Life insurance companies clock a 25.28% drop in premiums, shows data

The life insurance industry reported a 25.28 per cent decline in new business premium income in November 2023 to Rs 26,494.83 crore from Rs 34,588.8 crore recorded a year ago. The fall in group premium and change in taxation norms for policies with a higher ticket size dragged the premiums of the state-run Life Insurance Corporation of India (LIC) and private insurers, respectively.

According to the data released by the Life Insurance Council, the premium of private insurers slipped 9.33 per cent Y-o-Y to Rs 10,360.29 crore from Rs 11,426.73 crore as a result of a change in product mix due to the measures taken to counter the impact of tax imposed on the premiums of Rs 5 lakh. On the other hand, LIC’s premiums dropped by 32.86 per cent to Rs 16,134.55 crore from Rs 24,032.07 crore as a result of a decline in group premiums.

The group premium of LIC dropped by 37.48 per cent to Rs 11,649.54 crore in the reported month from Rs 18,635.93 crore. The fall in the business has affected the overall group premium of the industry which fell by 34.02 per cent to Rs 14,735.49 crore from Rs 22,334.95 crore across the time period.

“If you look at the numbers, you can see the majority of the fall has been in the group premiums, both single and non-single. LIC generally dominates the group segment. A fall in their business will affect the entire industry numbers,” said Saurabh Bhalerao, Associate Director at CareEdge. 

Among the private insurance companies, SBI Life Insurance, the largest private insurer, reported a 9.84 per cent decline in premiums to Rs 2,381.73 crore. HDFC Life Insurance saw a 20.70 per cent Y-o-Y fall to Rs 2,159.73 crore.

“The underlying theme that is running through the entire life insurance segment for the current year is the change in taxation norms. There could have been a change in the product mix to accommodate this which has affected the private insurance players,” Bhalerao added.

The individual single premium of the insurance companies slipped by 14.81 per cent to Rs 3,322.48 crore from Rs 3,900.04 crore in the time period under consideration. Whereas, the private insurers lost 18.93 per cent premium in the space to Rs 1,395.1 crore as compared to Rs 1,720.81 crore across the time period.

The other two listed life insurance companies apart from LIC, SBI Life Insurance and HDFC Life Insurance, ICICI Prudential Life Insurance posted a growth of 2.09 per cent Y-o-Y to Rs 1,290.95 crore while Max Life Insurance recorded 7.91 per cent growth to Rs 748.76 crore.

In the period from April 2023 to November 2023, LIC posted a 24.20 per cent Y-o-Y decline in premium to Rs 124,424.31 crore from Rs 164,143.27 crore. On the other hand, the private sector reported 11.58 per cent rise in the time period to Rs 87,266.33 crore.

Among the private sector players, SBI Life Insurance saw 20.90 per cent Y-o-Y improvement in premiums to Rs 21,393.15 crore, whereas HDFC Life Insurance witnessed 11.51 per cent growth in premium to Rs 17,501.43 crore.

ICICI Prudential Life Insurance inched up by 2.01 per cent Y-o-Y to Rs 10,030 crore while Max Life Insurance recorded 24.86 per cent growth to Rs 5,752.86 crore.

The market share of LIC as of November 2023 inched up to 58.77 per cent after touching a bottom of 57.37 per cent as of August 2023. The market share of private life insurers currently stands at 41.22 per cent.

Life Insurance Data	Nov-23	Nov-22	% Growth YoY	Upto Nov 2023	Upto Nov 2022	% Growth YoY
Total New Business Premium	26494.83	35458.8	-25.28	211690.65	242352.31	-12.65
Life Insurance Corporation of India	16134.55	24032.07	-32.86	124424.31	164143.27	-24.20
Private Insurers	10360.29	11426.73	-9.33	87266.33	78209.04	11.58
SBI Life Insurance	2381.73	2641.71	-9.84	21393.15	17694.6	20.90
HDFC Life Insurance	2159.73	2723.39	-20.70	17501.43	15695.62	11.51
ICICI Prudential Life Insurance	1290.95	1264.54	2.09	10030	9832.11	2.01
Bajaj Allianz Life Insurance	738.29	766.48	-3.68	6577.15	6512.16	1.00
Max Life Insurance	748.76	693.88	7.91	5752.86	4607.35	24.86
In (Rs) cr
Source: Life Insurance Council