Life Insurers’ New Business Premium Falls In December; Policies Sold Rise
Private insurers continued to beat Life Insurance Corp. of India.
India’s life insurers saw a fall in their new business premiums even as the number of policies sold rose.
The industry’s new business premium declined 13% over the preceding month to Rs 24,467 crore in December, according to data released by the Insurance Regulatory and Development Authority of India. The revenue fell 2% year-on-year and 9% compared to the pre-pandemic level in December 2019.
The number of policies sold rose 37% over the previous month. Group policy revenue, which had recovered in November, fell.
Private insurers continued to beat Life Insurance Corp. of India.
New business premium of private companies rose 14% month-on-month to Rs 13,032 crore in December, aided by growth in retail premium. Year-on-year, it rose 30%.
For the country’s largest insurer, LIC, revenue dropped 32% over the previous month to Rs 11,434 crore. That came on the back of a 46% decline in its group single premium policy revenue—formed slightly more than a half of its total revenue for the month. Year-on-year, its new business premium fell 24%.
“Overall, developments in FY22 validate the long-term trend of a gradual shift of the retail life insurance market to private players with strong brand and distribution reach,” Emkay Global said in a note.
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How India’s listed private insurers fared in December...
HDFC Life
Reported highest monthly growth in new business premiums among peers.
Revenue rose 56% over the previous month to Rs 2,974 crore in December, aided by growth in retail and group single premium policies. Year-on-year, it rose 64%.
New business premiums also rose 4% sequentially and 36% year-on-year to Rs 6,747 crore in the quarter ended December.
The retail weighted received premium growth this month “indicates low sales volume in the retail protection segment and increased volume of high-ticket non-par savings in the individual business”, Emkay Global said.
SBI Life
New business premium fell 31% over the previous month to Rs 2,943 crore in December on a decline in group single policy premiums. Year-on-year, it rose 21%.
New business premium rose 26% sequentially and 56% over a year earlier to Rs 8,505 crore in the quarter ended December.
SBI Life saw a two-year compounded annual growth rate of 11.6% in retail weighted received premium, higher than 10.6% for the private sector, Emkay Global said. This, according to the brokerage, highlighted its powerful brand, distribution strength and consistent product strategy.
“With all its distribution engines firing and it being relatively immune from the reinsurance price hikes in protection, SBI Life is well-positioned to deliver strong, profitable growth over the coming years.”
ICICI Prudential Life
New business premium rose 8% over the previous month to Rs 1,381 crore in December. Year-on-year, too, it declined 14%.
The revenue fell 3% sequentially but rose as much over the year earlier to Rs 3,787 crore in the quarter ended December.
“On a two-year basis, ICICI Pru’s retail weighted received premium declined at 7.7% CAGR, leading to a material market share loss,” said Emkay Global.