LIC Saves The Day For Life Insurers In Pandemic-Marred May
Insurance policy. (Image: BloombergQuint)

LIC Saves The Day For Life Insurers In Pandemic-Marred May

Life Insurance Corp. of India buoyed new business premiums of the industry in May even as the number of policies sold fell amid disruptions caused by the deadlier second wave of the Covid-19 pandemic.

New business premiums for life insurers rose 41.19% over the preceding month to Rs 12,977 crore in May 2021, according to data released by Life Insurance Council. Year-on-year, it contracted 5% despite a low base due to the national lockdown that stalled trade.

When compared to the pre-pandemic level two years back in May 2019, the industry’s new business premium fell 29.93%.

  • LIC’s new business premium jumped 106.31% to Rs 8,947.64 crore. The company’s group single policy premiums surged 158% month-on-month in May. Its group non-single premiums soared 445%.
  • Private insurers saw their premium fall 20.19% over the previous month to Rs 4,029.34 crore in May.
  • Year-on-year, however, new business premiums of private firms increased 12.32%, while LIC’s fell 10.66%.

The number of policies sold in the industry declined 13.69% over the previous month in May. That’s despite a 114% and 20% jump, respectively, in the number of group single and group non-single policies sold by LIC during the reported period.

To be sure, the rise in premium compared to the percentage increase in the number of policies sold seems skewed possibly because of price hikes. BloombergQuint had earlier reported that life insurers are either refusing to renew group covers or have increased prices as claims spiked during the pandemic.

Also read: Insurers Refuse To Renew Group Life Covers Or Want Up To 150% Higher Premiums

How Private Insurers fared…

HDFC Life Insurance Co.

  • Its new business premium fell 25.61% over the preceding month to Rs 935.01 crore in May 2021.
  • Year-on-year, its premium increased 54.44%.

SBI Life Insurance Co.

  • The company’s new business premium dropped 32.17% month-on-month to Rs 648.41 crore in May.
  • Over the year earlier, it fell 1.84%.

ICICI Prudential Life Insurance Co.

  • This is the only listed private life insurer that witnessed a rise in new business premium.
  • Its premium increased 1.38% over the preceding month to Rs 652.06 crore in May.
  • Year-on-year, however, it declined 21.09%.

Also read: Didn’t Get A Hospital Bed For Covid-19 Care? Won’t Be Easy To Get Insurance

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