First-year premium collection by life insurance companies decreased by 2.4 per cent to Rs 52,299 crore in the April-December period last year, mainly led by a drop in the premium collection of the largest insurer, Life Insurance Corporation of India’s (LIC). LIC’s premium income for April-December fell by 14.8 per cent.
During December, the industry saw an increase of 1.4 per cent in premium collections to Rs 45,338 crore.
However, during the nine-month period, there has been a steep drop in the sale of unit-linked products (Ulips) after the fall in the equity market. However, policyholders have shown their faith in private insurance companies. Accordingly, insurance companies have come up with return-guaranteed products in the later part of the financial year.
According to the latest data by the Insurance Regulatory Development Authority (IRDA), LIC collected Rs 29,457.13 crore in the first nine months, whereas private insurers posted a significant 20.3 per cent rise to Rs 22,842 crore in the premium collection.
SBI Life, the second-largest private insurer, reported a 56 per cent increase in the premium collection to Rs 3,691 crore.
Another private insurer, HDFC Standard Life, recorded a 19.9 per cent rise in the premium income.
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LIC garnered 56 per cent of the premium income. Jeevan Aastha has alone mopped up around Rs 9,000 crore between December 8, 2008, and January 22 this year.
The insurance giant has sold around 20.5 million policies in the first nine months of the 2008-09 fiscal, against 23.1 million in the corresponding period a year ago.