Private players saw broad individual APE growth in March 2026. SBI Life witnessed growth of 8.5 per cent Y-o-Y, followed by Axis Max Life up 6.9 per cent Y-o-Y. However, ICICI Prudential Life or IPRU Life and HDFC Life saw declines of 0.9 per cent and 0.3 per cent Y-o-Y respectively. LIC saw a growth of 9.9 per cent Y-o-Y.
In FY26, the industry grew by 10.1 per cent Y-o-Y, with private players performing better led by Axis Max Life which grew by 18.7 per cent Y-o-Y and SBI Life by 13.1 per cent . HDFC Life registered individual APE growth of 7.7 per cent Y-o-Y in FY26 while IPRU Life saw a decline of 1.2 per cent Y-o-Y. In March, SBI Life maintained market leadership at 16.5 per cent share in individual APE while HDFC Life, Axis Max Life and IPRU Life’s market share stood at 10.9 per cent, 7.5 per cent and 6.2 per cent respectively.
Despite the bump in March, Q4 was slower than Q3. GST 2.0 provided a boost, but geopolitical instability resulted in weaker momentum. Going into FY27, return-guarantee products appear attractive due to a spread of over 100 basis points between G-sec yields and fresh deposit rates. Valuations at 0.6 time-2.1 times implied FY27 price to enterprise value or P/EV across the sector look attractive in historical terms. As the impact of GST normalises in FY27, value of new business or VNB margin should improve.
There are potential regulatory risks, especially to SBI Life if there is the introduction of mandatory open architecture for banks. In its recent draft norms, the RBI has not mandated open architecture, requiring choice of provider (including insurance) only in cases of mandatory bundling. Even though SBI Life’s mis-selling ratio is consistently very low, the parent-subsidiary structure and SBI Life’s low cost base is supported by closed banca architecture.
SBI Life has been able to maintain mid-teen growth with healthy 26–28 per cent VNB margin as per guidance. It has core operating return on embedded value or RoEV of 19 per cent and higher growth in non-banca channels. One upside could be better product mix since ULIP contributed almost 60 per cent of APE while protection is less than 10 per cent.
Growth in retail protection and annuity would improve return ratios. It has maintained steady double digit growth rates over the last five years with approximately 15 per cent annual growth in APE and above 20 per cent RoEV and strong VNB in the 26-28 per cent range.
SBI Life has coped with challenges like increase in surrender value, removal of tax exemption on insurance premiums and income and the impact of GST cuts on margins in FY26 without cutting commissions. Low cost structure and strong distribution remain key factors driving efficiency. An improved product mix could trigger valuation upgrades.
ICICI Prudential (IPRU Life) witnessed a recovery in retail APE in H2FY26 but overall volumes were muted for FY26. A combination of better product mix, cost execution and a favourable yield curve led to VNB growth of 10.9 per cent in FY26 with VNB margin at 24.7 per cent. IPRU Life’s diversified channel mix (agency, direct, banca, partnership distribution, group) is a competitive advantage vs peers, and reduces risks. A volume recovery could lead to a valuation upgrade.
HDFC Life’s results included a VNB decline of 8 per cent in Q4 and 2 per cent growth in FY26. Management said weak demand would likely continue in Q1FY27. Expansion into small towns has led to 75 per cent of new clients picking up ULIPs. The valuation has dipped to an estimated 1.8 P/EV for FY27 and this could be attractive in historical terms. Any pickup in growth and margins could lead to a big upgrade.
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