Private life insurers continue to outshine the public sector behemoth Life Insurance Corporation (LIC) in terms of new business premium collection during the nine months of the current fiscal.

The private life insurance industry’s new business premium collection grew 17 per cent to ₹25,972 crore, from ₹22,110 crore in the same period last year, according to data released by the Life Insurance Council.

LIC saw a 15-per cent growth in new business premium collection during the nine months of this fiscal, with collections jumping to ₹59,616 crore from ₹51, 667 crore during the same period last year. Incidentally, LIC saw a massive 48 per cent growth in group single premium business collection at ₹38,204 crore (₹25,718 crore). The insurance behemoth, however, saw its individual regular premium collection decline marginally to ₹12,618 crore from ₹12,735 crore.

According to research firm Kotak Institutional Equities, the annualised premium equivalent (APE) of the insurance industry grew at just 4 per cent y-o-y to ₹4,890 crore. APE is an international formula that gives full weight to regular premium but takes into account 10 per cent of single premium. “Individual business APE during December confirms slowdown for the industry even as y-o-y growth at 7 per cent for private players was marginally better than 5 per cent in November 2015. Recent slowdown/decline of large players, viz. HDFC Life and ICICI Life, has pulled down overall industry growth,” the research note said.

The average policy size in the individual segment for ICICI Prudential Life and HDFC Life is down 10 per cent y-o-y and 21 per cent y-o-y respectively. Incidentally, Kotak Research attributed the slowdown in large players to weakness in capital markets, which translated into slowdown for the unit-linked segment. However, analysts expect lower business volumes to be offset by higher margin business or lower expense overruns as a consequence of declining share of unit-linked insurance policies.

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