IRDA has said private life insurers have failed to meet the breakeven targets indicated by them at the time of seeking a licence. However, companies have started taking corrective action and have reduced their operating expenses considerably.
According to IRDA, the experience of the insurance markets globally indicates that companies in the life sector take 7-10 years to break even. In India, several insurance companies will complete 10 years of operations in the current fiscal.
The regulator has pointed out that the increase in expenses was largely because of the insurance companies’ inability to control procurement costs.
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