Public Company
Life insurance biz grows 12.8%
The life insurance industry recorded 12.85 per cent growth in new business premium during the first half of the financial year even though private players saw a drop in sales of new policies. - Aegon Religare Life Insurance infuses Rs 70 cr capital - Marine cargo premium income growth falls to 3% - Baroda Legal & General expects Irda approval by next month - Now, pay risk premium at will - ULP: A savings policy with risk advantage - Irda to put insurance data on website This was despite a 1.75 per cent decline in premium from sale of new life insurance policies in September, when the industry mopped up Rs 8,006 crore first-premium income, according to data released by the Insurance Regulatory and Development Authority (Irda). The growth was largely on account of a 35.21 per cent rose in Life Insurance Corporation’s (LIC’s) first-premium income, which rose to Rs 25,814 crore. For LIC, individual single-premium policies generated a premium income of Rs 7,879 crore, a third of the total first-premium income. In addition, group single-premium policies accounted for 40 per cent (Rs 9997.79 crore) of the premium collected from new policies. The remaining Rs 7,937 crore came from individual non-single premium policies such as unit-linked plans and term covers. In contrast, private players, which did not sell single-premium policies, reported a 14.67 per cent drop in first-premium income (see table). Individual non-single premium policies accounted for 77 per cent, or Rs 10,285 crore, of the new business premium collected by private players in the first six months of the financial year. “The rate of commission in the single-premium policy business may be less but since the ticket size is large, agents can make good money,” said IDBI Fortis Managing Director and Chief Executive Officer GV Nageswara Rao. GAINERS & LOSERS New biz premium collected up to September (Rs crore) Insurer 2008 2009 % change LIC 19,091.49 25,814.59 35.22 SBI Life 2,405.27 2,391.03 -0.59 ICICI Prudential 3,464.34 2,127.94 -38.58 Bajaj Allianz 2,016.36 1,439.15 -28.63 Reliance Life 1,473.12 1,248.52 -15.25 HDFC Standard 1,304.97 1,120.35 -14.15 Birla Sunlife 1,174.31 1,096.54 -6.62 Private total 15,507.89 13,232.11 -14.67 Grand total 34,599.38 39,046.60 12.85 Source: Irda Also, the average ticket size of a single-premium product is three times that of a regular policy. Agents prefer to sell regular policies so that they can earn commission for the subsequent years until the policy is alive. Private insurers do not promote single-premium policies partly as expenses in such policies are capped at 2 per cent of the premium.Same Day Loan commented:
It is really a good news that life insurance sector has recorded such hike in profits due to new premium. I hope it will be at peak in future too.
07.01.2012