Life Insurance has witnessed a slow down in 2011. When we reviewed the decade of life insurance, we saw that as on August,2011, the Individual single premium was down by (-)  62.45% . The individual non-single premium was down by (-) 28.65%.

The slowdown continues. As on September, 2011 the sale of policies was 35,88,869 policies as against 55,88,804 policies the year ago. That is a 40% dip.

The insurance industry is reeling under the regulatory changes by IRDA resulting into lower margins.

Moreover, the proposed direct tax code (DTC) also is bad news for the insurance industry. From April, 2012, only term insurance will get tax benefits and the amount is limited to Rs 50000/- and clubbed with tuition fee and health insurance.

i-Life, i-Term and i-Protect online products from Aviva, Religare and ICICI are some of the achievements of the life insurance industry in this time of turmoil.

Insurance companies like LIC is seen to be safer bet than the stock markets and when the stock markets are down, the money should flow into life insurance companies. This has not happened. However the dip in the stocks is also affecting the ULIPs which had become a hot selling product after the private insurance companies set up shop in India.

The insurance industry has started focusing on traditional products and providing long term savings products.

Insurance companies are also mulling over their digital strategy to reach out to the online, young and tech savvy generation.

The growing trend of online comparison of insurance products is double edged. While it offered to provide an informed choice to the buyer, it also had information clutter and biased information which misled the consumer. IRDA has banned online comparison of insurance products to ensure a level playing field for all.

With the business becoming increasingly competitive, private insurance companies will now be forced to look at newer marketing and distribution strategies.

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