Feb-17 insurance volumes have grown by 15% for the overall industry, with private insurers growing at 25% y-o-y and LIC growing at 4% y-o-y. Post demonetisation, the key trend is that private insurers have gained significant share, with their post-Nov-16 market share at 59% vs 54% at the same time last year. We attribute this to higher ULIP sales, with ICICI PruLife (highest ULIP mix) continuing to deliver strong growth (58% y-o-y in Feb-17 and +50% post demonetisation). Growth for HDFC+Max Life combined remains weak at 3%, while SBI Life (18%) and agency-led insurers (23%) recorded strong growth.
Industry growth – Significant jump in market share for private insurers: Overall growth for private insurers has picked up materially post demonetisation from 19% y-o-y in Q2FY17 to ~32% y-o-y in the past four months, with industry growth improving from 20% to 23%in the same period. Incremental private insurers’ market share has improved by ~480bps to 58% over the past four months from 53% in Q2FY17.
Ticket sizes continue to drive growth: The number of policies sold has remained largely flat y-o-y for private insurers, indicating that the pickup in premiums is largely ULIP led. Overall ticket size is up 28% y-o-y for private insurers.
ICICI Pru Life – delivering best: ICICI Pru Life continues to see strong growth in ULIPs, registering growth of 58% y-o-y—its market share within private players is 24.6% YTD vs 18% in FY16.
SBI Life—Feb-17 slower growth mainly base impact: While SBI’s growth looks optically lower at 18% y-o-y, this is due to a higher base; on a trailing three-month basis SBI has delivered 35% y-o-y growth.
HDFC + Max Life – Growth remains slow: Growth for HDFC Life has remained weak over the past nine months, and was flat y-o-y in Feb-17 while even Max Life volumes have been weak, and this has led to a 500 bps drop in market share (within private) from 27% last year to 22% now.
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Agency-led insurers doing well: Agency-led insurers clearly have been doing well, with volume growth similar to bank-led insurers after demonetisation. Within agency-led insurers, Bajaj/Birla are delivering well.