Private life insurance companies delivered 13 per cent year-on-year growth in individual annual premium equivalent (APE) during July 2016, lower than 24-27 per cent over the previous two months, according to a report. Life insurance companies in the private sector delivered 13 per cent growth in individual APE during last month, leading to 18 per cent growth year to date(YTD) over the past four months, a report by Kotak Institutional Equities said here on Friday.
According to the report, Bajaj Life Insurance, ICICI Prudential Life and SBI Life have delivered more than 10 per cent growth among large players while HDFC Life, Reliance Life and Met Life reported a decline. Bajaj Allianz Life delivered 44 per cent growth in individual APE as compared to 72 per cent in June 2016. During June quarter of this fiscal, share of individual unit linked (UL) policies increased to 58 per cent from 40 per cent year-on-year.
Birla SL, on a low base, reported 10 per cent APE growth as compared to 7 per cent in June 2016. This was largely led by increase in ticket size, the report said, adding that HDFC Life reported 17 per cent decline in individual APE. CICI Prudential Life reported 15 per cent individual APE growth whereas ticket size in individual non-single business was flat year-on-year, up 7 per cent on quarterly basis, it said, adding that SBI Life remains strong at 50 per cent individual APE growth.
LIC reported 16 per cent growth in individual APE on the back of 40 per cent growth in individual non-single ticket size, likely due to its focus on ULIPs. The report goes on that LIC continues to have high share of single premium at 82 per cent. Private players have generally been selective in this segment.
The share of single premium declined 33-36 per cent in June-July 2016 from 50 per cent in previous months. HDFC Life, Bajaj Life, SBI Life and Max Life have a higher share of single premium in their overall business.
In the group business, the share of private players declined to 12 per cent. APE growth for private players in ULIPs will likely remain strong, it said. The report says that inflows to equity mutual funds remain strong at about Rs 25 billion last month, up from Rs 3 billion in June and Rs 44-47 billion in April and May 2016.