INDIA - India's pension market is poised to grow 39% year over year to 2013, according the Indian Pension Fund Market Forecast 2013.
Further potential lies within the New Pension Scheme (NPS), a nation-wide defined contribution scheme which is set to launch on May 1. The NPS will be open to all workers with a minimum annual investment of R6,000 (US$117). (Global Pensions, 30 March 2009).
Total pension and annuity funds of life insurers increased at a compound annual growth rate of around 46% between 2003-4 and 2007-8, although the growth rate has slowed down in the past few years as a result of the decline in Life Insurance Corporation (LIC) pension business.
However, the report shows that private insurers have revealed massive growth since entering the pension business. Increasing employment in the private sector, rising life expectancy and a rise in healthcare cost at older age will contribute to helping private life insurers maintain the current growth in the following years.
The research shows that pension plans constitute around 40% of the life insurance industry in terms of premium. At present, the LIC dominates the pension industry, while private life insurers contributed 7.5% of the total pension insurance premium in 2007-8. This figure is expected to rise to around 15% by 2012-15, according to the forecast.
Pension plans in India are primarily targeted at 35-45 year olds who have completed saving for protection needs and are looking for retirement plans. Young couples are also opting for retirement plans, although this number remains relatively small in comparison.
The forecast was conducted by RNCOS, a market research and analysis company.
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