Insurers’ New Business Premium Falls The Most In Four Years
New business premium of life insurers fell the most in nearly four years in November due to volatility in the equity market and higher fixed deposit rates.
The annual premium equivalent, a measure of the total size of new sales for a period, fell about 3 percent in the month, the highest since December 2014, according to BloombergQuint’s calculations based on data from Insurance Regulatory Development Authority of India.
Lower flows coming into unit-linked insurance plans—that are linked to equity markets—and rising fixed deposit rates led to a fall in new sales premium, said Nidhesh Jain, analyst at Investec.
New business premium declined nearly 7 percent over the last year for Life Insurance Corporation of India—the country’s largest life insurer—while it remained flat for most private peers in November. The premium fell 19 percent for HDFC Standard Life Insurance Company Ltd. and 14 percent for ICICI Prudential Life Insurance Company Ltd. during the month. It grew 12 percent for SBI Life Insurance Company.
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