08:56
Bajaj Life Insurance Managing Director and Chief Executive Officer Tarun Chugh in 2025-2026 was the highest-paid top executive among the country's life insurers, a review of company disclosures showed, as insurers are preparing to navigate new regulatory scrutiny over how they set executive pay.
Chugh got a remuneration of Rs 33.66 crore, up 4 per cent from Rs 32.35 crore the previous year.
The pay package comprised a fixed compensation of Rs 8.37 crore, comprising the pay and allowances, and a variable pay of Rs 21.50 crore, split between Rs 3.79 crore in cash and Rs 17.96 crore in non-cash components, along with employee stock options.
For accounting purposes, Rs 4 crore was charged to the revenue account and Rs 22.79 crore to the profit & loss account, taking the accounting charge to Rs 26.79 crore.
The payout came in a strong year for the insurer, whose premium income rose 21.1 per cent to Rs 32,896.9 crore.
Chugh is running Bajaj Life since 2017, making him one of the longest-serving chief executives in the sector.
The disclosures come as the insurance regulator moves to tighten its oversight of executive compensation. A recent circular from the regulator ties the pay of key management persons at insurance companies to a broader set of parameters, including regulatory compliance and grievance redress, alongside traditional performance targets.
Aditya Mishra, MD and CEO, CIEL HR Services, said the executive pay in the sector was largely a function of company performance and standing.
"The salary of MDs and CEOs of financial institutions is based on company performance, the industry ranking of the company, and the individual targets set by the company and achievements," he said. In May, the Insurance Regulatory and Development Authority of India revised the performance parameters applicable to key management personnel.
Consequently, the variable pay and incentives of these executives will be closer to customer experience, claims servicing, and grievance redress. The changes take immediate effect and will apply to performance assessment from FY27 onwards. The pay gap between Chugh and others was wide.
Kamlesh Rao of Aditya Birla Sun Life Insurance was the second-highest earner at Rs 10.45 crore, which was down from Rs 11.20 crore in FY25.
His fixed pay stood at Rs 4.99 crore, including Rs 20 lakh in perquisites, while the variable pay of Rs 5.46 crore was split between Rs 2.20 crore in cash and Rs 3.26 crore in deferred components, with no share-linked element.
The insurer separately paid Rs 1.75 crore as deferred remuneration relating to earlier years, and gave Rao 335,731 stock options and performance stock units under Aditya Birla Capital's 2022 employee scheme, disclosed without an assigned monetary value.
Other insurers showed sharper year-on-year swings. Canara HSBC Life Insurance's Anuj Mathur saw his pay jump to Rs 10.32 crore from Rs 6.32 crore, with a fixed pay of Rs 3.80 crore and variable pay of Rs 5.57 crore, which included a Rs 4.22 crore deferred share-linked component.
ICICI Prudential Life Insurance CEO Anup Bagchi's remuneration rose to Rs 10.04 crore from Rs 7.42 crore, with fixed pay of Rs 6.81 crore and variable pay of Rs 3.23 crore paid entirely in non-cash instruments. He was additionally given 536,500 equity options as deferred pay for FY25 performance.
The pay was flatter at two of the country's largest insurers.
HDFC Life's Vibha Padalkar, the only woman heading a major Indian life insurer, received Rs 9.47 crore, marginally higher than the Rs 9.26 crore a year earlier, with a variable pay of Rs 3.31 crore, paid entirely in cash. At the lower end of the scale, SBI Life's Amit Jhingran was paid Rs 1.96 crore, up slightly from the Rs 1.91 crore.
--Anjali Kumari, Business Standard
