Life insurance premium collection dips 12% in April

First-year premium collection by life insurance companies declined 11.89 per cent in April, compared to the corresponding period last year. According to data collected by the Insurance Regulatory and Development Authority (Irda), life insurers collected Rs 5,063 crore through new policies in April, compared with the Rs 5,746 crore collected in April 2010.

In March, the industry had recorded 47.65 per cent growth in premium collection at Rs 21,948 crore, against Rs 14,864 crore in February.

Life Insurance Corporation of India (LIC), the country’s largest life insurer, collected Rs 3,719 crore by selling new policies in April. This was a decline of 10.9 per cent, compared with Rs 4,174 crore collected in the corresponding period of the last year. Private life insurance players also recorded a decline of 14.78 per cent in premium collection in April.

“Premium collection was down mainly on account of a drop in individual single premiums and individual regular premiums. In both these categories, collection was down by more than 30 per cent in April,” said a senior official of a private life insurance company.

During 2010-11, the life insurance industry collected Rs 1,25,826 by selling new policies, a rise of 15.13 per cent compared with Rs 1,09,290.38 crore collected in the previous financial year. The growth in premium collection was the lowest since 2002, when industry sales had declined 14 per cent.

During the last three years, the industry registered growth of over 25 per cent in new premium income. However, sales took a hit after new norms were introduced in September 2010, with the first six months of 2010-11 accounting for most of the growth in premium income.

ICICI Prudential Life maintained remained the largest private life insurer, in terms of new business premium income. The insurer collected premiums worth Rs 296.48 crore in April, down 2.37 per cent, compared with Rs 303.68 collected in year-ago period.