Record Premium Collections by Private Life Insurance Companies in Aug-21

Jul-21 was a month of 11% contraction in life premiums but new business premiums (NBP) bounced back to 2.88% growth in Aug-21. Interestingly, while LIC reported lower premiums in Aug-21 comparable to last year, the premium collections of private insurers was sharply higher YoY. Much of this growth came from ULIPs and protection products.

The bigger story was the dichotomy between private insurers and LIC. During Aug-21, the total NBP mop-up was up 2.88% YOY at Rs.27,821 crore. Big daddy LIC saw the NBP falling by -3.82% in Aug-21 to Rs.18,961 crore. However, private insurers saw new business premiums grow by an impressive 20.94% yoy to Rs.8,860 crore. 

This is the highest levels of premium collected by private insurers in a month. Private insurers also compensated for the fall in LIC premium collections so the life insurance industry overall ended with growth of 2.88%. For FY22 (Apr-Aug), LIC saw NBP premiums taper by -6.75% YOY while private insurers saw premiums grow 23.05%. As a result, overall NBP premiums FY22 (Apr-Aug) was up 1.62%.

How the Big four private insurers stacked up in Aug-21?

1)    SBI Life Insurance: The second largest private insurer reported 24% growth in NBP flows for Aug-21 YOY. However, Aug-21 premiums were up 74% compared to the average for first 4 months of FY22.

2)    ICICI Prudential Life: The third largest private insurer reported 43% growth in NBP flows for Aug-21 YOY. However, Aug-21 premiums were up 37.5% compared to the average for first 4 months of FY22.

3)    HDFC Life Insurance: The largest private insurer reported muted -6% fall in NBP flows for Aug-21 YOY. However, Aug-21 premiums were up 22% compared to the average for first 4 months of FY22.

4)    Max Life Insurance: Max reported 16.5% growth in NBP flows for Aug-21 YOY. However, the Aug-21 premiums were up 34.8% compared to the average for first 4 months of FY22.