Mumbai, Mar 11: The Life Insurance industry in India continued its robust growth registering a sixth consequtive over 100 per cent growth, with the Life Insurance Corporation (LIC) making lost ground and grew faster than the system at 133 per cent year on year (YoY).
According to the figures released by the Insurance Regulatory and Development Authority (IRDA), first year premium numbers for life insurers grew by 119 per cent YoY. A research report on the Indian Insurance Sector (IS) by consultancy firm Macquarie said, growth witnessed by the private sector between April 2007 and January 2008 was 99 per cent, under-scoring the industry's robust health. ''We believe that private sector growth will continue its strong momentum as distribution rolls out'' it added.
ICICI Prudential strengthened its position at the top of the heap by increasing its market share by four per cent in January. Among the larger players, Reliance, SBI Life and Birla Sun Life continued to be the rising stars with the fastest YoY growth rates.
Average premium per policy for the private players contracted by 11 per cent in January following the 10 per cent month on month growth, the previous month. However, the trend for ticket size remains on the up. Year to date, the average premium per policy has increased by 15 per cent for the private sector.
''This is contrary to our expectations. We have been expecting ticket sizes to shrink as incremental growth is being driven by smaller towns and health products. We like this trend, however, because we believe larger ticket sizes are margin-accretive as they reduce processing costs'' the report added The analyst maintained its bullish view on the life insurance industry's growth prospects.
''We think that sector growth is being driven by fundamental changes in India's demographics and fills a serious gap in India's retail savings industry, especially given the lack of social security products in the country. As private player roll out distribution into the smaller towns, we expect the sector's strong growth to sustain'' it said.