Life insurance industry has been growing at a steady rate. While the equity market is yet to stabilize life insurance market is consistent in its growth. With constant fluctuation in the stock markets, more people are expected to shift to the life insurance investments as mentioned by V. Viswanand- Senior director and Chief Operating Officer, Max Life Insurance. In the span of three to five years growth of 12-15% is expected in the life insurance industry added- Vishwanand.
According to him the major reason of shift towards life insurance products is as follows:
The shift from retail savings i.e from physical assets like gold/ property to financial assets
Saving financialization activated by factors like demonetisation and GST
The faster growth rate of GDP
Vishwanand says paradigm shift from physical assets to the financial asset will continue. Macroeconomic conditions globally are triggering the stock fluctuations, rupees to dollars volatility. In such a scenario, people are expected to buy life insurance products in coming quarters for assured returns. Rural sector yet needs to experience the rush in the small and medium enterprise which has affected penetration in the life insurance sector. There is still need of liquidity of saving in the rural sector as a result urban area controls the life insurance industry as conveyed by Vishwanand.