New business premium of life insurance companies grew by 26.13% in the last financial year, backed by strong performance by Life Insurance Corporation of India (LIC) and the popularity of single-premium policies (both in individual segment as well as group business).
LIC registered a 27.22% growth in FY17, higher than the industry avearge as well as its private peers. Data from Life Insurance Council showed that LIC saw its new business premium at `1,24,396.27 crore as on March 2017 compared to `97,777.47 crore in March 2016, a growth of 27.22%. LIC was the market leader in the life insurance segment, having a market share of 71.07% as on March 2017.
In a release on Wednesday, LIC said, “Our group and pension scheme department has shown splendid performance with 78,805.56 crore in new business premium securing 80.96% of the market share against 80.73% last year. LIC’s market share in terms of number of policies is 76.09%, garnering over 20 million new policies this year, as against 74.72 % last year.” LIC saw a growth of 84.22% in individual single premium. Senior officials in the industry say, success of single premium was partly due to the Jeevan Akshay Immediate Annuity plan.
The life insurance segment saw its new business premium at `1,75,021.89 crore as on March 2017 as compared to `1,387,60.47 crore in March 2016, a growth of 26.13%. Individual single premium and group single premium grew by 71.95% and 23% respectively in the last financial year. Private insurers saw lower growth compared to the industry at 23.53% receiving new business premium of `50,625.63 crore as on March 2017.
Among the private sector insurers, SBI Life Insurance grew by 42% and was first insurance company to surpass `10,000 crore mark in new business premium at `10,145.76 crore. Arijit Basu, MD & CEO of SBI Life said, “At SBI Life we have seen positive growth in the last financial year as we grew higher by industry at 42%. In last fiscal around 50% of the growth came from bancassurance channel, while retail agents constituted 30% of growth and remaining from other distribution channels. If we look at new business premium in last fiscal, it was around `10,000 crore and even renewals were very healthy, this all factors will lead to good persistency.” He also added that, both unit linked insurance plans (ULIPs), as well as traditional policies, have done equally well in the last financial year.
Among other private players, HDFC Life saw its new business premium at `8,696.21 crore as on March 2017, a growth of 34.04%. While ICICI Prudential Life Insurance grew by 16.22% and saw its new business premium at `7,863.4 crore in 2016-17. Other players like, Max Life Insurance, Bajaj Allianz Life Insurances and Kotak Life Insurance grew in the range of 14-29% in last financial year.