Abhay Tiwari, Managing Director & CEO, Star Union Daiichi Life, said the government may consider GST rationalization on insurance products to make them more affordable and attractive, where reduction in GST could lead to an increase in the insurance net, thereby impacting government collections. Will not done. insurance.
He told Mint’s Rakshita Madan, “The budget may regulate the corporate tax structure and provide relief for organisations.” insurance sector in an interview.
Edited excerpts:
Q. What are your expectations from Budget 2023? Will this be the last full budget before the elections?
India is currently the most demanding market across the globe and there are many external eyes on India as well budget 2023, For the past few years, our Union Budget has always brought in the path of development and we expect 2023 to be no different. We want this to be a budget focused on growth and development. Some thoughts that come to mind are:
It should be a sustainable development oriented budget. Revenue and expenditure mix should be converted into capex investment for job creation through multiplier effect
Read all the news related to the budget Here
Budget may balance corporate tax structure and provide relief for organizations
– There may be a simpler personal income tax method. There may be additional incentive for income tax assessees to make a gradual migration to the new tax regime, as the maintenance of the double tax system may be cumbersome and lead for errors.
Q. What are your suggestions for the budget to the Finance Minister from the insurance sector?,
Our FM has always been a pro-industry figure and some of the thoughts I would like to share are:
Government is working on the theme ‘Insurance for all by 2047’. Keeping the overall economic welfare of the people as the main element, the following points can be considered so that the contribution of insurance to GDP can be increased along with better insurance density.
The government may consider offering deferred liability long-term bonds, which can help organizations provide better returns over longer time horizons.
– At present there is a practice of FRA, I suggest that the government may consider issuing part payment bonds in which insurance companies can participate, thereby taking advantage of the 1% storage fee (currently being charged) is, and the benefits can be given to the policyholders
– Government may consider GST rationalization on insurance products to make them more affordable and attractive, wherein reduction in GST may lead to increase in insurance netDue to which the government collection is not getting affected.
Government may consider easing working capital requirements for insurance companies and may also focus on reducing RSM requirements from 3% for some of the group products to 1%, so that smaller insurance companies Provide coverage to companies/corporates.
Revising the solvency requirement from the current 1.5 to 1.25, so that the released capital helps companies generate better returns on their products
Q. What is your outlook for the insurance sector?,
This sector is poised for growth and will probably drive/drive the growth of the country due to the awareness and importance towards insurance, which is purely generated by the government and regulator. I expect a strong consolidation at the bottom of the pyramid with strong M&A activities between large and very small players to average out competition. The proposed distribution structure proposed by the regulator, Bima Sugam, will prove to be a game changer in the insurance buying behavior of the consumer. With the recent amendments proposed in insurance law and regulation, an insurance company can become a ‘one stop shop’ for the security, retirement and welfare needs of an individual/corporate.
Q. You have recently been selected as India’s Greatest Workplace – 2022-23. What makes you so employee friendly?,
the award belongs to the employees Who? The flag has been kept aloft even in world-stricken circumstances. SUD Life has adopted a four pillar model for evaluating its employees – Grow, Protect, Belong and Be Well. This approach has inclusiveness and sensitivity embedded in the entire fabric of our organizational ethos. We are growing at a steady pace compared to the industry, and this is a clear reflection of the strength and commitment of our employees.
Disclaimer: The views and recommendations given above are of individual analysts or broking companies and not of Mint.
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