Motor premiums elevated 8% y-o-y in Q3FY21 up from trough levels of 13% y-o-y decline in H1FY21
General insurers delivered 17% year-on-year (y-o-y) (ex crop) development in premiums in December 2020 greater than 5% y-o-y development in November 2020 and 7% y-o-y in October 2020. This translated to 10% development for Q3FY21. Motor inched up additional to 14% y-o-y development in December 2020 from 3-7% y-o-y more than October-November 2020 (up 8% y-o-y in 3QFY21 compared to 4% y-o-y decline in Q2FY21).
Retail well being moderated for the duration of the quarter to 23% y-o-y development in 3QFY21 (up 43% y-o-y in Q2FY21) owing to a gradual reduce in threat aversion amongst retail consumers, although December was much better month-on-month (m-o-m). SBI and Tata AIG continued to report stellar development (up 26% y-o-y ex crop). ICICI Lombard and Chola MS had been up 10% y-o-y and 8% y-o-y, respectively in Q3FY21 even though Bajaj General lagged business typical at 3% yoy.
Motor continues to increase Motor premiums elevated 14% y-o-y in December 2020 up from 7% y-o-y development in November 2020, 3% y-o-y development in October 2020 and 4% y-o-y decline in 2QFY21. Increasing new automobile sales and powerful momentum in retail sales for the duration of the festive season supported general development. Gradual rise in freight volumes and utilisation prices supported premiums.
Motor premiums elevated 8% y-o-y in Q3FY21 up from trough levels of 13% y-o-y decline in H1FY21. GIC Council has bifurcated motor premiums into (1) motor OD, (2) motor TP and (3) motor package goods. While the mix is non-offered across a time series, motor packages goods had been down 12% y-o-y in 9MFY21 (general motor premiums down 6% y-o-y) and constituted 75% of general motor premiums in 9MFY21 (80% in 9MFY20).
Retail well being moderating Retail well being was up 25% y-o-y in December 2020 (up 23% y-o-y in Q3FY21 compared to 43% y-o-y in Q2FY21). Moderation in retail well being is led by gradual softening in threat aversion amongst probable consumers as general Covid-19 situations continue to decline. Private players (excluding HDFC Ergo General) had been up 30% y-o-y in December 2020. Premium for standalone well being insurers (excluding HDFC Ergo Health) was up 26% y-o-y in December 2020 (up 17% y-o-y in November 2020). This has slowed down from peak levels of 57-66% y-o-y development observed more than August-October 2020. Retail well being insurance coverage for standalone well being insurers was up 24% y-o-y in December 2020 moderating in Q3FY21 (up 17% y-o-y in November 2020 and 30% y-o-y in October 2020) from 40-48% more than June-September 2020.
Edited extracts from Kotak Institutional Equities Research report