Aided by Life Insurance Corporation of India (LIC) , singlepremium, traditional plans saw a jump of 31.4% in the new business income. MUMBAI: Policyholders have kept up their purchases of new unit-linked insurance plans (Ulips), expecting better returns from the stock market as the Indian economy recovers, recording a 26% rise in new income in the last financial year.Premiums collected from regular Ulips rose to Rs 13,302 crore from Rs 10,565 crore in FY15. This implies new consumers are showing their commitment to the product and new ones see long-term value in buying Ulips, which have a lock-in period of five years.The total premium income — including new business and renewal premiums — was up 11.81% in the last fiscal. LIC launched its first Ulip at the end of the last fiscal.The industry collected Rs 29,504 crore as Ulip renewal premiums in the last fiscal against Rs 28,245 crore in the previous year, according to the Life Insurance Council, an industry body.Ulips are investment-cum-insurance products where the money collected is invested in the stock market or fixed income securities based on the choice of investors. "Customer psyche wants some kind of guarantee so they go for traditional plans, so people are attracted to it," said RM Vishakha, CEO of India First Life Insurance.After a slowdown in Ulip sales, the segment has been growing for private insurers, which derive 70-80% of their income by selling new schemes.Both Ulip sales and renewals improved in the last financial year.

Source: Economic Times July 03, 2016 22:18 UTC