Life insurance: steady growth in premiums observed

Private life insurers recorded an 8.9%/17.6% year-on-year growth in individual/total APE a (annualized premium equivalent) in August 22. Growth in individual/total APE during FY23-TD remains strong at 25.3/31% YoY. Life Insurance Corporation of India reported 12.5% ​​/ 37% YoY growth in total APE in July 22 / FY23-TD.

We witnessed disparate margin growth and performance among life insurers in Q1FY23. Tata AIA and Bajaj Allianz (BALIC) led the pack in terms of growth. Tata AIA also recorded the highest year-on-year growth in total insured market share in fiscal 23-TD. The overall VNB (value of new business) margin for gamers was mainly boosted by higher and lower ULIPs, while retail protection remained subdued in the first quarter of FY23.

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Individual/Total APE increased 8.9%/18% for Private Life Insurers Aug 22: Outperforming Aug 22. IPRU Life grew 10.5% YoY. SBI Life (SBLI) reported total APE growth of 1.8% YoY on an unfavorable basis. Max Life was down 11% year-over-year. Individual APE growth remains on a similar trajectory – BALIC/Tata AIA/HDFC Life outperformed with 38%/52.3%/17% YoY growth while SBLI/IPRU Life/Max saw a decline of 5.2%/14%/11.6% on Aug 22, respectively.

Global Sum Insured decreased by 8% month-on-month while Individual Sum Insured increased by 4% month-on-month: In terms of Total Sum Insured, Tata AIA saw maximum improvement in market share from 4.6 % in FY22-TD to 8.4% in FY23-TD, followed by Kotak. Health from 3.3% to 4.5%. In terms of individual sum assured, Tata AIA/SBI Life/BALIC recorded the largest improvement in sum assured from 10.6%/7.3%/3.5% in FY22-TD down 19.4%/7.7%/4.2% in FY23-TD, while HDLI/ IPRU Life/ Max was down 13.3%/12.1%/11, 1% to 9%/8%/9% over the same period, respectively.

LIC lagged its private peers in growth as of Aug 22, but year-to-date performance has been very strong with 37% total APE growth and market share gain . It recorded a growth of 5.2% year-on-year in terms of individual APE against 9% reported by private insurers.

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