Stressing the importance of creating greater awareness on insurance, particularly amongst the youth, a top industry executive pointed out last week that Sri Lanka’s 9.6% life insurance penetration is "grossly inadequate and far from satisfactory" for a nation to face the challenges of the future.

"Unlike in most other countries in our region, Sri Lanka’s life insurance premium is 0.6% - even less than 1% of the GDB", says Manjula De Silva, Managing Director, HNB Assurance Limited.

"We should be looking at a figure of 4% of the GDB in this respect to be satisfied and feel adequate", he noted. "The level of education on insurance products should be pushed up".

"The life policy lapse ratio is also as high as 30% in Sri Lanka", de Silva said responding to a question from The Sunday Island during last week’s news conference at the Galadari Hotel in Colombo.

"Our target is to reduce this ratio to 20% by educating the people on the importance of not only going in for insurance, but also sustaining their policies in the long-term", he said. "Keeping the policies alive is vital to accrue benefits".

Introducing popular vocalists Bathiya and Santhush as HNB Assurance’s Brand Ambassadors to carry forward the message to the youth, De Silva explained that most people think of life insurance only after they are over 40 years.

Asked why the singing duo was selected in particular for this task, he said, "They reach out so well to the youth".

"If a person insures himself when he is 25 years, he would pay 25% less for the policy", the Managing Director pointed out. "At 40 years or more, the policies become more expensive".

Asked about the so-called "small lettering" in policies which tend to mislead people and also contribute towards the policy lapse ratio due to an erosion of trust in the industry, de Silva replied, "There are issues and we have brought some of them under control".

He said that HNB Assurance does not encourage door-to-door canvassing which disturbs households. "We meet people only by appointment".

As a relatively new insurance company which is growing at a rate faster than the industry, HNB Assurance firmly believes in positive thinking at all levels of management, de Silva explained. "That’s our success".

"Despite the economic downturn, we continue to forge ahead with a positive mindset and positive approach to meet the challenges at hand", he noted. "It has worked wonders for us".

"At a time most other companies tend to cut down on spending and defer plans, we are going full throttle opening new branches, launching new campaigns and doing everything and more that was lined up", the MD stressed. "We don’t want to get into a set-up of gloom and doom".