Impact of Operating Expenses on Life Insurance Profitability in India

With the passage of IRDA Act 1999, Insurance Industry was opened to private companies and as of now, we have 24 Life Insurance Companies in India operating with a deployed capital of ~36625 crores with more than 20 lakh distributors and 32.5 crore in-force policies. Since 2000 we are in the 18th year of operations but still, more than a dozen companies are grappling with accumulated losses. A regulator has come with stringent guidelines on Expense Regulations and we are yet to see 100% compliance from companies in bringing down their Operating Expenses as per the guidelines.