Life, pension and the variable segment recorded growth of 10.70%, 13.38% and 34.66%, respectively, while the annuity and health segments witnessed a decline of 11.83% and 2.68%, respectively, during the last financial year. Life insurance premiums for unit-linked products (ULIPs) witnessed gradual growth for the last three financial years, while premiums for traditional products grew in double digits in the previous fiscal.
Traditional products registered a growth of 10.15% year-on-year in 2021-22, with a premium of Rs 5.92 trillion, compared with Rs 5.38 trillion in 2020-21. ULIPs grew 10.24% YoY, with premiums rising from Rs 0.91 trillion in 2020-21 to Rs 1 trillion in 2021-22. The share of unit-linked products in total premium was 14.48% in the previous fiscal, India’s annual report for 2021-22 showed.
“Life insurance segment constitutes 77% of total life insurance premium, followed by pension and annuity segments together about 22% in 2021-22,” said the report, issued on Thursday. Life, pension and the variable segment recorded growth of 10.70%, 13.38% and 34.66%, respectively, while the annuity and health segments witnessed a decline of 11.83% and 2.68%, respectively, during the last financial year.
During 2020-21, traditional products registered a growth of 9.77% YoY, with a premium of Rs 5.38 trillion, against Rs 4.90 trillion in the previous year. On the other hand, ULIPs had reported a growth of 9.58%, with premiums rising from Rs 83,050 crore in 2019-20 to Rs 0.91 trillion in 2020-21. The share of unit-linked products in total premium marginally decreased to 14.47% in 2020-21, against 14.50% in 2019-20. The year was affected with Covid-19 pandemic.
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Traditional products grew 13.40% in 2019-20 with a premium of Rs 4.90 trillion, against Rs 4.32 trillion in the previous fiscal. ULIPs registered a growth of 9.05%, with premiums increasing from Rs 76,152 crore in 2018-19 to Rs 83,000 crore in 2019-20. “The share of unit-linked products in total premium marginally decreased to 14.50% in 2019-20 as against 14.99% in 2018-19,” according to the Irdai report.
Significantly, profits of the life insurance industry declined 10.50% in the last financial year, with profit after tax of Rs 7,751 crore, compared with Rs 8,661 crore in 2020-21. “Out of the 24 life insurers in operation during 2021-22, 15 companies reported profits. LIC reported an increase in profits by 39.39%, while private insurers together reported a loss of 35.62% in 2021-22,” the report said.
During 2021-22, the net loss of the general and health insurance industry stood at Rs 2,857 crore. It has posted a net profit of Rs 3,853 crore in 2020-21. Out of the four public sector insurers, one reported a net profit and three reported a loss after tax during the year under review. New India Assurance, the market leader in the non-life insurance space, reported a net profit of Rs 164 crore, against a net profit of Rs 1,605 crore in 2020-21. National Insurance Company, Oriental Insurance Company and United India Insurance reported losses of Rs 1,675 crore, Rs 3,115 crore and Rs 2,136 crore, respectively.
“Among the 20 private general insurers, while 13 companies reported PAT, the remaining seven companies incurred losses during the year 2021-22. Out of the five standalone health insurers, only one has reported PAT and the remaining four companies have incurred losses during the year 2021-22,” the annual report said.
Both the specialized insurers – Agriculture Insurance Company of India and ECGC – reported a net profits of Rs 738 crore and Rs 875 crore, respectively, in FY22, compared with Rs 490 crore and Rs 460 crore, respectively, in FY21.
