Thread by @YashJain88

Insurance #Dematerialisation Is A BIG Revenue Opportunity For Depositories

#Depositories Which Benefit:
▪️CDSL (Listed)
▪️NSDL (Likely To File For IPO)
▪️CAMS (Listed)
▪️KARVY

Depositories To Open 30 Cr Insurance Demat A/cs W/Addition Of 53-55 Cr A/cs Annually
@CNBCTV18Live

IRDAI Has Mandated Issuance Of Insurance Policies In Demat Form

Timeline?
▪️All New Policies Fm Dec 2022
▪️All Old Active Policies By Dec 2023

Insurance Demat Will Be Different From Share Demat & Will Be Called EIA (Electronic Insurance A/c)

Insurance Dematerialisation- BIG Money For Depositories?

FY22 Revenue For Depositories
👉🏻CDSL: ₹606 Cr
👉🏻NSDL: ₹821 Cr
👉🏻CAMS: ₹927 Cr

Even Conservatively, Dematerialisation Of Insurance Could Double Revenues For Depositories

Here’s The Math👇🏻

A) Life Insurers Sold 3 Cr Policies (FY22)
-Rev Fm Dematerialisation = ₹150-180 Cr

B) General Insurers Sold ~50 Cr Policies (FY22)
-Rev Fm Dematerialisation = ₹2,500-3,000 Cr

C) Transfer Of Old Policies = ₹1,500-1,800 Cr
 
Rev Potential A + B + C = ₹4,150 Cr-4,980 Cr

Insurance Dematerialisation: Cost Burden For Insurers

▪️LIC SOLD 2.1 CR POLICIES (FY22)

EXPENDITURE👇🏻
-₹105-126 Cr/Annually &
-₹1,000-1,200 Cr (One Time)

▪️HDFC LIFE SOLD 9.15 LAKH POLICIES (FY22)

EXPENDITURE👇🏻
-₹Rs 4.5-5.5 Cr/Annually &
-₹50-60 Cr (One Time)

▪️ICICI PRU LIFE SOLD 6.5 LAKH POLICIES (FY22)

EXPENDITURE👇🏻
-₹3.25-4 Cr/Annually &
-₹42-51 Cr (One Time)

▪️SBI LIFE SOLD 19 LAKH POLICIES (FY22)

EXPENDITURE👇🏻
-₹9.5-11.4 Cr/Annually &
-₹53-64 Cr (One Time)

▪️ICICI LOMBARD SOLD ~22 LK MOTOR & HEALTH POLICIES (FY22)

EXPENDITURE👇🏻
~₹11-13.2 Cr/Annually On Issuance Of New Policies

▪️NEW INDIA SOLD ~56 LK MOTOR & HEALTH POLICIES IN FY21

EXPENDITURE👇🏻
-₹28-34 Cr/Annually On Issuance Of New Policies

▪️INSURANCE DEMATERIALISATION: LONG TERM POSITIVE FOR INSURERS

-Financialisation Of Insurance

-Save Cost On Printing & Delivery Of Physical Insurance Policies

-Improve Transparency In Claims & Restrict Frauds

-Improved Insurance Renewal Ratios Hence Improving Persistency