Life Insurance - Growth Trends Remain Strong Amid Multiple Corrections: ICICI Securities

ICICI Securities Report

Private life insurers reported 18%/13% YoY growth in individual/total annual premium equivalent in February 2023 and 18/19% YoY in 11 months-FY23, respectively. Life Insurance Corporation of India reported a decline of 19% YoY in total APE in Feb-23 but has grown strong 20% YoY in 11MFY23.

Overall / individual sum assured growth has been 24/7% in FY23- to-date for private life insurers. Key highlights of the sector include:

1. Strong likely growth in non-par segment in Q4 FY23 in lieu of removal of tax exemption on insurance income from premiums surpassing Rs 500,000 per year from FY24,

2. stable term pricing for key insurers while Bajaj Allianz has taken some selective price hikes,

3. stock price corrections largely in proportion to high ticket size portfolio and

4. higher growth in group portfolio versus individual sum assured.

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