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Life insurance companies have posted a higher growth in premiums than their peers in the general insurance segment in the first quarter of the financial year ended June 30.
According to the latest data from the insurance councils (life and general), life insurers posted a 19.6 per cent growth in new premiums for April-June quarter whereas non-life insurers posted 12.4 per cent growth.
Life Insurance Corporation of India (LIC), which saw a drop in new premiums in the last financial year owing to a lesser number of products after product re-filing, sprung back this financial year. The country's largest insurer saw a 17 per cent growth in new premiums and collected Rs 16,428 crore in the first three months of this financial year.
On the other hand, private life insurers registered almost 26 per cent growth in new premiums. Sector officials said unit-linked insurance products were one of the crucial reasons for higher premiums among the large private life insurers. Also, bank-led growth is among the biggest channels of distribution of products, much higher than agency for insurers with a bank promoter/partner.
In FY15, new business premiums of life insurance saw a 5.8 per cent drop on the back of a 13.6 per cent drop in premiums for LIC. However, led by higher sales in unit-linked products, private life insurers had seen a healthy 18 per cent growth in new business premiums.
With respect to general insurance, a slower growth -in the two-wheeler segment in particular - has led to a slower growth in motor insurance premiums. Motor and health insurance constitute the largest pie in the general insurance business.
Although, earlier, public sector insurers used to register higher growth in gross premium incomes, of late private general insurers are almost on a par with them in terms of growth figures.
With active retail and corporate portfolio, standalone health insurers saw an almost 42 per cent growth in premium collection, leading to the overall sectoral growth touching 12.4 per cent.
In FY15, general insurance companies grew about 9.3 per cent owing to slowdown in automobile sales and areas like engineering and industrial insurance. With no major projects coming up, insurance sales in these corporate segments were also hit.
