Life insurers' new business premiums zooms 84% in April, thanks to LIC

New business premiums (NBP) of life insurance companies jumped 84 per cent year-on-year (YoY) in April, propped up by 141 per cent increase in initial public offering-bound insurance behemoth Life Insurance Corporation (LIC) of India’s NBP, according to the latest data released by the Life Insurance Council.

In April, the industry earned NBP to the tune of Rs 17,939 crore, compared with Rs 9,739 crore in the year-ago period. LIC’s NBP totalled Rs 11,717 crore in the same period, up 141 per cent, due to a colossal rise in group single premium. Group single premium reported a 227 per cent jump to Rs 8,467 crore in the period. Alternatively, private insurers saw their NBP rise 27.47 per cent to Rs 6,222.91 crore, bankrolled by growth in individual non-single premiums.

NBP is the premium acquired from new policies for a particular year.

Among large private sector insurers, SBI Life’s NBP was up 33.33 per cent YoY in April. HDFC Life’s NBP was up 22.52 per cent in the same period.

ICICI Prudential Life Insurance’s NBP was up 37.59 per cent, while Bajaj Allianz's was up 23.28 per cent.

“Total NBP includes both individual and group businesses. LIC has grown 141 per cent in NBP, primarily due to 233 per cent YoY growth in group business for April 2022,” said Rushabh Gandhi, deputy chief executive officer, IndiaFirst Life Insurance Company. However, in terms of individual new business annualised premium equivalent, the life insurance industry witnessed 39 per cent YoY growth for April, with the private sector leading the growth momentum at 46 per cent YoY, followed by LIC at 28 per cent, said Gandhi. Typically, April is a slow month for life insurance companies. They generate more business in March, given there is greater demand for tax-saving products before the financial year closes.

In March, the life insurance industry reported an NBP of Rs 59,608.83 crore, up 37 per cent from the year-ago period, driven by LIC’s 51 per cent increase in NBP, mainly on account of 60 per cent YoY growth in group NBP.

For FY22, NBP of the industry grew 13 per cent to Rs 3.14 trillion, consequently getting back to double digits after reporting single-digit growth in 2020-21 — the first full year of the Covid-19 pandemic. In FY22, private sector insurers racked up a growth rate of 23 per cent in NBP to Rs 1.15 trillion, while LIC saw its NBP rise over 8 per cent to Rs 1.98 trillion.