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How life insurance business panned out in September 2022?

LIC gained market share, private peers struggled in the month.

October 12, 2022 5:51 IST | India Infoline News Service
For September 2022, IRDAI announced the new business data a few days late. But the data again seems to be showing a sterling performance by LIC while the private insurers have struggled in the month of September 2022. Here are some key points that emerge from the latest monthly report put out by IRDAI.

Key takeaways from Life Insurance new business numbers

a)      LIC dominates the life insurance market in September 2022 also, and it has actually built up a bit of market share in the last one year. The market share of LIC in total premium income for September 2022 is up nearly 270 bps at 68.72% compared to June 2022, while the share of private insurers fell proportionately. The premium income for September 2022 was Rs36,367 crore overall, of which LIC accounted for Rs24,991 crore and private life insurers Rs11,375 crore. On a six months cumulative basis for FY23, LIC has a market share of 68.25%; still quite impressive.


b)      Let us now turn to the mix of premiums collected in September 2022. LIC had a market share of 83.08% in group single premium and 96.53% in group non-single premium. LIC virtually dominates the group life cover space. However, in individual non-single premiums, private insurers had a market share of 64.25% and even in individual single premium, their market share was an impressive 44.79%. This market share pertains to the cumulative for the first six months of FY23.


c)      However, the situation changes drastically if you look at sum assured. Here the private life insurers have an overall market share of 83.33%. That is due to private life insurers selling more of pure risk term covers where the ratio of sum assured to premium is higher. LIC is largely focused on endowments, money-backs and ULIPs, which are more of savings cum insurance products and not pure term covers.


d)      Growth in premiums is where LIC scores really high in September 2022. The industry growth in premiums for September 2022 over September 2021 was 17.31%. However, the private life insurers saw premium contraction of -8.86% while LIC saw premium growth of 34.94%. LIC has seen a positive thrust to its business since July 2022.


e)      Monthly growth may be slightly misleading, so we also look at cumulative growth for six months of FY23. Overall insurance premium collections were up 37.88% yoy. However, private life insurers saw growth of 23.29% in the 6 months to September 2022 while the growth in premium collections of LIC was an impressive 45.92%. LIC has dominated September 2022 in terms of monthly and cumulative FY23 growth.

For now, the stock price of LIC may not be reacting, but the fundamentals in terms of business flow collections are surely stepping up.

Our reading of life premium collections for September 2022

Here are premiums across life insurers for September 2022 and for the first 6 months of the fiscal year FY23 on a cumulative basis.

Insurer Category Sep 2021 Sep 2022 YoY % Sep-21 YTD Sep-22 YTD YoY % Share
Private Total 12480.96 11375.27 -8.86 46869.30 57785.88 23.29 31.75
Individual Single Premium 1681.79 1939.40 15.32 7280.26 8739.06 20.04 44.79
Individual Non-Single Premium 4957.47 5263.17 6.17 20404.14 24640.11 20.76 64.25
Group Single Premium 5093.89 3534.59 -30.61 15824.93 19733.47 24.70 16.92
Group Non-Single Premium 18.29 18.75 2.48 127.86 89.76 -29.80 3.47
Group Yearly Renewable Premium 729.52 619.37 -15.10 3232.10 4583.47 41.81 93.23
LIC of India 18520.21 24991.26 34.94 85112.59 124191.08 45.91 68.25
Individual Single Premium 2292.19 2118.83 -7.56 10100.58 10770.90 6.64 55.21
Individual Non-Single Premium 2523.94 2495.10 -1.14 11805.26 13712.80 16.16 35.75
Group Single Premium 13367.09 19715.92 47.50 61741.34 96878.20 56.91 83.08
Group Non-Single Premium 191.20 567.71 196.92 805.41 2496.19 209.93 96.53
Group Yearly Renewable Premium 145.79 93.70 -35.73 660.00 332.99 -49.55 6.77
Grand Total 31001.17 36366.53 17.31 131981.89 181976.96 37.88 100.00
Individual Single Premium 3973.98 4058.22 2.12 17380.84 19509.96 12.25 100.00
Individual Non-Single Premium 7481.41 7758.27 3.70 32209.40 38352.91 19.07 100.00
Group Single Premium 18460.98 23250.51 25.94 77566.27 116611.67 50.34 100.00
Group Non-Single Premium 209.50 586.46 179.94 933.28 2585.95 177.08 100.00
Group Yearly Renewable Premium 875.31 713.07 -18.54 3892.10 4916.47 26.32 100.00

Data Source: IRDAI

While LIC showed strong growth traction in September 2022, it is still focussed on group policies, which constitute 81.54% of their overall premium flows. Even in this high growth period, LIC reported flat to negative growth in individual premium collections. However, LIC can take solace from the fact that even for private insurers, the growth in individual policy premiums for September 2022 was under 15% on an average.

What we read from the sum assured numbers for September 2022

Here is sum assured across life insurers for September 2022 and for the first 6 months of the fiscal year FY23.

Insurer Category Sep 2021 Sep 2022 Growth % Sep-21 YTD Sep-22 YTD Growth % Share
Private Total 382816.08 461431.84 20.54 2088628.24 2547672.98 21.98 83.33
Individual Single Premium 2391.30 2146.58 -10.23 10624.38 9814.96 -7.62 55.57
Individual Non-Single Premium 114402.23 126356.23 10.45 596076.32 636857.35 6.84 70.77
Group Single Premium 120972.12 140730.11 16.33 555273.14 690856.61 24.42 99.92
Group Non-Single Premium 9258.21 15237.04 64.58 136876.60 88788.37 -35.13 90.82
Group Yearly Renewable Premium 135792.22 176961.88 30.32 789777.81 1121355.70 41.98 83.04
LIC of India 113987.74 65745.32 -42.32 461721.03 509483.56 10.34 16.67
Individual Single Premium 2019.12 1383.44 -31.48 7908.23 7848.39 -0.76 44.43
Individual Non-Single Premium 51761.21 43435.53 -16.08 216988.44 263073.42 21.24 29.23
Group Single Premium 85.37 124.43 45.76 338.43 567.97 67.83 0.08
Group Non-Single Premium 1650.94 1018.08 -38.33 8435.31 8974.52 6.39 9.18
Group Yearly Renewable Premium 58471.10 19783.83 -66.16 228050.61 229019.26 0.42 16.96
Grand Total 496803.81 527177.16 6.11 2550349.27 3057156.54 19.87 100.00
Individual Single Premium 4410.42 3530.02 -19.96 18532.62 17663.34 -4.69 100.00
Individual Non-Single Premium 166163.44 169791.76 2.18 813064.76 899930.76 10.68 100.00
Group Single Premium 121057.48 140854.55 16.35 555611.56 691424.58 24.44 100.00
Group Non-Single Premium 10909.15 16255.12 49.00 145311.91 97762.89 -32.72 100.00
Group Yearly Renewable Premium 194263.32 196745.71 1.28 1017828.42 1350374.96 32.67 100.00
Data Source: IRDAI

When it comes to sum assured, private insurers have an edge in terms of market share at 83.33%. LIC is building on its term policy sales, but it still has a long way to catch upon sum assured rankings with the private insurers. In fact, September 2022 has been disappointing for LIC since it saw its sum assured contract by nearly 42% on a yoy basis.

Private life insurers; and their September 2022 show

Out of the 23 private life insurance players, the top 5 insurers viz. SBI Life, HDFC Life, ICICI Prudential Life, Aditya Birla Sun Life and Max Life accounted for 67.71% of premium collections. This ratio has fallen sharply and could be attributed to the fall in premium income of Bajaj Allianz. For September 2022, highest premium growth was visible for Star Union Dai-ichi and Tata AIA Life, with most of the other leading players seeing contraction in premium income on a yoy basis.

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