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LIC faces challenges on NBP and Policy Numbers in Feb-25

12 Mar 2025 , 09:54 AM

FEBRUARY 2025 – IT WAS THE PRIVATE INSURERS AGAIN

For the fifth month in a row, LIC witnessed contraction in new business premiums; although it must be said that February 2025 was not too great for private insurers either. Overall, new business premium (NBP) contracted by -11.6%. On a cumulative basis, for the 11 months of FY25, LIC showed positive growth in NBP of 1.90%, but lagged private insurers at 11.1%. What about number of policies sold? February 2025 saw LIC reporting contraction in policies sold at -29.9%, while for FY25, the contraction was lower at -10.2%. Since October 2024, the tide has firmly turned in favour of private insurers on NBP and number of policies sold.

PRIVATE INSURER NBP GROWTH SAVES THE BLUSHES IN FEB-25

The table captures new business premium (NBP) growth of life insurers for February 2025 and the first 11 months of FY25. Data is segregated for LIC and private insurers.

PARTICULARS	NBP (Feb-2025)	NBP (Feb-2024)	Growth YOY (%) Feb-25 / Feb-24	Growth YOY (%) FY25 / FY24
Individual Single Premium	4,300.94	3,971.32	8.30%	13.36%
Individual Non Single Premium	8,933.99	9,383.16	-4.79%	12.01%
Group Single Premium	15,130.54	19,320.28	-21.69%	0.54%
Group Non Single Premium	114.01	276.63	-58.79%	-42.68%
Group Yearly Renewable Premium	1,506.10	961.80	56.59%	33.69%
Grand Total Premium Flows	29,985.58	33,913.18	-11.58%	5.71%
PRIVATE INSURANCE COMPANIES
Individual Single Premium	1,694.10	1,889.45	-10.34%	6.84%
Individual Non Single Premium	6,702.95	6,574.59	1.95%	17.75%
Group Single Premium	4,619.85	4,658.96	-0.84%	-0.27%
Group Non Single Premium	19.82	22.96	-13.68%	108.43%
Group Yearly Renewable Premium	1,434.90	871.21	64.70%	34.77%
Private Insurer Premium Flows	14,471.62	14,017.17	3.24%	11.11%
LIC OF INDIA
Individual Single Premium	2,606.84	2,081.86	25.22%	18.88%
Individual Non Single Premium	2,231.03	2,808.58	-20.56%	-0.48%
Group Single Premium	10,510.69	14,661.31	-28.31%	0.82%
Group Non Single Premium	94.19	253.67	-62.87%	-47.85%
Group Yearly Renewable Premium	71.20	90.59	-21.40%	28.29%
LIC Premium Flows	15,513.95	19,896.01	-22.02%	1.90%

Data Source: Life Insurance Council (New Business Premiums – NBP figures are ₹ in Crore)

There are 2 quick takeaways from the NBP data for February 2025 and FY25 till date.

Life insurance sector saw yoy contraction in first year premiums of -11.6% in February 2025. Private insurers did better, growing at +3.2% in February 2025, while LIC trailed with NBP contracting -22.0%. On a cumulative basis, LIC NBP growth at 1.9%, lagged the 11.1% growth shown by private insurers.
Overall premium collections for February 2025 was marginally higher MOM at ₹29,986 Crore. What were the respective contributions of LIC and the private insurers? Private insurers saw their share of NBP at 48.3% in February 2025; compared to 47.1% in January, 55.5% in December, 53.6% in November, and 43.6% in October 2024. The share of LIC fell to 51.7% in February 2025, lower than its share in January 2025 at 52.9%.

It is clear that while private insurers appear to be growing on NBP, the sharp fall in LIC numbers is more due to the big shift to the new tax regime, which does away with Section 80C benefits.

LIC SEES SHARP CONTRACTION IN POLICIES SOLD IN FEB-25

The table captures number of policies sold by life insurers for February 2025 and the first 11 months of FY25. Data is segregated for LIC and private insurers.

PARTICULARS	NBP (Feb-2025)	NBP (Feb-2024)	Growth YOY (%) Feb-25 / Feb-24	Growth YOY (%) FY25 / FY24
Individual Single Premium	1,02,542	1,06,618	-3.82%	10.99%
Individual Non Single Premium	18,36,263	23,85,481	-23.02%	-5.48%
Group Single Premium	225	172	30.81%	32.58%
Group Non Single Premium	341	439	-22.32%	13.49%
Group Yearly Renewable Premium	1,901	3,109	-38.85%	-11.33%
Grand Total No. of Policies	19,41,272	24,95,819	-22.22%	-4.77%
PRIVATE INSURANCE COMPANIES
Individual Single Premium	22,823	32,646	-30.09%	11.06%
Individual Non Single Premium	7,13,427	7,43,986	-4.11%	6.84%
Group Single Premium	146	138	5.80%	34.13%
Group Non Single Premium	17	19	-10.53%	110.47%
Group Yearly Renewable Premium	471	470	0.21%	4.94%
Private Insurer No. of Policies	7,36,884	7,77,259	-5.19%	6.99%
LIC OF INDIA
Individual Single Premium	79,719	73,972	7.77%	10.97%
Individual Non Single Premium	11,22,836	16,41,495	-31.60%	-11.22%
Group Single Premium	79	34	132.35%	28.23%
Group Non Single Premium	324	420	-22.86%	11.25%
Group Yearly Renewable Premium	1,430	2,639	-45.81%	-14.52%
LIC No. of Policies	12,04,388	17,18,560	-29.92%	-10.15%

Data Source: Life Insurance Council (Number of Policies are absolute figures)

Here are quick life insurance takeaways for February 2025 in terms of number of policies sold.

The overall insurance sector saw a fall in number of policies sold at -22.2% for February 2025. While the number of policies sold by LIC fell by -5.2%, the policy sales by the private players fell sharply by -29.9%. Cumulative policies sold by LIC in FY25 also contracted -10.2%, while private insurers showed positive growth in number of policies.
Overall policies sold for February 2025 were sharply lower at 19.41 Lakhs. the contributions of LIC and private insurers have diverged. Private insurers saw their share of number of policies surge sharply to 38.2% from 31.9% last month. LIC saw its share for February 2025 taper to 61.8% compared to 68.1% last month.

Let us turn to how the NBP of 5 largest private life insurers grew in February 2025.

NBP TRENDS: 6 PRIVATE LIFE INSURERS CROSS ₹1,000 CRORE NBP MARK IN FEB-25

In February 2025, 6 private insurers saw new business premium (NBP) of over ₹1,000 Crore, with overall growth at 6.99% yoy. The top 5 private insurers account for 64.7% of NBP.

HDFC LIFE INSURANCE COMPANY	Feb-25 NBP (₹ in Crore)	Feb-24 NBP (₹ in Crore)	YOY Growth (in %)
Individual Single Premium	357.70	339.13	5.48%
Individual Non Single Premium	1,164.16	1,155.10	0.78%
Group Single Premium	1,680.94	1,076.96	56.08%
Group Non Single Premium	0.00	0.00	N.A.
Group Yearly Renewable Premium	10.95	30.92	-64.59%
Total	3,213.76	2,602.11	23.51%