Life insurance industry sees 7% drop in new sales

The life insurance industry, which was growing over 100 per cent last year, registered a negative growth for the month of April this year, reporting a decline of 6.77 per cent. It gathered a new business premium of Rs 2,780.11 crore in April this year as against Rs 2,982.28 crore in April 2007.

Life Insurance Corporation of India continues to witness reduced demand from single premium Ulips. It collected a new business premium of Rs 1,247.89 crore in April this year as against Rs 2,134 crore in the corresponding period last year, a fall of 41.5 per cent in new sales.

LIC lost a substantial market share in April. The public sector behemoth had a share of 44.88 per cent during the month, while the private players increased their market share to 55.11 per cent.

However, the 17 private players have registered 80.69 per cent growth in new business premium for the month of April at Rs 1532.22 crore as against a fresh premium of Rs 847.96 crore in April 2007.

A CEO of an insurance company, said, "Due to the volatility in the stock market, pension products, health insurance and traditional products will sell more."