Life Insurance Corporation of India (LIC) fared badly compared to private insurers during the month. Irdai data showed that new business premium for LIC fell 35.58% to Rs 12,092.62 crore in November compared to last year.
New business premiums for the life insurance industry declined in November, after witnessing a positive growth between July and October. Data from the Insurance Regulatory and Development Authority of India (Irdai) show that new business premiums for life insurance fell 26.93% year-on-year to Rs 19,159.30 crore in November.
Life Insurance Corporation of India (LIC) fared badly compared to private insurers during the month. Irdai data showed that new business premium for LIC fell 35.58% to Rs 12,092.62 crore in November compared to last year. Private insurers saw a decline of 5.15% in new business premium, which stood at Rs 7,066.64 crore.
According to industry experts, the sharp fall in premiums of LIC dragged the performance of the overall industry. Since July, new business premiums were in positive, with October witnessing a growth of 31.87%.
According to Kotak Institutional Equities, individual annualised premium equivalent (APE) for the private sector declined 7% (YoY) in November, while group APE was down 12% YoY, translating to a 7% YoY decline in the overall APE.
APE is the sum of annualised first-year premiums on regular premium policies and 10% of single premiums, written by insurance companies during any period from both retail and group policyholders. “Notably, individual APE growth turned positive in September 2020 (up 4% YoY) as the lockdown eased, and was up 14% YoY in October 2020, but declined YoY in November. This may be due to a high base effect; November 2019 was a strong month for the private industry with 27% growth as compared to 3-4% growth in September and October 2019,” said the report from Kotak Institutional Equities.
All the categories in new business premiums saw negative growth in November, show data from Irdai. Categories like individual single premium and individual non-single premium saw negative new business premium at 11.04% and 33.73%, respectively. Even all the categories in the group insurance segment witnessed a fall in its new business premium in November.