Edelweiss Life Insurance Company is focused on achieving a higher growth rate than the industry and also on further improving margins. In the coming years, the company aims for a growth of 17 to 18 percent, while the growth rate in the sector is approximately 14 to 15 percent. businessline spoke to its Managing Director and Chief Executive Officer, Sumit Rai, about the current trends in the life insurance segment and the company’s business plans.
The insurance sector today has undergone a major turnaround with important measures such as the waiver of VAT on individual life and health premiums. There are also proposals for regulatory shifts, such as migrating to risk-based capital adequacy standards. How do you see the life insurance segment at the moment?
The industry is in a pretty good place. The market trend is positive overall. Overall, given our penetration levels and economic growth, this is a period of very good growth. There may be ups and downs, but over the next four to five years the sector should grow by 14 to 15 percent. Although the current growth rate in the industry is almost the same, 15 percent growth means a doubling of the current GDP growth rate, which is a very good rate for any company.
How do you situate Edelweiss Life Insurance Company in the industry today? What is the business mix of traditional products and ULIPs?
We are about 14 years old. Most of our growth started since 2017-2018. Previously, the industry had moderated growth, and we were new and we were also conservative in the way we approached the business at that time. From 2017-2018 we gained a more balanced view of how we wanted to grow. We were primarily a single-channel company then, but now we are a multi-channel company with our own partners and partnerships – about 50 to 50 in terms of distribution. We are also well balanced in terms of products. Our traditional products account for approximately 78 percent of sales, while 22 percent comes from Unit Linked Insurance Plans (ULIPS). Our effort has always been to maintain a very balanced approach to our business, whether it’s distribution or products. Over the next four to five years, both in terms of products and distribution, we see the company evolving towards more digital capabilities.
To go Going forward, will the ratio of traditional products to ULIPs remain the same in your product mix?
It must remain the same. We should have about 70 to 80 percent traditional products and about 20 percent ULIPs. We will try to increase the protection side of the portfolio a little further. There have been some supply constraints recently due to reinsurance, but this is improving significantly. So protection will probably increase
The life insurance industry seems quite slow in terms of product innovation compared to general insurance. What is your opinion?
At a core level, life insurance is a fairly stable offering that has been active worldwide for over 200 years. Innovation lies more in the field of processes and technology. For example, today the entire customer acquisition process is completely digitalized across the industry. Five or six years ago there were thirty pages of paperwork and a lot of problems; All of that no longer exists today. Everyone is now completely digital. The issue is largely digital. About 70 percent of our policies are issued within three days. A lot of progress may not be visible on the front end, but significant progress has been made in areas such as data, especially in anti-fraud, which has become a major problem.
How have the margins for the life insurance industry been for the players?
Margins were and still are somewhat under pressure. They have fallen from about 27 to 29 percent a few years ago to about 22 to 23 percent now. I don’t see any major event that will impact margins. Margins should remain between 22 and 25 percent for most players.
What is the capital adequacy for Edelweiss Life? What are your plans for capital injections?
We are very well capitalized. We have around ₹2,800 crores of capital in the organization as of today. On average, we invest around ₹175-200 crore of capital every year, and we expect this to continue over the next three years. As of June 2025, our solvency ratio was 183 percent. At the end of March, when there is a lot of turnover, this can be around 165 percent, while in May, June and July, when turnover is lower, this will be 175 percent.
How much has Edelweiss invested in India so far? Do you have plans for an IPO?
About ₹2,800 crore has been invested so far. We may also consider going public by 2030-31. We expect to break even next year.
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