For the month of March, the new business premiums of life
insurance companies stood at Rs 25,409 crore compared to Rs 37,459 core in
March 2019.
The new business
premiums of life insurance companies declined 32 per cent in the month of
March, owing to the disruption caused by the spread of coronavirus
(Covid-19) and the subsequent lockdown enforced by the government to contain
its spread.
For the month of
March, the new business premiums of life
insurance companies stood at Rs 25,409 crore compared to Rs 37,459 core in
March 2019. The private life insurers, 23 in total, saw their new business
premiums decline by 34.21 per cent in March 2020 at Rs 8,342 crore compared to
Rs 12,682 crore in the same period of the last financial year.
Similarly,
state-owned life insurance behemoth – Life Insurance Corporation (LIC) – saw
its premiums decline by 31.11 per cent in the reporting month. In March 2020,
it collected new business premiums to the tune of Rs 17,066 crore compared to
Rs 24,776 crore in March 2019.
However, for the
entire fiscal year (FY20), life insurers saw new business premium grow 20.6 per
cent to Rs 2.58 trillion compared to Rs 2.14 trillion in FY19. LIC outpaced the
private insurers in new business premium growth in FY20. LIC’s premium grew
25.17 per cent to Rs 1.77 trillion while private insurers reported an 11.64%
per cent growth to Rs 80,919 crore.
The last quarter
is very significant for life insurers as they sell a lot of products during this
time, especially the last month of the fiscal year. But with the lockdown, the
business of life insurers got impacted severely.
Experts have said
that in the near term, with extension in lockdown, social distancing norms in
place, the new business of life insurers will take a hit.
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