LIC's market share dips to 77.88% till Feb

Life Insurance Corporation (LIC), due to stiff competition from the private players, has lost about 9.34% market share at 77.88% till February 2005. The insurance behemoth has managed to mop-up Rs 13,443 crore in premium during the period under review.

LIC, which had a market share of 87.22% till February 2004, sold over 1.69 crore new policies in first-year premium till February 2005, according to insurance regulatory and development authority (IRDA) data.

The fall of LIC's market share can also be attributed to its staff unrest, which went on a day's strike demanding higher wages on March 31, a crucial day for the insurer for booking policies across the nation.

The cumulative premium collection for the life insurance industry during the first 11 months of 2004-05 grew by 32.4% to Rs 17,262 crore in February.

While LIC grew by 18.22% in February, private players clocked a whopping 129% growth in life insurance business cornering 22.12% of the market pie.

ICICI Prudential topped among the private players with a market share of 6.69% after collecting Rs 1,154 crore in premium, while Bajaj Allianz replaced Birla Sunlife in the second spot by raking in Rs 494 crore business cornering 2.86% market share.

Birla Sunlife was in the third spot by collecting Rs 484.5 crore in premium (2.81%) while SBI Life mopped Rs 396 crore (2.29%).

HDFC Standard Life managed to mop up Rs 335 crore (1.94%) followed by Tata AIG Rs 253 crore (1.46%) and Max New York Life with Rs 183 crore (1.06%).

The market pie of Aviva, Kotak Mahindra Old Mutual, Metlife, ING Vysya, AMP Sanmar and Sahara were less than 1% each.

Despite private players throwing a stiff competition in the urban markets and selling life insurance policies for a hefty premium, LIC still commands over 90% of the market in terms of number of policies sold during first 11 months of 2004-05.

LIC, which has a stronghold in semi-urban and rural areas, sold over 1.69 crore new policies compared to 18 lakh policies sold by the 13 private players taken together.

In terms of group insurance policies, LIC had 63.65% of the market covering 35.66 lakh lives.

SBI Life was leading among the private players with a share of 12.12% followed by Tata AIG (4.49%), Bajaj Allianz (4.19%) and Aviva (4.12%).