Non-life insurers reported gross direct premium of Rs 15,855.11 crore in October, down 0.42% year-on-year.
Motor TP insurance is mandatory, with premium being fixed by the regulator on an annual basis.
Non-life insurers reported gross direct premium of Rs 15,855.11 crore in October, down 0.42% year-on-year. However, motor insurance, which was going through a challenging period in the last few months due to the fall in new vehicles sales, saw premiums pick up in October. The pace of the growth in health insurance slowed due to the fall in group health premiums.
Data from Kotak Institutional Equities show that gross direct premium for motor insurance was Rs 7,183.5 crore in October, compared with Rs 6,954.1 crore in the same month last year, a growth of 3%. Motor insurance, which has two segments — motor own damage (OD) and motor third party (TP), also saw growth in October.
Motor TP insurance is mandatory, with premium being fixed by the regulator on an annual basis. Insurers, on the other hand, fix their own rates for OD and personal accident cover. Gross direct premium for motor TP was Rs 4,306.4 crore in October, up 4% compared with Rs 4,139.4 crore in October last year. Premiums for motor OD went up by 2% to Rs 2,877 crore in the month under review.
“Robust festive demand and a gradual rise in freight volumes and utilization rates supported premiums. Motor premiums have gradually improved from trough levels observed in April and May and will likely improve further,” said the Kotak report.
Motor insurance is an important segment in the non-life industry as it commands market share of around 30% of overall premiums.
Health insurance also saw surge in premiums in October. Gross direct premiums for health insurance stood at Rs 4,074.8 crore, against Rs 3,840.6 crore in the year-ago period, growing by 6%. Retail health saw surge in premiums by 30% to Rs 1,982.6 crore. In the last few months, the pace of growth in retail health has slowed down, market players said.
“A slowdown in growth in retail health was likely an interplay of slowdown in daily new Covid cases in India and lower volumes during the festive season. Standalone health insurers reported a 32% Y-o-Y increase in health premiums, led by a 43% Y-o-Y increase in the retail health business,” said the report from Kotak Institutional Equities.