Life insurance growth is showing distinct signs of slowing down.
Life insurance growth is showing distinct signs of slowing down. If figures are anything to go by, the life insurance industry has grown by a flat 0.6% on new business premium up to February, pulled down by significant de-growth of Life Insurance Corporation (LIC) and private biggies like ICICI Prudential Life and Bajaj Allianz Life. In February, a month which most insurers rely on, growth has shown a downslide of over 24%.
According to Insurance Regulatory & Development Authority figures available with DNA Money, LIC, which has a 60% market share, has registered a 4.03% fall in growth for the first 11 months of FY09 and a sharp drop in new business premium in February, compared to the same period last year.
Although most insurers churn a lot of business through the year, maximum efforts seem to come in the last quarter of the fiscal. Overall new business premium mopped up in February alone is lower by over Rs 2,000 crore for FY09.
However, between April 2008 and February 2009, the private life insurance sector has grown by 7.19%. Some companies like SBI Life, Reliance Life, Birla Sun Life, Kotak Life, Max New York Life have bucked the industry trend and registered better growth numbers.
ICICI Prudential Life has mopped in the largest business premium and retained its top slot with 8.23% market share. It’s growth in new business premium, however, slipped by over 12% during the period.
SBI Life has moved into a comfortable second position on premium and rank pipping Bajaj Allianz Life. Market analysts contend that the sharp downtrend in the equity market has affected the market to a considerable extent and has impacted sales over the last few months and also in February.
The total new business premium garnered by the industry for February, 2009 stood at Rs 6,679.92 crore compared to Rs 8,843.64 crore in February 2008.
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