Saturday January 3, 02:34 AM

Source: Indian Express Finance

Insurance collection falls for 2nd month

By ENS Economic Bureau
Jittery investor confidence and slackening demand seems to be spoiling the party for private life insurance companies. According to the latest data released by the Insurance Regulatory and Development Authority (IRDA), the first year premium collection for November 08, for the industry is down by 7 per cent to Rs 5,652.39 crore compared with Rs 6,081.16 collected last year. This is for the second consecutive month that the industry has witnessed a negative growth in first year premium collection. After growing by as much as 56 per cent in September this year, the life insurance industry started its downward journey from thereon. Compared with last year, the first year premium collection was down by 6.7 per cent to Rs 5,087 crore in October. For November, the collections have slid further by 7.1 per cent to Rs 5,652.39 crore. The private sector companies, which were fast eating into the market share of lone public sector insurer LIC, collected Rs 2,306.01 crore in November as first year business premium. The collection is down by 10.6 per cent as compared with the same period last year when the sector garnered Rs 2,580.45 crore. Life Insurance Corporation of India (LIC), on the other hand, is gaining strength again. The insurance giant collected Rs 3,346.39 crore in November, which is 4.4 per cent lower than last year. Of the 16 life insurance companies that have spent at least one year in business, nine witnessed a fall in their premium collections. SBI (SBIN.NS : 2242.9 -11.75) Life Insurance, which has grabbed the position of the biggest player in the private space, was the biggest gainer in November as its premium collection grew by 49 per cent. October and November are generally lean periods for the industry. You will see a change in collection figures for the next four months. Generally it is the last quarter of each financial year that brings in most of the business for the companies, says Darvesh Panchal, practice leader, Prudent Brokers.