Indian Economy News

Life insurance companies' new business premium up nearly 23% in the first quarter of FY25

India's life insurance sector showed strong growth in the first quarter of FY25, with first-year premiums surging by 22.91% YoY to US$ 10.75 billion (Rs. 89,726.7 crore), up from US$ 8.75 billion (Rs. 73,004.87 crore) in the first quarter of FY24. Leading this expansion, the Life Insurance Corporation of India (LIC) saw premiums rise sharply by 28.11% to US$ 6.88 billion (Rs. 57,440.9 crore), driven primarily by robust performance in group premiums. LIC's Group Single premium also grew significantly by 33.49% to US$ 5.35 billion (Rs. 44,671.86 crore) compared to last year.

Private life insurers contributed to the sector's growth with a 14.62% YoY premium increase, totaling US$ 3.87 billion (Rs. 32,285.8 crore), driven by strong gains in the individual segment. Factors such as a low base effect, expanded insurance coverage, and increased single premiums were key in driving this growth. Analysts, including Mr. Saurabh Bhalerao from CareEdge Ratings, project positive momentum with nearly 13% growth in premiums expected for FY25. Major insurers like SBI Life Insurance and ICICI Prudential Life Insurance reported substantial growth rates of 13% and 23.5%, respectively, underscoring the sector's resilience and expanding market dynamics.

As of June 30, 2024, LIC maintained a dominant market share of 64% in the New Business Premium (NBP), up from 61.4% in the corresponding period last year, while private insurers held a 35.9% share, slightly lower than the previous year's 38.6%. Policy sales across the industry also saw a notable increase of nearly 12%, highlighting sustained demand and robust growth prospects in India's vibrant life insurance industry.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.