LIC gains 2% market share in new business premium in April-June quarters – Business Standard

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Life Insurance Corporation | LIC
Subrata Panda  |  Mumbai 

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Corporation (LIC) has gained over 200-basis points (bps) market share in new business premium (NBP) during the April-June quarter of FY23.
According to Regulatory and Development Authority of India (Irdai) data, at the end of the June quarter, LIC’s market share in NBP stood at 65.42 per cent, compared to 63.25 per cent at the end of FY22.
However, its market share is still below the FY21 and FY20 levels. In FY21, LIC’s NBP market share was 66 per cent, while in FY20, it was 69 per cent.
NBP is the premium acquired from new policies for a particular year.
remains the most dominant player in the life industry for over 20 years.
However, does not enjoy a similar market share on an annualised premium equivalent (APE) basis.
In FY22, LIC’s market share was 46 per cent in APE terms. It stood at 49 per cent in FY21 and 59 per cent in FY20.
has a high share of single premium products due to its large group business. In fact, single premiums constitute over 70 per cent of its NBP. For private sector players, it is 20-30 per cent of their NBP.
Covid-related disruptions posed distribution challenges for LIC initially, given it has always been an agency-driven institution.

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However, it quickly invested in its digital infrastructure and managed to get its distribution network back on track.
LIC had been losing ground to private players because of diversifying its portfolio mix. Now, LIC is also looking to diversify its product mix and reduce reliance on par products.
It is looking to introduce more non-par products in the market.
On an APE basis, non-par is about 7 per cent of LIC’s portfolio and it plans to take it up to 12-15 per cent in 3-4 years. LIC is also looking to diversify its distribution strategy by focusing more on the bancassurance channel.
Currently, around 3-3.5 per cent of its business comes from the bancassurance route.
In the next five years, it wants bancassurance to contribute at least 15 per cent to the business. An email sent to LIC did not elicit a response.
In an interview to Business Standard last month, LIC chairperson MR Kumar had said, “LIC is a very large institution and we have come out of every tough situation stronger. In fact, post Covid recovery is a sign of our resilience and I hope the current rise in Covid does not really disrupt the way the first two waves did. We are confident that we will be able to retain the market share of 60-65 per cent that we have been able to achieve over a period of time.”
LIC’s shares closed at Rs 708.05 a piece on the BSE on Friday, up 1.42 per cent from the previous day’s close.
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First Published: Fri, July 08 2022. 20:24 IST
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