Bouncing back from  prolonged Covid 19 pandemic disruptions, the life insurance industry, at Rs 2,78 trillion, has recorded 7.50 per cent year on year(Y-O-Y) growth in its new premium income during  FY 2020-21.  

Though,state owned Life Insurance Corporation (LIC), that is now heading for a mega IPO during the current fiscal, has collected the highest ever new business premium of Rs 1.84 lakh crore, a year on year (y-o-y) growth of 3.50 per cent, but has lost its market share, in terms of new premium income, from 68.74 per cent to 66.18 per the industry during Fy 2021.

The life insurance behemoth which has sold 2,10 crore of total policies in 2020-21 against 2,19 policies in FY 2019-20, has also shed its market share in this segment marginally to 74.58 per cent in FY 2020-21 from 75.90 in FY 2018-20.

However, with over Rs 89 trillion of total sum assured, LIC has has gained its market share to 18.11 per cent in FY 2020-21 from 17.80 per cent in Fy 2019-20.   

23 private sector life insurers(Sahara Life has nil business in FY 2020-21), led by SBI Life Insurance has mobilised a total new premium income of Rs 94,103 crore, registering a y-o-y growth of 16.30 per cent, during the reporting year. 

During the FY 2020-21, with its digital infrastructure, LIC has achieved first year premium income of Rs 56,406 crore under individual assurance business, a y-oy growth of 10.11 per cent.

The private sector life insurers’ new total premium under individual assurance business, at Rs 57,417 crore, has grown by 14 per cent y-o-y in FY 2020-21. 

SBI Life,at Rs 20,625 crore, up 24.31 per cent y-o-y, has the largest total new premium income among the private sector life insurers during the year.    

At  Rs 12,500  crore, it has earned the largest amount of individual assurance business in the private sector life insurance industry. 

Five private sector including Bharti Axa Life, Future Generalli Life,, Aegon Life Insurance,, Exide life insurance, Pramerica Life Insurance have seen a degrowth in their total premium income in FY 2021.

Six private sector life insures including Baja Allianz Life, HDFC Life(Rs 20,242, 16.36 per cent) , ICICI Prudential Life(Rs 13,032, 5.54 per cent), Max Life (Rs 6827,22 per cent and SBI Life and Kotak Life Insurance(Rs5,256 crore, 3 per cent) have  earned a total new premium income of more than Rs 5,000 crore and while only three -SBI Life, HDFC Life and ICICI Life- have a total premium income of more than Rs 10,000 crore.

Tarun Chugh, MD & CEO, Bajaj Allianz Life said the life insurance industry showcased resilience, agility and responsiveness across its stakeholder groups – customers, employees, partners and the large base of agents, in the year gone by that was a challenging year for everyone alike. This approach helped the industry keep its promise to its customers, and thereby a good growth.

“At BALIC, our focus remained in ensuring our customers kept their Life Goals on track. Towards this, we introduced a host of measures – from rapid digitisation of services, to product interventions and introduction of digital assets. We are happy to have one of the highest growths in individual rated new business premium among the private players, and it is a reflection of the hard work and focus of our teams to have effective engagement with our customers, and our investments towards it paying off. As we move ahead, we will only ramp up our efforts to meet the needs of our stakeholders, with the focus on our customers, while ensuring the safety and well-being of all,'' he added.

“We expect life insurance companies to report strong growth in individual assurance business in FY2022 (on a low base) driven by revival in ULIPs (equity-oriented inflows were positive after nine months in March 2021), continued traction in non-par, pension and annuity based products; the market remains poised for growth due to dearth of high-yield fixed income instruments, pick-up in credit life from trough levels in FY2021 and high risk aversion pushing demand for individual protection in the latter part of the year −sales of protection policies tend to pick up post a pandemic,'' said a report by Kotak Institutional Equities.

Life insurer's value of new business (VNB) margin to remain strong due to a combination of high margin savings and term products, tempered by growth in ULIPs, said the report.

LIC’s pension and group schemes vertical also created a new record by clocking its highest ever new business premium income of Rs 1.27 lakh crore over a huge base of Rs 1.26 lakh crore in the previous year ended March 31, 2020.

LIC’s market share in the first year premium stood at 64.74 per cent for March and 66.18 per cent for the entire fiscal.

LIC procured 2.10 crore policies, which recorded y-o-y fall of  4.19 per cent in FY 2021.

However, it had sold 46.72 lakh policies March alone, registering a growth of 298.82 per cent over FY20 for the corresponding month.The private sector life insurers , at 71,602.79, once again, led by SBI Life have recorded a three per cent y-o-y  growth in their total number of policies sold in Fy 2021.,

Its market share stood at 81.04 per cent in number of policies for March 2021 and 74.58 per cent for the full year, The number of new schemes sold also saw a new record of 31,795, the release said.

With the addition of 3,45,469 agents, LIC now has a strong sales force of 13,53,808 agents, it said.

In the year, the insurer said it has created 16,564 MDRT (Million Dollar Round Table) qualifiers, the highest ever.

MDRT agent is one who procures insurance business of an amount equal to one million dollar in any calendar year that is from January 1 to December 31.

It also created 26,997 centurion agents in the year. 

The corporation, through its B&AC (bancassurance & alternate) channel, procured 2, 46,910 policies and Rs 1,862.73 crore premium in 2020-21, witnessing a growth of 0.58 per cent and 23.46 per cent respectively.

On the claims front, despite severe constraints due to COVID-19 pandemic, the life insurer settled 2.19 crore maturity claims, money back claims and annuities, amounting to Rs 1.16 lakh crore in the year. 

During the FY2020-21, it settled 9.59 lakh death claims amounting to Rs 18,137.34 crore. Annuity payments due in March 2021 have also been settled on due dates, the release said.