Life insurers reported first-year premium for nine months ending December declined 7% to ₹2,50,271.76 crore as compared to ₹2,69,190.61 crore in the year-earlier period on the back of lower group single as well as non-single premium mobilisation.
The first-year premium of private insurers increased 10.38% to ₹1,02,866.16 crore (₹93,188.83 crore), while for the State-owned Life Insurance Corporation of India (LIC) it was 16.25% lower at ₹1,47,405.59 crore (₹1,76,001.77 crore), according to the new business numbers of life insurers, posted by insurance regulator IRDAI.
Group single premium of the life insurers for the nine months of the fiscal was 13.9% lower at ₹1,40,506.37 crore and group non-single premium witnessed a decline of 44.87% to ₹2,353.34 crore. The insurers had posted a less than 1% increase in total policies sold and a nearly 28% increase in the number of lives covered under the Group schemes.
For December, LIC raced ahead with a 93.8% increase in first-year premium to ₹22,981.28 crore (₹11,858.50 crore). Driving the growth, during the month, for the company was a manifold increase in Group Single premium to ₹17,601.97 (₹5,966.87 crore).
In contrast, private players registered a 4.14% increase in new business to ₹15,599.83 crore (₹14,979.79 crore).
While the noise around a host of regulatory changes, margin compression and moderate growth are bound to weigh on life insurance stocks in the near term, the medium-to-long term structural growth story remains intact, Emkay Research said in a report. Relative to historical numbers as well as to other sectors, valuations for life insurance stocks remain attractive, given the risk-to-reward proposition, it said.
