However, fall in individual business continues.
After two years, there was some relief for the life insurance sector as the industry registered a marginal growth of 0.6 percent in premium collection in the month of April 2013. IRDA data shows that the private life insurers have registered a healthy growth of 18.5 percent in premium collection while LIC has again witnessed a fall of 4.7 percent in its premium collection.
Insurance advisors attributed this marginal increase in premium collection to online product selling trends and a robust increase in group single premium collections.
Group business has increased by 41 percent whereas individual segment has recorded a negative growth of 22 percent. LIC has registered increase of 35 percent in the premium collection of group business while its individual segment has recorded a fall of 28 percent. Private insurers have registered 60 percent growth in premium collection in group segment while its individual segment recorded a marginal fall of 3 percent.
Prakash Praharaj, Founder of Max Secure Financial Planners said “The growth in private sector is on account of increase in premium collection of group single segment largely contributed by SBI Life, India First and HDFC Standard Life. Group single premium business is mainly fund management business of gratuity, superannuation etc. Decline in individual business is a matter of concern.The situation may improve with the launch of new products and need based selling.” He also said that the online selling of term insurance products and social networking websites have helped insurance companies to expand their reach.
With a fall of 4.7 percent, the new business premiums of LIC saw a sharper dip than the life insurance industry. LIC collected premium of Rs 3631 crore in April 2013 as compared to Rs 3811 crore in the corresponding period last year.
On the other hand, private life insurance companies have collected Rs 1333 crore in April 2013 against Rs 1125 crore in the corresponding period last year.
According to data issued by IRDA, total new business premium collection of life insurers till April 2013 stood at Rs 4965 crore compared to Rs 4937 crore of April 2012.