Unit-linked insurance sales unfazed by mkt - industry

MUMBAI (Reuters) - Indian life insurance firms have not seen any "definite shift" from unit-linked policies (ULIP) to traditional products by customers despite volatile stock markets, top industry officials said on Tuesday.

ULIPs are insurance policies sold as units like mutual funds and the corpus is mainly invested in the equity and debt market and Indian insurance firms have been generating the maximum premium income from such products.

India's benchmark BSE index fell 11.7 percent in September, but posted its smallest quarterly loss in 2008 to be down just 4.5 percent, compared with a drop of almost 14 percent in the June quarter and nearly 23 percent in the March quarter.

"I have not seen any very definite shift from ULIP to other products," T.S. Vijayan, chairman of state-owned Life Insurance Corp of India, the country's largest insurer.

The net asset values of ULIP units are declared daily and was not the proper way to evaluate a ULIP portfolio as it should be considered as a long term investment, he said.

ULIP contributes more than 93 percent of premium income for private sector Reliance Life Insurance Co Ltd, its President and Chief Executive Officer, P. Nandagopal, said.

"The ability to push the product clearly depends upon how you sell, if you are selling it as a long-term financial product, the short-term volatility is not going to impact that at all," he said.

He also said ULIP, as a product, was more flexible and superior than other products as it was transparent in its investments.

He also added ULIP also included debt prodcuts.