Life insurers posted a sharp rebound in retail premium growth in October as policy demand surged following the GST cut on term plans and festive season spending, Jefferies said in its latest note on the sector.
Retail annual premium equivalent (APE) rose 19% year-on-year (YoY) in October 2025 to Rs 9,266.7 crore, reversing the slowdown seen in September. Private insurers grew 15% YoY, while LIC jumped 28%.
Jefferies said, “Growth improved in October; it can get better from November,” attributing the uptick to term-insurance traction post the GST cut. The brokerage expects savings products to recover from November, driving broader growth through the second half of FY26.
Jefferies on HDFC Life: ‘Buy’
Jefferies maintained its Buy rating on HDFC Life Insurance with a target price of Rs 930, implying a 24% upside from current levels.
The brokerage said HDFC Life’s retail APE growth was modest at 9% YoY in October, but fundamentals remain solid. Persistency ratios are stable, margins resilient, and cost ratios under control. “HDFC Life continues to deliver consistent profitability and superior persistency, supported by a balanced product mix,” Jefferies said.
It added that the integration of Exide Life has normalized, and the insurer remains well-positioned to capture demand once savings-linked policies revive. The stock trades at 2.5x FY27 estimated embedded value (EV), a valuation Jefferies deems “reasonable given its quality of earnings and long-term growth profile.”
Jefferies on ICICI Prudential Life: ‘Buy’
ICICI Prudential Life Insurance retained its Buy rating with a target price of Rs 730, translating to a 19% upside.
Jefferies said ICICI Prudential’s retail APE growth remained muted at 3% YoY in October, weighed down by a high base and weaker ULIP flows. However, the brokerage expects recovery in H2FY26 as the product mix stabilises and demand normalises post-GST revision.
“We expect ICICI Prudential’s margins to gradually improve with better protection mix and cost efficiencies,” the report stated. The stock trades at 1.7x FY27E EV, offering scope for rerating once growth picks up pace.
Jefferies on Max Financial Services: ‘Buy’
Jefferies reiterated its Buy call on Max Financial Services with a target price of Rs 1,900, implying a 17% upside.
Max Life recorded 17% YoY retail APE growth in October, outperforming peers for the third straight month. The Axis Bank partnership continues to drive strong bancassurance traction, the brokerage said.
“Max Life’s balanced product strategy and steady agency expansion underpin sustainable growth,” Jefferies noted. The brokerage expects the value of new business (VNB) margins to stay above 26% through FY26–FY27.
At around 2.2x FY27E EV, Jefferies sees valuations as “undemanding relative to peers given double-digit growth and healthy capital efficiency.”
Jefferies on SBI Life: ‘Buy’
Among private players, SBI Life Insurance remains Jefferies’ top pick, with a Buy rating and a target price of Rs 2,270, implying a 14% upside.
SBI Life’s retail APE rose 19% YoY in October, supported by diversified distribution channels and a strong agency push. Jefferies said SBI Life “continues to deliver consistent growth with stable value of new business margins and operating leverage.”
The brokerage noted the company’s balanced portfolio of protection and savings products, steady persistency ratios, and disciplined cost control. The stock trades at 2.8x FY27E EV, which Jefferies said “is justified by its superior return on embedded value above 18%.”
Jefferies on LIC: Confidence in retail demand
The Life Insurance Corporation of India (LIC) posted a 28% YoY rise in retail APE to Rs 2,754 crore in October, aided by a low base and festive demand. While Jefferies does not assign a rating to LIC, it noted that the insurer’s performance “helped lift overall sector growth and confidence in retail demand.”
LIC’s share in retail APE increased to around 30%, compared with 27% a year earlier. The brokerage added that the improvement was driven largely by traditional products, though sustainability will depend on diversification beyond participating plans.
In October 2025, the life insurance sector’s retail annual premium equivalent (APE) rose to Rs 9,266.7 crore, marking a 19% year-on-year increase, Jefferies said. Private insurers accounted for Rs 6,512.2 crore, up 15% YoY, while LIC’s retail APE jumped 28% YoY to Rs 2,754.5 crore. On a year-to-date basis (April–October), total retail APE stood at Rs 63,160 crore, reflecting a 4% annual growth.
Jefferies on life insurance: Growth likely to accelerate
Jefferies maintained that the GST rate cut’s timing was critical it revived price-sensitive term demand just as the sector was losing momentum. “The immediate impact is visible in October data, but we expect broader recovery once the savings mix normalises,” it said.
The report pointed out that Birla Sun Life, Axis-Max, and HDFC Life lead on a two-year CAGR basis, underscoring the uneven but improving momentum across insurers.