SBI Life to slash premium for term insurance plans

Vijay C Roy

Tribune News Service

Chandigarh, November 20

To compete with rivals, SBI Life Insurance will reduce premium rates for its term plans. The announcement in this regard is likely to be made by December. The premium revision will depend upon the age of insured person and the period for which the policy has been subscribed.

“We keep on reviewing premium after every 4-5 years, based on mortality experience. The health status of the target age group who opt for term insurance has improved due to high awareness level. Keeping all these factors in mind, we have decided to reduce the premium by December this year,” said Arijit Basu, MD & CEO, SBI Life Insurance, who was in the city today.

He said they were banking on physical and digital expansion to strengthen their presence in the domestic market. “We have around 765 branches across the country and we intend to open 35 more soon, taking the total tally to 800. The expanded presence will give us exposure to new areas. As far digital infrastructure is concerned, we are continuously investing in IT. Out of the total expenditure, 25% goes to IT,” he added.

The investment in IT is likely to bring down the customer acquisition cost besides facilitating certain procedures. The bank assurance business contributes 65% of the total sales, while agent sales contribute 30% of the total business. The rest are other channels and small distributors.

In the first half of the current fiscal, individual new business has grown by 45%. The company has sold over 6,83,000 policies to individuals. In terms of profitability, for the half year the company has grown at 26%.

He said, “Chandigarh is one of the prime centres for us. Overall, SBI Life has been performing very well with an overall 48.1% growth in our rated individual new business premium for YTD Sep FY17-18 as compared with the same period last year. Through this newly launched office, we aim to further smoothen the functioning of business operations, enhance customer services and showcase our offerings to existing and potential customers in the region.”