Life Insurance
Life insurers’ new biz premiums up 5% in FY25
Life Insurance NBP Growth Slows to 5% in FY25; Private Insurers Outpace LIC. (Image Source: FE)
The new business premiums (NBP) of life insurers recorded a modest 5% year-on-year increase to Rs 3.97 lakh crore in FY25, impacted by revised surrender value guidelines and muted demand for ULIPs amid ongoing market volatility. The growth was higher than the 2% seen in FY24 but remained well below the 18% and 13% recorded in FY23 and FY22, respectively.
According to Life Insurance Council data, the country’s largest life insurer, Life Insurance Corporation of India posted a muted 2% year-on-year rise in NBP to Rs 2.27 lakh crore in FY25. Its market share in the overall life insurance industry dropped marginally to 57.05%, from 58.87% in the previous fiscal. In contrast, the 26-member private life insurance grouping reported a 10% growth in NBP, reaching Rs 1.70 lakh crore.
Insurance regulator Irdai rolled out new surrender value norms effective October 1, 2024, mandating higher payouts to policyholders surrendering their policies before maturity. In response, life insurers reworked their product portfolios and recalibrated agent commissions to minimise the impact of the new rules. Despite these efforts, the industry posted four consecutive months of negative NBP growth through February. In March, however, NBP rose 2% year-on-year to `61,439.11 crore.
Market volatility during the second half of the fiscal also weighed on premium growth for several private life insurers. HDFC Life Insurance reported a 13% increase in NBP to Rs 33,761.94 crore in FY25, while SBI Life Insurance saw a 7% decline to Rs 35,576.67 crore. ICICI Prudential Life Insurance posted a strong 25% growth in NBP to Rs 22,583.49 crore, and Bajaj Allianz Life Insurance recorded a 7% rise to Rs 12,292.58 crore.The life insurance industry sold 270 million policies in FY25, down 7% from FY24.
Source : Financial Express
