Page 17 - Insurance Times July 2024

we will have certain products catering Rs 27,034.2 crore in May 2024 Rs 2,414.13 crore. HDFC Life
to particular segments. So, this year compared to Rs 23,477.8 crore in the Insurance's premiums rose by 13.98
we will find different varieties of year-ago period. LIC's premiums per cent Y-o-Y to Rs 2,270.88 crore.
products to cater to various increased by 18.7 per cent to Rs ICICI Prudential Life Insurance
segments," he said. 16,690 crore in May 2024 from Rs
increased by 32.63 per cent Y-o-Y to Rs
14,056.3 crore a year ago on the back 1,317.75 crore, while Max Life
Kotak bank can sell stake of strong growth in its group business. Insurance recorded 23.25 per cent
in insurance arm The private insurance companies growth at Rs 673.88 crore.
posted a 9.8 per cent Y-o-Y increase in
Kotak Mahindra Bank said it has first-year premium to Rs 10,343.8 crore The number of policies issued by the
received the RBI approval to sell a 70 from Rs 9,421.51 crore. insurer in the month increased by 12.45
per cent stake in its general insurance per cent Y-o-Y in May 2024 to 1.9
arm to Zurich Insurance Company. The group premium segment of the life million as against 1.7 million policies
insurance industry increased by 13.14 sold in the year-ago period.
In November last year, Zurich per cent Y-o-Y to Rs 16,766.71 crore.
Insurance Company announced plans LIC's overall group premium product
to acquire a 51 per cent stake in Kotak registered 20.9 per cent growth to Rs Life insurers' margins may
Mahindra General through a 12,632.26 crore from Rs 10,448.74 take a hit on early
combination of capital infusion and crore in the year-ago period.
share purchase, followed by a surrender directive
subsequent acquisition of an additional The individual premium of the industry Insurance companies are likely to
stake of 19 per cent within three years rose by 18.6 per cent to Rs 10,267.4 offset the impact of increased
from the initial acquisition for Rs 5,560 crore in May. Private life insurers, surrender value by changing
crore. which have a higher share in the commission structures and revising the
segment, posted 23 per cent growth Internal Rate of Returns (IRRs),
"...the Reserve Bank of India has, vide to Rs 6,209.3 crore in May as according to analysts and experts.
its letter dated June 4, compared to Rs 5,051.29 crore in the
2024...conveyed its approval for the same month last year. According to a research note by Emkay
transaction. All regulatory approvals Global Financial Services,
required for the transaction have now SBI Life Insurance, India's largest "Undoubtedly, the impact of this
been received...," Kotak Mahindra private insurer, saw a marginal decline enhanced surrender value, on ceteris
Bank said in a regulatory filing. of 2.48 per cent in new business paribus, is going to be material on non-
premiums to Rs 2,354.33 crore from par savings products. However, this
Kotak Mahindra General Insurance is
a 100 per cent subsidiary of Kotak
Mahindra Bank. Life Insurance Company told to offer surrender

As per the current regulatory value on policies from 1st year
guidelines, a foreign entity can own up IRDAI has asked insurance companies to offer a surrender value from the
to 74 per cent in an insurance venture first year itself, a move that could impact their margins.
in India.
The regulator issued a master circular, which mandates insurers to pay
Life insurers' new business special surrender value (SSVs) after the first policy year, provided one full
year's premium has been received.
premium grew 15.5% in For policies with limited premium payment terms of less than five years and
May single premium policies, SSVs become payable immediately after receipt of

The life insurance industry's new the first full-year premium or single premium.
business premium (NBP) increased by Previously, the surrender value for guaranteed return products was zero in
15.5 per cent year-on-year (Y-o-Y) in the first year and up to 30-35% in the second and third years. The new
May 2024, aided by growth across regulations propose introducing benefit payouts in the first year, which will
segments, according to Life Insurance affect the margins of life insurance companies. However, some insurers
Council's data. believe the impact may be minimal, as over 85% of policies tend to remain
The industry earned premiums worth active beyond the early years.

16 July 2024 The Insurance Times