Bandhan Life sees strong growth in non-metros; eyes 40% CAGR in premiums

With a target of increasing policy count and breaking even within six to seven years, Bandhan Life seeks to elevate insurance coverage to a broader population through a well-planned multi-channel distribution strategy.

Bandhan Life Insurance, a Bandhan group entity, expects around 80 per cent of its premium to come from non-metro cities in the next five years. The insurer is aiming at a compound annual growth rate of 40 percent in its annualised premium equivalent (APE) during this period.

For the life insurer, metro and non-metro cities contributed around one-third and two-thirds of their premiums, respectively, in the last financial year.

“It will actually become more towards non metro. I think it will move into an 80-20 kind of a mix over the next four to five years. We are seeing that the non-metro itself is growing. In fact, currently, a lot of tier one cities are non metro, which is a very developed space itself. We are seeing tier two and tier three cities are getting developed further. The ability to save is also growing there,” Bandhan Life Insurance MD and CEO Satishwar B. told businessline in an interview.

Bandhan Financial Holdings (BFHL) acquired Aegon Life Insurance last year and renamed it Bandhan Life Insurance. The strategic acquisition marked Bandhan group’s entry into the Indian life insurance sector, complementing its presence in banking and mutual funds.

For Bandhan Life, the total premium for the last fiscal year stood at ₹512 crore. The new business premium was ₹233 crore for FY25, while the renewal premium was around ₹280 crore for the period.

“The major focus area last year (FY25) was establishing the brand and this new line of business the Bandhan group is getting into. It worked pretty well and the brand has been very well received. We launched as many as eight new products last year focused both on term as well as savings, and ULIP, and also a pension product. Each one of the categories was very well received. So a good start to the new innings. We are basically looking at more than 100 per cent growth in new business premium for FY26,” Satishwar said.

The insurer has set a target of a 40 per cent compound annual growth rate (CAGR) in its annualised premium equivalent (APE) over the next five years.

The insurer aims to be a multi-channel organisation. For this reason, the bancassurance channel becomes critical as Bandhan Bank is the core partner for distribution. The company plans to add a few more bank partners going ahead. While a lot of activities are currently on to bring in a few more corporate agents and working partners, it is also evaluating the strategy to build individual agency channel. “It will be a selective agency force, it is not a mass agency force that we are currently designing,” the MD informed.

The average ticket size for policies is currently in the range of ₹90,000 for the life insurance company, which is focussing more on increasing the number of policies.

“My target is basically to increase the number of policies. Because if you look at the larger population within the country, I want to spread it wide in terms of the number of people who are covered,” Satishwar stated.

As of March 2025, the company had around 3 lakh policies and 7.5 lakh lives covered.

Bandhan Life hopes to end the current financial year with a total of around 4 lakh policies. It aims to break even in the next six to seven years.