Max New York Life looks at low-income customers

MUMBAI (Reuters) - Max New York Life Insurance Co plans to tap the lower middle-class to boost premium income in a market where insurance penetration is still one of the lowest in Asia, officials said.

"We believe there are 100 million households who are between aspirers and seekers," Deputy Managing Director, Rajesh Sud told reporters while launching a new insurance product with low and flexible premium payment options.

The company plans to garner 10 percent of the potential market of 100 million households in the next few years, he added.

India's total insurance penetration was at 4.8 percent but the growth potential is seen huge as individual income rise along with awareness levels.

Max New York Life will invest 95 percent of the investment corpus generated through premiums from this product in government debt while the balance in equity, he said. "We want to avoid exposing these policy holders to the volatility of the stock market," he added.

Max New York Life Insurance is a 74:26 percent joint venture between Max India Ltd and U.S.-based New York Life International.

The company was set up with a capital of 12.32 billion rupees and the founders have committed to invest another 24 billion rupees over the next four years, Sud said.

It earned a premium income of 15 billion rupees in 2007/09 and 4.25 billion rupees in the three months to June, Sud said.