collection shares in the sales channel - own sales offices, 2018-2019, %
Diagram 32. TOP 10 life insurers' premium collection shares in the sales channel - car dealerships, 2018-2019, %
Diagram 33. TOP 10 life insurers' premium collection shares in the Internet sales channel, 2018-2019, %
Diagram 34. Map of competitors, 2019
Diagram 35. Number of concluded life insurance contracts, 2017-2019, million
Diagram 36. The volume of consumption of life insurance products per capita, 2017-2019, Rs./person
Diagram 37. Consumption of ILI products per capita, 2017-2019, Rs./person
Diagram 38. The volume of consumption of NA products and diseases in the life cycle per capita, 2017-2019, Rs./person
Chart 39 according to the first scenario (one self-isolation in 2020)
Chart 40 according to the second scenario (two self-isolations in 2020)
Diagram 41. Forecast of the size of the ILI market in 2020-2024 according to the first scenario (one self-isolation in 2020)
Diagram 42. Forecast of the size of the ILI market in 2020-2024 according to the second scenario (two self-isolations in 2020)
Chart 43 according to the first scenario (one self-isolation in 2020)
Chart 44 according to the second scenario (two self-isolations in 2020)

Tables

Table 1. STEP analysis of factors influencing the life insurance market
Table 2. Gross margin of the life insurance industry in comparison with all sectors of the Indian economy, 2017-2019, %
Table 3. Concentration ratios in the Indian life insurance market based on groups, 2019, %
Table 4. Optimal concentration ratios in the life insurance market based on groups, 2019, %
Table 5. Main companies participating in the life insurance market in 2019 Profiles of major players
Table 6. Basic information about participant No. 1 of the life insurance market
Table 7. Basic information about participant No. 2 of the life insurance market
Table 8. Basic information about participant No. 3 of the life insurance market
Table 9. Basic information about participant No. 4 of the life insurance market
Table 10. Basic information about participant No. 5 of the life insurance market
Table 11. Basic information about participant No. 6 of the life insurance market
Table 12. Basic information about participant No. 7 of the life insurance market
Table 13. Basic information about participant No. 8 of the life insurance market
Table 14. Basic information about participant No. 9 of the life insurance market
Table 15. Basic information about participant No. 10 of the life insurance market
Table 16. Range of life insurance programs TOP 10 life insurance companies in the B2C market
Table 17. The range of TOP 10 life insurance companies in the B2B market
Table 18. Conditions for the provision of HOA services
Table 19. Conditions for the provision of ILI services
Table 20
Table 21. TOP 10 market indicators
Table 22. Strengths and weaknesses of competitors, 2019
Table 23. Assessment of factors of investment attractiveness of the life insurance market

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