Life Insurance Industry Records Flat Growth In Q1, FY24
The life insurance industry experienced a marginal 1 per cent decline in new business premium income growth during the first quarter of FY2023-24. This drop was primarily attributed to a decrease in group regular policies and subdued demand for group superannuation products. Uncertainty surrounding the commission structure further contributed to the stagnation in growth.
Between April and June, private life insurers saw a 10.58 per cent increase in their total premium income, amounting to Rs 28,167 crore, compared to Rs 25,437 crore in the corresponding period last year. This growth was primarily driven by a rise in group single premium policies. However, state-owned Life Insurance Corporation of India (LIC) witnessed a 7 per cent decline in total premium income, which amounted to Rs 44,837 crore during the same period, down from Rs 48,201 crore previously.
Insurance executives attribute the industry's lackluster performance in the first quarter to the decline in group regular premium policies and low demand for annuity products. The uncertain commission structure has further exacerbated the situation.
Regarding group policies, LIC experienced a 20 per cent decline in premiums collected, while private insurers recorded a significant 57 per cent decrease in group non-single premiums over the three-month period.
In June alone, LIC reported a premium collection of Rs 24,971 crore, representing a year-on-year growth of 20.96 per cent compared to Rs 20,644 crore in June 2022. Private life insurers collected Rs 11,991 crore in premiums during June 2023, reflecting a rise of 13.01 per cent from Rs 10,611 crore in the same month of the previous year.
