(a) whether the Government has noticed a steep decline in the sale of life insurance policies
during the last fiscal;
(b) if so, the details thereof and the reasons therefor;
(c) whether the Government has fomulated any plan to revive investor sentiment in life insurance
sector;
(d) if so, the details thereof; and
(e) the other measures taken/proposed to be taken by the Government in this regard?
Minister of State in the Ministry of Finance (Shri Namo Narain Meena)
(a) and (b): Yes, Sir. Insurance Regulatory and Development Authority (IRDA) has informed that
the life insurance industry witnessed 8.22 per cent decline in the number of new policies issued
during the last financial year 2011-12 as against the policies issued in the previous financial
year 2010-11. In terms of Premium Income generated through sale of new policies, the decline
during the Financial Year 2011-12 was 14.01%. The decline in the number of policies sold may be
attributed to IRDA’s bringing out new Regulations on the design of ULIP products in the interests
of policyholders’ welfare and general market conditions prevailing in the country.
(c) to (e): The Government has reviewed the performance of life insurance industry with the
insurance companies and the Regulator. In order to give a boost to the life insurance industry,
certain measures have been identified for action which include taxation benefits and regulatory
issues relating to product design, distribution and investment.