The life insurance coverage market reported sturdy development in September 2021, with the retail weighted received premium (RWRP) increasing 30% year-on-year (y-o-y). The sturdy development in Sep’21 lifted the YTD FY22 RWRP development which stood at 19.6% vs. 16.7% as of August 2021.
LIC’s RWRP development bounced back to 22% in Sep ’21, assisting its YTDFY22 development to attain 3.7%. Private players maintained development momentum and posted RWRP development of 35% y-o-y in Sep’21, pushing up YTD FY22 development to 32% y-o-y. On a two-year basis, the industry’s RWRP saw a CAGR of 5.2% for YTD FY22, up from 2.4% as of Aug’21, driven by an 8.1% CAGR for the private sector and .9% for LIC.
In these two years, private players have enhanced their market place share in RWRP to 62.2% from 59%. Overall, developments in FY22 validate the lengthy-term trend of a gradual shift of the retail life insurance coverage market place toward private players, with a sturdy brand and distribution attain.
Private players get momentum
Growth for private players appears to be largely driven by an boost in ticket sizes, as the new retail policy count grew by a meagre 3.4% y-o-y. The enhanced ticket size most likely reflects the alterations in the item mix toward ULIPs and non-par-saving merchandise. LIC bounced back with 22% y-o-y development in RWRP in Sep’21, which lifted YTD RWRP development to 3.7% y-o-y.
The person policy count for LIC grew 19.7% y-o-y for YTD FY22. Poor sales of higher-ticket annuity merchandise and significantly less focus on Ulips appear to be hurting LIC’s development. These components corroborate the lengthy-term trend of a gradual shift of the retail life insurance coverage market place toward significant private players that have a sturdy brand and a wide bancassurance network.
HDFC Life reports modest development
For YTD FY22, HDFC Life reported RWRP development of 22% y-o-y and WRP development of 24% y-o-y. These development prices seem moderate in comparison with the top rated peers, but this comes on 2% y-o-y development in RWRP in Sep’20 for YTD FY21. The 2-year RWRP CAGR was sturdy at 11.6%. RWRP development appears to be largely driven by ticket size development as the person policy count was down 8% y-o-y. This indicates that the share of Ulips and non-par savings has enhanced in the person organization.
Edited extracts from Emkay insurance coverage sector report