Non-Life Insurers’ Revenue Falls For Second Straight Month

An agent selling insurance products to customers. (Photographer: Brendon Thorne/Bloomberg).

Non-Life Insurers’ Revenue Falls For Second Straight Month

India’s non-life insurers saw their revenue decline for the second straight month amid the disruptions caused by the deadlier second wave of Covid-19 infections.

The industry’s revenue or gross premium underwritten slumped 28.84% over the previous month to Rs 12,316.5 crore in May, according to data released by the Insurance Regulatory Authority of India. Year-on-year, non-life insurers’ saw an 11.35% jump in revenue because of a low base on account of a nationwide lockdown to curtail the first wave of the pandemic.

  • The general insurance companies, which cover for home, travel, motor, health, fire and other natural or man-made calamities and theft, witnessed a 32.13% month-on-month decline in revenue to Rs 10,822.77 crore. Such insurers account for 90.36% share of the non-life insurance market.

  • Revenue for state-run non-life insurers also fell 16.14% over April to Rs 87.09 crore.

  • The standalone private health insurers, however, saw an 11.71% rise in revenue to Rs 1,406.64 crore, aided by increasing awareness and importance of obtaining health insurance covers amid concerns of heavy medical expenditure during the Covid-19 pandemic. Such insurers form 9% of the industry’s market share.

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

According to CARE Ratings Ltd., fears of the loss ratio — the ratio of losses to premiums earned — going up given the resurgence in Covid claims, impacting financials of non-life insurance companies. The rating agency, however, expects a continued uptick in the health segment, enhanced digital solutions and offline offerings to aid premium.

Year-on-year highlights

  • Gross premium of general insurance companies rose 7.17%, while that of state-run insurers contracted 26.57%.

  • Standalone private health insurers witnessed a 66.64% surge in revenue.

Here’s how India’s only two listed non-life insurers fared in May...

ICICI Lombard General Insurance Co.

  • Its gross premium fell 47.12% over the previous month to Rs 934.09 crore.

  • Year-on-year basis, the revenue rose 6.07%.

The New India Assurance Company

  • Its revenue declined 42.98% month-on-month to Rs 2,207.78 crore.

  • Year-on-year, its gross premium rose 21.21%.

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

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