Will fully pass on GST rate cut benefits to consumers: Axis Max Life Insurance’s Sumit Madan
2 min readThe GST exemption for insurance policies has impacted Axis Max Life Insurance’s Embedded Value by approximately ₹268 crore, according to Sumit Madan, MD & CEO. In an interview, Madan explained the company plans to mitigate this impact through distributor negotiations, cost optimization, and product mix enhancements.
What drove Axis Max Life Insurance’s 27% year-on-year growth in Value of New Business (VNB) during H1?
Our VNB growth stems from strategic product focus, particularly in protection products where we achieved 34% YoY growth and 36% expansion in retail health sales. The annuity segment surged 85% in H1, while proprietary channels grew 22%. New banking and broking partnerships now contribute 5% to Individual APE.
How did GST changes affect VNB margins?
While input tax credit limitations temporarily reduced margins by 0.6%, H1 margins improved 220 basis points to 23.3%, supported by strategic alignment and operational efficiencies.
What’s the full-year Embedded Value impact from GST adjustments?
The ₤268 crore EV impact remains constant for the full year. We’ve passed GST benefits to customers and offset impacts through cost rationalization and distributor partnerships.
Are distributors absorbing GST impacts through commission reductions?
Consumer pricing reflects full GST benefits. We’re balancing impacts through multi-pronged strategies, including vendor negotiations and process improvements currently in progress.
How has the protection segment responded post-GST changes?
Term insurance sales now exceed 60% growth, maintaining sustained momentum. The GST revision presents significant long-term expansion potential for protection products.
What’s the FY VNB margin outlook?
Following strategic product recalibration and new offerings across savings, protection, and Ulip categories, we maintain 24-25% margin guidance, building on FY25’s 24% performance.
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