To compensate for the expected drop in sales of life insurance policies after the new guidelines on unit-linked insurance plans (Ulips) kick in from September 1, life insurance companies pitched for more business in the first four months of the financial year.
The industry managed growth of 55.7 per cent in new business income at Rs 34,249.22 crore in the April-July period, as against Rs 21,996.56 crore in the corresponding period last year.
The growth was mainly driven by a surge of 72 per cent in Life Insurance Corporation of India’s (LIC’s) new business premium income. While the state-owned insurer collected Rs 24,430.73 crore during the period against Rs 14,266 crore a year ago period, private players recorded 27 per cent year-on-year increase in collections at Rs 9,818 crore.
| ROBUST START New business premium income of life insurers during April-July | |||
| Company | Apr-Jul ‘09 | Apr-Jul ‘10 | % chg |
| LIC | 14265.99 | 24430.73 | 71.25 |
| ICICI Prudential | 1200.58 | 1990.59 | 65.80 |
| SBI Life | 1398.24 | 1539.28 | 10.09 |
| HDFC Standard Life | 621.31 | 1012.75 | 63.00 |
| Reliance Life | 735.23 | 901.23 | 22.58 |
| Bajaj Allianz | 840.92 | 887.72 | 5.57 |
| Birla Sun Life | 626.56 | 652.58 | 4.15 |
| Kotak Life | 215.84 | 321.36 | 48.89 |
| Tata AIG | 296.21 | 365.35 | 23.34 |
| Aviva | 192.21 | 195.98 | 1.96 |
| Total | 21996.56 | 34249.22 | 55.70 |
| Source: Irda Figures in Rs crore | |||
ICICI Prudential, the largest private insurer in terms of new business premium income, recorded a 65.8 per cent increase in premium collection.
It was followed by HDFC Standard Life, which recorded 63 per cent increase in the new business collection. SBI Life, the second largest private sector insurer, saw a 10 per cent increase in the new business collection to Rs 1,539.28 crore.
“It is easy to push policies we are accustomed to sell. It will take time to convince policyholders about the newly-approved products. We expect a slump in business during the coming months,” said K Sahay, chief executive officer, Star Union Daiichi Life Insurance.
“In the new era, pension will become less attractive. Insurance companies have been selling products that will become less attractive after upcoming changes,” said a senior SBI Life executive.
Once the regulator clears the products, insurance companies will have to train their agents and officials about the changes. Companies expect distributors and agents to take at least a month before sales start picking up. All 23 life insurance companies have re-filed around 270 life products with the regulator.
