Life Insurance Demand Expected to Remain Strong in FY27: Keki Mistry
Demand for life insurance products is expected to remain healthy in FY27, supported by India’s favourable demographics, rising financial awareness and increasing focus on long-term financial planning, according to HDFC Life Insurance Chairman Keki Mistry.
In the company’s annual report, Mistry highlighted that India continued to demonstrate economic resilience despite global uncertainties, geopolitical tensions and financial market volatility. Strong domestic demand, public investment and structural reforms have supported the country’s growth outlook.
He noted that the Reserve Bank of India has projected India’s real GDP growth at 6.6% for FY27, although prolonged geopolitical conflicts and risks to energy infrastructure could affect economic performance.
The life insurance sector received regulatory support during FY26 with the removal of GST on retail life insurance products, improving affordability for customers. The adoption of International Financial Reporting Standards (IFRS) from April 2026 is also expected to improve reporting alignment with global practices.
HDFC Life continues to focus on disciplined growth, stronger risk management, diversified distribution channels and product innovation across protection, savings, retirement and wellness segments.
PhonePe Insurance Head Vishal Gupta Resigns to Launch Startup
Vishal Gupta, the head of PhonePe’s insurance business, has stepped down from his role after more than a decade with the fintech company to pursue a new entrepreneurial venture.
Gupta, who was part of PhonePe’s founding team, played a key role in building and scaling the company’s insurance operations. Before joining PhonePe, he worked with Flipkart, where he handled product management responsibilities in payments and transactions.
Following his exit, PhonePe is restructuring its insurance operations by integrating the insurance business with its consumer payments division. The combined business will be led by Sonika Chandra, PhonePe’s Chief Business Officer.
Announcing his departure, Gupta said he was returning to his interest in building new ventures, solving complex problems and creating businesses from the early stages.
The leadership change comes as digital financial platforms continue to expand their insurance offerings and explore new models for financial services delivery.
Life Insurance Surrenders Surpass Maturity Payouts, RBI Flags Concerns
Life insurance policy surrenders and withdrawals exceeded maturity payouts in FY26, indicating growing concerns around policyholder retention, product suitability and possible mis-selling, according to the Reserve Bank of India’s Financial Stability Report.
The RBI reported that surrender and withdrawal payments accounted for 38.3% of total life insurance payouts during FY26, compared with 36.9% for maturity benefits. Death claims accounted for 8.1% of total payouts.
The regulator noted that increasing premature exits can affect insurers’ asset-liability management as life insurance investments are structured around long-term commitments. Higher surrender levels may also indicate customer dissatisfaction, unsuitable product selection or competition from alternative investment options.
The report also highlighted rising distribution costs. Private life insurers saw commission ratios increase significantly between FY22 and FY26, while general insurers also experienced higher commission expenses.
However, declining life insurance grievances suggest improvements in market conduct, product suitability and post-sale customer service, according to the RBI.
ICICI Prudential Life Plans Name Change to ICICI Life Insurance
The board of ICICI Prudential Life Insurance has approved a proposal to rename the company as ICICI Life Insurance Limited, subject to regulatory approval from the Insurance Regulatory and Development Authority of India (IRDAI).
The proposed name change follows the company’s move to reclassify Prudential Corporation Holdings from a promoter to an investor. The restructuring is linked to Prudential’s planned acquisition of a 75% stake in Bharti Life Insurance from Bharti Enterprises.
As part of the transaction, Prudential will need to reduce its holding in ICICI Prudential Life to below 10% from its existing stake of nearly 22%.
The insurer said the new name would align with its revised ownership structure after the promoter reclassification process. The board also accepted the resignation of Non-Executive Director Naveen Tahilyani.
ICICI Bank and Prudential have entered into arrangements to address potential conflicts of interest arising from Prudential’s investment in Bharti Life.
Sharp Rise in Insurance Complaints Raises Concerns Over Service Quality
A significant increase in customer complaints in the general insurance sector has raised concerns over claims handling, service standards and communication of policy terms, according to the Reserve Bank of India (RBI).
The RBI, in its Financial Stability Report, highlighted that unresolved grievances could affect policyholder confidence and create broader risks for the insurance sector. Complaints against general insurers increased sharply to 1.78 lakh in 2025-26, nearly three times the level recorded in 2021-22.
The regulator said the continued rise in complaints points towards weaknesses in claims management, customer service and product communication. If such issues remain unresolved, they could weaken customer trust, reduce policy renewals and encourage premature exits from insurance products.
In contrast, the life insurance segment recorded improvement in grievance trends. Complaints declined from more than 1.5 lakh in 2021-22 to around 1.2 lakh in 2025-26, indicating better market conduct, improved product suitability and stronger post-sale support.
The RBI noted that general insurers need to strengthen claims processes, customer engagement and service quality to rebuild policyholder confidence.
Amit Shah Announces Plan for Cooperative Life Insurance Company
Union Minister Amit Shah has announced plans to establish a cooperative life insurance company aimed at increasing the role of cooperatives in India’s insurance sector.
Speaking at an event marking the fifth Foundation Day of the Ministry of Cooperation, Shah said the initiative would draw inspiration from the success of cooperative-linked insurance models such as IFFCO-Tokio General Insurance.
IFFCO-Tokio General Insurance was established in 2000 as a joint venture between Indian Farmers Fertiliser Cooperative (IFFCO) and Japanese insurer Tokio Marine Group. IFFCO currently holds a majority stake of 51%, while Tokio Marine owns the remaining 49%.
The proposed cooperative life insurance company is still at an early stage, with discussions indicating that existing cooperative institutions could become initial promoters. A strategic partner may be considered at a later stage.
Officials said the structure could follow the model of recently established multi-state cooperatives in sectors such as seeds, organic farming and exports, supported by organisations including Amul, NDDB, IFFCO and NCDC.
Private Life Insurers Strengthen Agency Networks Amid Bancassurance Concerns
Private life insurers are increasing investments in agency distribution channels as they seek to reduce dependence on bancassurance and improve customer outreach.
The renewed focus on agency networks comes amid concerns regarding possible mis-selling through bank-led insurance channels and expectations of stronger regulatory oversight in the future.
Industry executives said insurers have accelerated agency expansion over the last two years due to concerns around sales practices in bancassurance. Building alternative distribution channels is being viewed as a way to improve control over customer interactions, sales quality and policy persistence.
According to Shubhra Goel, Managing Director, Financial Services at Alvarez & Marsal India, developing agency and proprietary channels is a strategic priority for many insurers. These channels provide greater control over customer engagement and sales conduct.
However, insurers must maintain balance and not completely move away from partner-led distribution models. The focus should remain on using existing channels effectively while reducing mis-selling risks and improving customer outcomes.
Sanlam Raises Stake in Shriram Life to Accelerate Expansion Plans
South Africa-based Sanlam Group has increased its ownership in Shriram Life Insurance Corporation (SLIC) as the insurer looks to expand its reach and strengthen its growth strategy.
The life insurer has received a primary capital infusion of around Rs. 310 crore from Sanlam and Shriram Group, along with the acquisition of stakes held by existing investors. Following the transaction, Sanlam’s stake in Shriram Life increased to 52.05% in June 2026 from around 38% in December 2025.
The additional capital will support the company’s balance sheet, technology investments, distribution expansion and development of customised insurance products.
Shriram Life recorded around 16% growth in FY26, although expansion was impacted by regulatory changes, including revised surrender value rules and GST adjustments.
Shriram Life MD and CEO Casparus J H Kromhout said the company expects growth of around 20% in FY27, supported by expansion of larger banking partnerships. He added that wider insurance penetration will be essential to achieve the government’s Insurance for All objective.
The insurer also noted that geopolitical developments, particularly tensions in West Asia, affected business momentum during FY26.
West Asia Uncertainty Impacts Life Insurance Savings Business in Q1
The savings segment of India’s life insurance industry faced pressure in the first quarter of FY27 due to geopolitical uncertainty and challenging macroeconomic conditions, while protection products continued to maintain strong growth momentum, according to Emkay Research.
The research report noted that GST exemption on retail life insurance products supported demand for protection-oriented policies during the quarter. Private insurers recorded around 15% year-on-year growth in retail Annual Premium Equivalent (APE), while Life Insurance Corporation of India (LIC) reported approximately 19% growth, resulting in overall industry growth of nearly 16%.
Group business also witnessed strong expansion, with industry-level APE growth of 56% in June 2026, driven by significant growth in private sector insurers.
Among private listed insurers, SBI Life Insurance recorded the strongest performance with 18% retail APE growth, followed by Axis Max Life Insurance at around 15%.
ICICI Prudential Life reported moderate growth, while HDFC Life witnessed a decline due to slower performance in the HDFC Bank distribution channel. Canara HSBC Life recorded strong growth during the period.
