Spurred by growth in the number of policies renewed, commission expenses of the life insurance industry grew by 5.64 per cent in 2008-09 to Rs 15,533 crore as against Rs 14,704 crore in the corresponding period last year.

However, the increase in commission expenses was lower than the increase in the gross premium collected by the insurers. The total premium income of the life insurance industry grew by 10.15 per cent.

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The commission expenses ratio, which is the ratio between commission expenses and the premium underwritten, declined to 7 per cent in 2008-09 from 7.30 per cent of 2007-08.

Operating expenses of both private as well as Life Insurance Corporation of India increased to Rs 25,723.89 crore as against Rs 20,298.66 crore in 2007-08.

“As the industry continues to expand and companies seek permissions to widen their office network, it is expected that there can be further strain on the expenses in the current year as well,” said Irda in its annual report.

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