North India Statesman
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Mumbai: Amid regulatory changes in FY 2024-25, the premium income from the new business of the country’s life insurance companies increased by 5.13 percent to Rs 3.97 lakh crore on an annual basis. According to data from the Life Insurance Council, in FY 2023-24, income from the new business premium increased by two percent to Rs 3.77 trillion.
Income from the new business premium of Life Insurance Corporation of India (LIC) increased from 1.86 percent to Rs 2.27 in the last financial year. However, the premium income from the new business of private sector life insurance companies increased by 9.80 percent to Rs 1.71 lakh crore.
The Insurance Regulatory and Development Authority of India has revised the surrender price criteria and made effective from 1 October 2024. According to the new criteria, if a policyholder has paid a full year premium for a year, in such a situation life insurance companies will have to pay more special surrender price to the policyholder at the end of the first year of the policy. Earlier, if the policyholder surrendered his policy at the end of the first year, the insurance companies did not have to pay the customer.
Due to this regulatory change, revenue growth slowed through new business premiums in all insurance products in the last six months of the last financial year.
Revenue growth through the new business premium in terms of group single premium between the current interest rate environment remained almost stable. Sources in the council said that apart from this, the attraction of life insurance policies is also decreasing due to relief in personal tax from the current financial year.
In the last financial year, income from new business premiums for individual policies increased by 11.30 percent to Rs 1.67 trillion, compared to Rs 1.50 trillion last year. The income from the group premium rose by 1.07 percent to Rs 1.64 trillion.
