The Confederation of Indian Industry (CII) yesterday said the size of the domestic life insurance market could treble to Rs 60,000 crore by 2005 on the strength of an 18 per cent growth following liberalisation, while growth in corporate non-life premium could double to about Rs 20,000 crore.
By 2010, life insurance premium may cross Rs 1,40,000 crore, while corporate non-life premium is likely to aggregate close to Rs 40,000 crore by that period. These are estimates by a CII sub-committee on distribution and intermediaries, headed by Ashwin Parekh of Pricewaterhouse-Coopers.
The estimates on the growth of the pension scheme suggests that it will more than double to Rs 4,000 crore by 2005, and increase to Rs 14,000 crore by 2010. CII has assumed growth rates of 20 per cent to 30 per cent for the pensions business.
The number of policies in force for achieving the life insurance premium in the 10th year will be close of 180 million on the basis of the historical trends in the average policy size, the estimates say.
The CII sub-committee has assessed the size of the market by gauging the trends in the gross domestic product (GDP) and gross domestic savings (GDS).
"The life insurance premium share of GDS has traditionally been around 6 per cent. This share is assumed to increase to around 18 per cent with liberalisation. This compares favourably with the international markets like the US (24 per cent), UK (41 per cent) Netherlands (20 per cent), France (30 per cent) and Japan (31 per cent)," the sub-committee's report says.
It, however, adds that the growth will be heavily dependent on tax advantages available, likely returns and flexibility of the products. t>
