Uncertainties around regularity & tax clarity hang heavy over life insurers

Adjustments to the new surrender regulations, uncertainties surrounding the Insurance Amendments Bill, and potential direct tax reforms in the upcoming Budget may pose short-term challenge

Life insurance activity was soft in November 2024. Individual annual premium equivalent (APE) grew 7 per cent year-on-year (Y-o-Y) (two-year CAGR: 1 per cent) at industry level. New surrender value guidelines were applicable from Oct’24.

 

Private players saw 15 per cent Y-o-Y growth in November 2024 (two-year CAGR: 7 per cent) (vs 12 per cent /-1 per cent in Oct-24/Nov-23). Public sector major, Life Insurance Corporation’s (LIC’s) APE declined by 12 per cent Y-o-Y (two-year CAGR: -11 per cent). Private players’ market share has risen to 69 per cent (vs ~66 per cent in Nov-23).

 

The year-to-date (YTD) financial year