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SBI, Reliance Witnessed Steep Fall In Life Insurance Premium

Posted on May 2, 2013 by
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Life Insurance

The life insurance industry witnessed a drop of 6% in premium collection during the financial year 2012-13, with large private sector life insurers like SBI Life and Reliance Life recording a steep fall in premium income.

The total premium collection by 24 life insurers during FY’13 stood at Rs 1, 07,011 crores, and a decline of 6% over the same period last year.

Among the private sector life insurance companies with premium income of over Rs 1,000 crores, SBI Life’s premium collection fell by 20% to Rs 5,184 crores during FY’13. Reliance Life saw its premium income dip to Rs 1,376.58 crores during the fiscal, down by 23.92%.

Country’s largest life insurer, Life Insurance Corporation of India (LIC) reported a 6.4% drop in its premium collection to Rs 76,246 crores in FY’13 as against Rs 81,515 crores in FY’12.

Among other major private players –ICICI Prudential Life and Birla Sun Life saw premium income dropping by 5.2% and 4.6%, respectively.

However, HDFC Life and Bajaj Allianz Life bucked the industry trend registering a growth of 15.7% and 10.2%, respectively.

ICICI Prudential collected a premium of Rs 4,809 crores, followed by HDFC Life at Rs 4,435 crores and Bajaj Allianz Life at Rs 2,292 crores, during financial year 2012-13.

Another private sector life insurer, Max Life, saw a meager 0.4% drop in premium income at Rs 1,899 crores.

Private sector life insurers together netted Rs 30,765 crores in FY’13 as against Rs 32,718 crores in FY’12, a decline of 6.3%.

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New Business Premium Of Life Insurers Declined 6.3% In FY’13

Posted on April 30, 2013 by
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Life Insurance

The life insurance sector saw a 6.3% drop in new business premiums for the financial year 2012-13 at Rs 1,07,001 crores as against Rs 1,14,233 crores in FY’12.

Country’s largest insurer, Life Insurance Corporation of India (LIC) saw a 6.4% drops in new premium collection in FY’13 at Rs 76,246 crores.

Private life insurer’s new business premium collection for FY’13 stood at Rs 30,765.03 crores, a decline of 5.9%.

The drop in new business premium is mainly due to the slowdown in the economy, resulting in lower disposable income.  With this, number of policies purchased has also come down.

However, with the change in regulatory guidelines and expectation of higher economic growth, insurers believe they would be able to achieve better numbers in new business premiums in the current financial year.

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Shriram Life Expects 29% Rise in New Business Premium

Posted on April 29, 2013 by
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shriram insurance

Private insurer, Shriram Life Insurance is expecting 29% jump in its new business premium income in current fiscal, over the last financial year. The company expects its new business premium income to be around Rs 545 crores by the end of March 2014.

  • The company ended the financial year 2012-13 with an 8% growth in new business premium income at Rs 421 crores.
  • The company is planning to file 14 new products with Insurance Regulatory and Development Authority (IRDA) in the current financial year. And the company is planning to come up with four new products in the April-June quarter itself.
  • The total premium income of the company is expected to go up by 28.6% to Rs 795 crores by the end of March 2014, from Rs 618 crores in the previous year.
  • The company sold 1.54 lakh policies at the end of March 2013.
  • The company has a strong presence in South India, especially in Tamil Nadu and Andhra Pradesh. However, the company is expanding its presence across India.

Shriram Life Insurance is a joint venture between Shriram group and South Africa based Sanlam.

 

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LIC Sees Sharper Growth Decline In New Business Premium Than Industry

Posted on March 20, 2013 by
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LIC

Life Insurance Corporation of India (LIC) showed a sharper decline in growth in new business premium than the life insurance industry during the April-to-February  period this financial year, compared with the last financial year.

While LIC saw a dip of 6.3%, the life insurance industry as a whole saw a 6.1% fall in this period compared to same period last financial year.

LIC’s new business premium collection during April-January period of this financial year stood at Rs 60,705.46 crores compared to Rs 64,820.48 crores in corresponding period last year.

The sharpest fall was seen for LIC in non-group single premium segment, where total new premium collection dropped to Rs 1,635.63 crores, against Rs 10,340.56 crores in the previous year.

On the other hand, private life insurers collected Rs 23,796.29 crores, a dip of 5.5%, compared to the last year.

During April 2012-January 2013, life insurance industry’s total new business premium collection stood at Rs 84,501.74 crores as against Rs 90,015.83 crores in corresponding period previous year.

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LIC’s New Business Premium Fell More Than The Industry

Posted on February 28, 2013 by
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LIC

State-owned, Life Insurance Corporation of India (LIC) has witnessed a fall of 6.5% in new business premium collection during April 2012-January 2013 period to Rs 55,305 crores as against Rs 59,145 crores in corresponding period last year. LIC’s new business premium has fallen more than the life insurance industry. While, life insurance industry has seen a fall of 6%, LIC has seen a fall of 6.5%.

For LIC, the sharpest fall was witnessed in the group non-single premium segment. In which new business premium stood at Rs 1,482.3 crores during April 2012-January 2013 period as against Rs 10,088.7 crores in corresponding period previous year.

Private insurer’s new business premium collection declined by 5% to Rs 21,220.4 crores over the last year.

New business premium collection of life insurance industry during April 2012-January 2013 period stood at Rs 76,525.5 crores as against Rs 81,496.7 crores in corresponding period last year, a decline of 6%.

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Max Life’s Net Profit Up 6% for First Half of FY’13

Posted on November 16, 2012 by
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Max Life InsurancePrivate insurer, Max Life has posted a growth of 6% in net profit to Rs 398 crores for April-September 2012 period compared with Rs 375 crores in corresponding period last year. This rise in net profit is driven by the steady revenue coupled with better productivity and cost efficiency.

The total premium collection for the period under review increased marginally to Rs 2,900.88 crores as against Rs 2,872.84 crores in the same period last year.

However, new business premium collection for April-September 2012 declined by 3.7% to Rs 812 crores from Rs 842.89 crores. The renewal premium increased by 2.9% to Rs 2,089 crores compared with Rs 2,029.95 crores.

As of 30 September 2012, company’s Assets under Management stood at Rs 19,184 crores, a growth of 30% on year-on-year basis. Company’s sum assured touched Rs 158,054 crores, an increase of 7% over the last year.

Company is confident of its sustained growth as it continued to differentiate in the market through its advice based sales, diversified distribution channel, comprehensive product portfolio and superior customer experience through superior claims and complaint management.

Company also announced its maiden shareholder’s dividend of Rs 115 crores, based on the performance of the company during the first half of financial year 2012-13. Post dividend, company’s solvency margins stands at 554%, indicating its strong and stable financial position.

This results in a solvency surplus of Rs 1,716 crores as on 30 September, 2012, compared with Rs 1,073 crores on 30 September, 2011, a growth of 60%.

As on September 30, 2012, company’s paid up capital (including share premium) stood at Rs 2,127 crores.

Max Life Insurance is a joint venture between Max India and Japan based Mitsui Sumitomo.

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Private Life Insurers Witnessed Fall in Premium Collection by Individual Agents

Posted on November 15, 2012 by
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Life InsurancePrivate life insurance companies have witnessed a fall of 13.7% in first half of financial year 2012-13 in new business premium mainly on account of sharp decline in premium collection from individual agents.

An analysis of five large private life insurers has revealed that they collectively witnessed sharp decline in new business premium collection by individual agents in the April-September 2012 period. Premium collection by these life insurers from individual agents for April-September 2012 stood at Rs 1,763.47 crores as against Rs 2,229.28 crores in corresponding period last year, a fall of 21%.

As a proportion of total premium collection, individual agents managed 41.4% in April-September 2012 period compared with 45.9% in the same period last year.

The life insurers that were considered for this analysis are ICICI Prudential Life, HDFC Standard Life, SBI Life, Bajaj Allianz Life and Reliance Life.

Premium collection by corporate agents has also come down. Premium collection by corporate agents for April-September 2012 period stood at Rs 2,008.68 crores as against Rs 2,219.99 crores in the same period previous year, a decline of 9.5%. However, as a proportion of total premium collection, corporate agents witnessed a growth from 45.7% in April-September 2011 period to 47.2% in April-September 2012 period.

As the industry has shown overall negative growth, distribution channels like individual and corporate agents, has been significantly impacted. Banks and brokers have performed reasonably well.

Reliance Life witnessed the steepest fall of 31.5% in premium collection by individual agents. Reliance Life’s premium collection by individual agents for April-September 2012 stood at Rs 262.77 crores as against Rs 383.48 crores in corresponding period last year.

SBI Life’s premium collection by individual agents for April-September 2012 stood at Rs 459 crores compared with Rs 658 crores in the same period last year, a decline of 30.2%.

Bajaj Allianz Life was the only insurer to witness a growth in premium collection by individual agents. Its premium collection by individual agents for April-September 2012 stood at 395 crores as against Rs 380 crores in corresponding period last year, a growth of 4%.

Premium collection of Bajaj Allianz Life by corporate agents for April-September 2012 stood at Rs 113 crores compared with Rs 248 crores in the same period last year, decline of 54.4%.

Premium collection of SBI Life by corporate agents for April-September 2012 stood at Rs 317 crores compared with Rs 626 crores in corresponding period last year, a decline of 49.4%.

However, ICICI Prudential Life saw a rise in premium collection by corporate agents. Its premium collection by corporate agents for April-September 2012 stood at Rs 656 crores as against Rs 435.2 crores, a growth of 50.7%.

During April-September 2012, HDFC Standard Life’s premium collection by corporate agents stood at Rs 834 crores as against Rs 808 crores, a growth of 3.2%.

Premium collected by brokers, who are allowed to sell policies of multiple insurers, grew by 6.1%. However, their contribution to total premium remained as low as 6%.

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LIC’s Vision 2020 ‘Policy in Every Pocket’

Posted on October 22, 2012 by
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LICLife Insurance Corporation of India (LIC) vision 2020 is to have a policy in every pocket. LIC’s chairman D K Mehrotra, said that journey towards vision 2020 is a relay race-baton will get passed on as years change but run must continue till the goal of ‘policy in every pocket’ was achieved.

As per LIC, it is determined to make every Indian feel financially secure and in adequate measure, in terms of life, health insurance and annuity. LIC has vision to reach out to every Indian with these three protections.

Meanwhile, despite a weak economic scenario, LIC has successfully increased its market share. At the end of August 2012, LIC’s market share in terms of new policies increased to 81.25% and 75.95% in terms of new premium.

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LIC‘s New Business Premium Increased by 8% in Q1

Posted on July 25, 2012 by
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LICCountry’s largest life insurer Life Insurance Corporation of India (LIC) has reported a growth of 8.3% in new business premium to Rs 14,451 crore in the first quarter April-June 2012 as against Rs 13,341.97 crore in corresponding periods last year.

During June 2012 LIC garnered new business premium of Rs 5,236.27 crore.

During first quarter of FY’13 private sector insurers together reported a marginal growth in new business with first year premium collection of Rs 5,000.33 crore as against Rs 4,940.89 crore in the corresponding period last year.

In June 2012 all 23 private sector life insurers together collected 1,782 crore.

During April-June quarter non life insurers garnered a total premium of Rs 16,586.48 crore which is the increase of 18% on year-on-year basis.

In first quarter of FY’13, four non-life insurers recorded growth of 19% in premium collection on Y-on-Y basis to Rs 9,581.27 crore, whereas, private sector non-life insurers recorded growth of 16% to Rs 7,005 crore.

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Life Insurers Relying More on Brokers for Selling Policies

Posted on July 23, 2012 by
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Insurance brokerLife insurance companies are increasing focus on insurance brokers for selling insurance policies; this became evident as despite commissions paid by eight large life insurers to different distribution channels has decreased by 7.25% in FY12, but commission paid to brokers increased by 13.34% in FY’12 to Rs 223 crore as against Rs 197 crore in FY’11. Consequently, the portion of commission to brokers has increased to 7% in FY’12 as compared to 5.65% in FY’11.

Eight life insurers that are considered for the analysis include ICICI Prudential Life, HDFC Life, SBI Life, Reliance Life, Max Life, TATA AIA Life, Birla Sun Life and Aviva Life.

In FY’12 total commission paid by eight large insurers to all distribution channels stood at Rs 3,242 crore. Out of which about 50% was paid to corporate agents, 43% was paid to individual agents and 7% was paid to brokers.

In FY’11 total commission paid by insurers stood at Rs 3,495 crore. Of which 46% was paid to corporate agents, and 46% was paid to individual agents.

In FY’12 HDFC Standard Life witnessed a steepest increase in commission paid to brokers, from Rs 3 crore in FY’11 to Rs 19 crore in FY’12. Commissions paid to its brokers by ICICI Prudential increased by 41%. However, brokers earned 49% less commission from TATA AIA Life in FY’12.

Insurance Brokers tie-up with various life and non-life insurance companies and are allowed selling products of any insurer. Moreover, only corporate entities are allowed to be brokers and they are governed by Insurance Regulatory and Development Authority (IRDA) norms. Brokers are required to have minimum capital of Rs 50 lakh and certain minimum level of educational qualification, while it is not required in case of individual or corporate agents. Individual or corporate agents can sell products of only one insurance company.

In FY’12 commission paid to individual agents decreased by 12.83% to Rs 1,411 crore as against Rs 1,619 crore in FY’11. TATA AIA Life paid 38% less commission to individual agents in FY’12 as against FY’11.

However, in FY’12 corporate agents witnessed a growth of 0.62% on year-on-year basis in their commission income to Rs 1,607 crore.

Main reason for the decline of individual agent’s commission is the cap on commissions on Unit-Linked Insurance Plan (ULIPs). Earlier they use to get 14-15% commission now which has come down to 6-7%. There has been also a shift to traditional products in the industry; this has also affected the commission income of various channels.

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