Kotak Life Insurance looking to raise term premiums: MD Mahesh Balasubramanian
MUMBAI: Private life insurer Kotak Life Insurance on Wednesday said it is looking at raising term insurance premium rates and will soon file a new product with insurance regulator IRDAI.
The insurer's Managing Director Mahesh Balasubramanian said that insurers and reinsurers have been affected globally due to the pandemic and this has caused a realignment of underwriting norms and pricing of products.
A lot of insurance companies have increased the premium on term insurance products due to the higher number of claims in the past few months. "Our last price increase (in term insurance premiums) happened in April last year. We will be assessing the situation and will be filing a product (with IRDAI). Rather than saying a hike, let me put it this way that our pricing will align with the new reality," Balasubramanian said during a virtual event.
However, he did not specify the quantum of the hike the insurer is planning to make. Balasubramanian said the pandemic has resulted in an unprecedented level of mortality across the globe. "There is a realignment of the underwriting in reinsurance because reinsurers have really lost a lot of money in payments of settlements of claims and therefore, they are under the pressure to make sure that there is a price revision happening and there are also stricter norms for underwriting," he added.
The insurer's total new business premium grew 37 per cent to Rs 3,376 crore in April-November 2021. Its individual business renewal premium registered a growth of 20 per cent to Rs 3,002 crore in the same period.
During the first half of the financial year 2021-22, the insurer settled 62,828 claims worth Rs 1,230 crore. Its solvency stood at 2.61 in H1 FY2022.