Life insurance companies in India reported a nearly 18% year-on-year increase in the first-year premium to ₹3,70,543.02 crore for the fiscal ended March 31, 2023.
Private players put up a better show as they continued to challenge the market leader, the State-owned Life Insurance Corporation of India. LIC posted a 16.67% increase in the premium to ₹2,31,899.17 crore, something not enough from a market share perspective as it declined to 62.58% from the previous year’s 63.3%.
First-year premium of the private life insurers for FY23 at ₹1,38,643.85 crore was an increase of 20.03%, while their market share improved to 37.42%, according to the new business statement of life insurance companies put out by IRDAI.
In March, first-year premium of life insurers was 12.63% lower at ₹52,081.12 crore though private players seemed to have made most of a last-minute customer rush to benefit ahead of the April 1 withdrawal of tax exemptions for non-linked policies above ₹5 lakh. Private life insurers’ premium increased 35.14%, over March 2022, to ₹23,364.89 crore even as LIC reported a 32.14% decline to ₹28,716.23 crore.
An Emkay research report said the March performance of the insurers came in the backdrop of taxation changes-induced high-ticket non-linked policy sales. The impact of high-ticket policy growth during the month is clearly reflected in the average ticket-size growth of 42% y-o-y and 34% y-o-y for the private sector and LIC respectively.
In FY24, the focus would be the changes life insurers would bring in the product mix to deliver growth, considering the impact on sale of non-linked high-ticket size policies, it said.