Life insurance companies continued to witness positive growth in the new business premium for the first four months of the current financial year.
Life insurance companies continued to witness positive growth in the new business premium for the first four months of the current financial year. Data from Life Insurance Council shows that new business premium of life insurers saw a rise of 22.66% in the first four months of FY17 against the corresponding period in the previous financial year.
The growth in the industry was led by the Life Insurance Corporation of India (LIC) which saw its new business premium for the month of April-July at Rs 33,332.14 crore, a surge of 24.15% compared to the previous year. On the other hand, private players achieved new business premium of Rs 11,914.86 crore, a growth of 18.69% for first four months of the current financial year. Officials in the industry say that the surge in the premium was largely due to the huge participation in the unit-linked insurance plans (Ulips).
The data from Life Insurance Council also shows that the total new business premium of the insurance sector stood at Rs 45,247 crore in April-July against `36,888.11 crore in the last financial year.
Private players like HDFC Life, Max Life Insurance, Kotak Mahindra Old Mutual Life Insurance and SBI saw growth of 23-64% for the month of April-July. Market participants say that, in the last few months there has been active participation from all the segments like single premium polices, traditional polices and group policies.
“Growth has been coming from across the categories, the only thing that has changed in the last few months is that investors are returning to traditional policies. The data also suggests that, many investors are now opting for single premium policies and many insurance companies are getting continue premium from that segment,” said a senior officer from the leading insurance company.
However, in terms of sale of policies, the industry sold 65,35,069 policies in the April-July up by just 0.21% as against 65,21,197 polices sold in the same period a year ago.
Despite registering a positive growth in the industry, many insurance companies like Aviva Life Insurance, Bajaj Allianz Life Insurance, Reliance Life among others saw fall in new business premium in the first four months of current financial year. In the first four months of FY 17, insurance industry has seen very strong growth and many players believe that, industry is likely to grow at 18-20% in the current financial year.