ManagementLife insurers' premium collection rises 21% in first seven months
The life insurance industry logged a 21 per cent increase in premium collections during the first seven months of the current financial year compared to the same period last year, indicating recovery in the sector.
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The growth momentum is evident as the industry grew 18 per cent in the first 6 months, while premium collections in the first seven months rose 21 per cent at Rs 1,20,503 crore from Rs 99,310 crore in the April–October period last year.
Commenting on the performance the Council Secretary General S B Mathur said, “The growth in the industry is propelled by low commission single premium policies.”
As per the data compiled by the Life Insurance Council, an industry association comprising of 22 players in the sector, renewal premiums increased by around 24 per cent to Rs 73,952 crore compared to same period last year, while new business premiums increased by around 18 per cent to Rs 46,551 crore on year-on-year basis.
At the same time, total renewal premiums for regular Unit Linked Insurance Plans (Ulips) witnessed a growth of 42 per cent to Rs 29,738 crore compared to Rs 20,878 crore in the same period last year, while non-linked premium increased by 14 per cent at Rs 44,214 crore from Rs 38,897 crore in the same period last year.
Mathur said for the April-October period, single premium policies witnessed a surge of around 42 per cent, with investors preferring non-linked policies signifying a clear trend towards traditional policies.
Total benefit paid to policyholders was Rs 34,021 crore an increase of over 25 per cent compared to Rs 27,179 crore in the same period last year, he said.
Private life companies paid total benefits of Rs 6,996 crore an increase of over 101 per cent from Rs 3,469 crore in April-October period last year.
In addition, the capital deployed by life insurance companies recorded a jump of 25 per cent at Rs 26,734 crore from Rs 21,498 crore at the end of October a year ago.
Also, the number of agents employed increased to 29,94,856 as of October 2009 compared to 27,64,528 in the same month a year ago. Life Insurance companies have more than 11,890 branches of which 8,729 branches were set-up by private sector life insurance companies.