Life insurance companies in India reported first year premium or the new business in August declined more than 5% to ₹30,958.77 crore compared to the ₹32,644.09 crore a year earlier.
For the five months of the fiscal, ended August, the life insurers numbers continued to be in black with a 6% increase in the premium mobilised at ₹1,63,461.52 crore (₹1,54,193.76 crore). Dragging the overall performance last month was market leader, State-owned Life Insurance Corporation of India with a 17% decline in first year premium to ₹16,022.77 crore (₹19,309.10 crore). For the first five months of FY26, LIC reported 3% increase in premium mobilised at ₹98,051.09 crore (₹95,180.63 crore).
Collectively, private life insurers posted 12% higher premium in August at ₹14,936 crore (₹13,334.99 crore). Their premium mobilisation for the five months was nearly 11% more at ₹65,410.42 crore (₹59,013.14 crore), the new business data released by the Life Insurance Council and regulator IRDAI showed.
Analysing the latest numbers, CareEdge Ratings Associate Director Saurabh Bhalerao said the life insurance segment is witnessing the impact of high base effect due to change in regulations in October 2024. He was referring to the new surrender value norms prescribed by IRDAI that came into force last year.
Further, there is a possible normalisation in growth of LIC’s group single premium business which had witnessed robust growth in August last year.
The industry will also see impact of the recently introduced GST reforms from next month, he said, without discounting the possibility of the changes – exemption on individual life and health policies – resulting in additional coverage due to increased affordability.
Emkay research attributed the lacklustre growth in August to the continued impact of new surrender regulations driven by product and channel adjustments, Ganesh Chaturthi-led festivities impacting the business in the western and central parts of India and floods in northern India.
Published – September 09, 2025 09:24 pm IST
