General insurers reported 5% year-on-year (y-o-y) development in premiums (excluding crop) in November 2020 (up 7% y-o-y in October 2020 and 9% y-o-y in Q2FY21).
Softening in overall health offset gradual improvement in the motor business enterprise. Motor recovered additional to 7% y-o-y (up 3% y-o-y in October 2020 and down 13% y-o-y in H1FY21). Retail overall health moderated to 17% y-o-y from 30-47% y-o-y development more than July-October 2020.
Among important players, SBI reported stellar ex-crop development of 33% y-o-y (up 24% y-o-y in 8MFY21 greater than 4% y-o-y for common insurers) when ICICI and Tata AIG had been up 7% and 26% y-o-y (up 3% y-o-y and 10% y-o-y in 8MFY21), respectively. Bajaj’s ex-crop business enterprise remained weak down 3% y-o-y. Chola MS was muted at 8% y-o-y (ex-crop).
Retail overall health moderates from highs
Overall development in overall health business enterprise was muted at 2% y-o-y in November 2020 on the back of slowdown in retail overall health to 17% y-o-y from 30-48% more than July-October 2020 and muted development in group overall health (regardless of a low base) this having said that tends to be volatile. Slowdown in development in retail overall health was most likely an interplay of slowdown in each day new Covid-19 instances in India and decrease volumes in the festive season. Private players (excluding HDFC Ergo General) had been down 1% y-o-y in retail overall health (down 15% y-o-y on all round basis) when PSUs had been up 11% y-o-y (up 3% y-o-y on all round basis). Among key private players, SBI, Tata AIG and ICICI Lombard slowed down in retail segments to development of 13% y-o-y, 59% y-o-y, 95% y-o-y and 11% y-o-y from 49% y-o-y, 95% y-o-y and 32% y-o-y development in October 2020.
Premium for standalone overall health insurers (excluding HDFC Ergo Health) slowed down to 17% y-o-y from sturdy 57-66% y-o-y development more than the previous 3 months. Retail overall health insurance coverage slowed down to 17% y-o-y in November 2020 (30% y-o-y in October 2020) from 41-48% y-o-y development observed more than June-September 2020.
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At 17%, development in retail overall health has been moderate, decrease than 30-40% in the previous couple of months. We anticipate the development trajectory to continue or boost as demand for such policies picks up post the pandemic. This segment will having said that report higher loss ratios in the close to-term due to considerable Covid-connected claims and higher overall health inflation for non-Covid hospitalisation and health-related procedures.
Edited extract from Kotak Institutional Equities Research report