With huge push from the regulator IRDAI, some of the general insurers including three financially weak public sector companies, have started firing from all cylinders to expand their topline July.
ongoing General insurance companies have reported a lower growth in premium mobilization during the four-month period ended July 2022 amid the rise in inflation and interest rates in the country.
General insurers posted a 20.82 percent growth in premium collection at Rs. 77,884 crore during the four-month period as against a 23 percent growth at Rs. 54,492 crore in the three-month period ended June 2022.
The non-life industry showed a growth of 16.05 percent at Rs. 23,392 core in the month of July 2022 as against a growth of 20.68 percent growth at Rs. 17,810 crore in the month of June 2022, according to figures compiled by the General Insurance Council (GIC).
According to observers, the decline in growth is due to rising inflation and the Reserve Bank decision to increase interest rate to tame the price rise. Further, the decline in the performance of public sector New India Assurance (NIA) also impacted the overall growth in premium collection.
NIA reported only an 8.39 percent growth in premium collection at Rs. 12,539 crore during the four-month period ended July 2022. The PSU insurer’s market share also declined to 16.10 percent as of July 2022 as against 17.95 percent in the previous year.
On the other hand, private sector ICICI Lombard General Insurance posted a 49.15 percent growth in premium collection at Rs. 7,330 crore during the four-month ended July 2022. Its market share also increased to 9.41 percent this year as compared to 7.62 percent last year.
Standalone health insurance companies also showed lower growth of 27.13 percent at Rs. 7,411 crore during the four-month ended July 2022 as against a growth of 28.63 percent at Rs. 5,263 crore in premium collection during the three-month period ended June 2022.
The Insurance Regulatory and Development Authority of India (IRDAI) had recently proposed a big hike in the premium collection target in the next five years to deepen insurance penetration in the country.
IRDAI Chairman Debasish Panda proposed that the premium collection which was at Rs 2.20 lakh crore in the year FY2022 could be increased to Rs 2.98 lakh crore in FY2023. This is expected to rise to Rs 11.73 lakh crore in FY2027, a rise of 433 per cent, Panda said at a conclave of insurance CEOs in Hyderabad.