New business premiums of life insurance companies jump 91% in July
According to data released by the Insurance Regulatory and Development Authority of India (Irdai), life insurers reported NBP of Rs 39,078.90 crore in July. While LIC’s NBP jumped 142 per cent to Rs 29,116.68 crore year-on-year, private insurers’ NBP grew 18.5 per cent to Rs 9,962.22 crore. In June, the life insurance industry grew 4.15 per cent in NBP, mainly due to the contraction in LIC’s premiums.
NBP is the premium acquired from new policies for a particular year. It is the sum total of first year premium and single premium accounted for during the year.
LIC’s strong premium growth in July is primarily on the back of a jump in group single premium and non-single premium. Private insurers have also reported sound growth in group single premiums and group renewal premium.
Among the top life insurers in terms of market share, SBI Life’s NBP was up 29 per cent in July, while ICICI Prudential Life’s NBP rose by 16.20 per cent, and Max Life’s increased by just 1.67 per cent. On the other hand, HDFC Life reported a contraction of 6 per cent in NBP during the same period.
In FY23 so far, life insurers’ have reported a 54 per cent YoY increase in premiums to Rs 1.12 trillion, with LIC’s premium witnessing 62 per cent growth and private insurers growing 39 per cent YoY. In the April-June quarter (Q1FY23), life insurers saw their NBP rise by 40 per cent over the same period a year ago, on account of lower base.
The general consensus is that the premium growth of life insurers will remain healthy this year, given it’s the first year without any restrictions. While it is expected that demand for term, annuity, and guaranteed products will remain robust, unit-linked products may take a hit, given the volatility in equity markets.