Life Assurance Seminar Insights on Falling Interest Rates & Industry Challenges
Gain valuable insights from the 12th Seminar on Current Issues in Life Assurance in Mumbai, discussing the impact of falling interest rates in the Indian life insurance industry. Explore key questions and conclusions on interest rate trends, challenges faced by insurers, learnings from global markets, and the future implications on investment strategies, product classes, and risk management.
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Presentation Transcript
12th Seminar on Current Issues in Life Assurance (CILA) Falling Interest Rates Conclusions 20 February 2017 Mumbai Indian Actuarial Profession Serving the Cause of Public Interest
Question 1 Where will interest rates be in two-three years time? A) Around the same as of now B) Lower but not mature market levels C) Mature market levels D) Higher www.actuariesindia.org 2
Question 2 Are falling interest rates currently the biggest challenge being faced by the life insurance industry in India? A) Yes B) No C) One of the biggest challenge www.actuariesindia.org 3
Question 3 Are there learnings from other global markets on how to tackle the issue? A) Yes - Definitely B) No India has its own unique challenges C) Some Need customized solutions www.actuariesindia.org 4
Question 4 Which of the following areas will be most impacted by falling interest rates? A) Investment strategy B) Profit margins / Required expense efficiencies C) Product mix D) Risk management E) Insurance company valuations www.actuariesindia.org 5
Question 5 Which product class will become increasingly relevant in case of falling interest rates? A) Unit-linked B) Participating C) Non-participating savings D) Protection E) Annuity www.actuariesindia.org 6
Question 6 Which product class will become increasingly irrelevant in case of falling interest rates? A) Unit-linked B) Participating C) Non-participating savings D) Protection E) Annuity www.actuariesindia.org 7
Question 7 Which asset class is expected to see the highest incremental future investments due to falling interest rates? A) Corporate bonds B) Infrastructure bonds C) Equities D) Others www.actuariesindia.org 8
Question 8 From a risk management perspective, which is the key actionable due to falling interest rates? A) Enhanced ALM B) Operationalisation of ERM framework C) Use of derivatives D) Others www.actuariesindia.org 9
Question 9 Do you see Indian life insurers struggling for solvency if interest rates reached mature market levels in the short to medium term? A) Yes B) No C) Maybe www.actuariesindia.org 10
Question 10 What should be the regulator s primary focus in a falling interest rate scenario? A) Solvency B) Customer protection C) Investments D) Effective risk management www.actuariesindia.org 11
