Mumbai: Life insurance industry witnessed a marginal decline of 3 per cent in the total premium collection at Rs 1,80,240 crore for the period ending December 31, 2011. The total premium collected by industry stood at Rs 1,86,396 crore for the corresponding period of previous year, the Life Insurance Council today said in a release here. The new business premium for the industry also decreased by 17 per cent year-on-year to Rs 71,953 crore from Rs 86,698 crore in the last nine months.
This trend of decreasing new premiums is due to near disappearance of new individual pension policies, it said. As per the provisional figures released by council the total new premium collected under the individual pension category was Rs 1,008 crore compared to Rs 18,417 crore for the same period in 2010 and Rs 19,406 crore in 2009.
The total number of individual pension policies sold also came down to 0.11 million from 3.43 million year-on-year. In terms of inclusive growth, the life insurance industry has covered more than 97.76 lakh lives in social sector and sold 81.6 lakh policies in rural areas as on December 31, 2011.
However, total renewal premium for April-December 31, 2011 has grown at of 9 per cent year-on-year. The renewal premium for traditional policies grew by 14 per cent to Rs 73,162 crore from Rs 63,962 crore last year. The unit-linked renewal premium collection dropped marginally by 1 per cent to Rs 35,070 crore from Rs 35,561 crore.
The life insurance industry has infused Rs 1,977 crore (USD 400 million) as capital in last nine months.
"The infusion of capital in tune of USD 400 million in 9 months indicates that promoters whether foreign or domestic have a long term appetite. As insurance has a long gestation period and companies show losses for first 10 to 15 years, the company's need to be supported by capital," Life Insurance Council Secretary General S B Mathur said. He further said that given the current economic scenario where capital is scarce and foreign promoters want to stay invested in life insurance in India, the time is opportune for increasing the Foreign Direct Investment limit in insurance to 49 per cent.
As per the data, investment in infrastructure by the life insurers stood at Rs 2,06,000 crore till December 31, 2011. The industry continued its focus on providing protection and has paid death benefits to the kin's of the policyholders in tune of Rs 8,057 crore, compared to Rs 7,436 crore last year.
The total number of individual agents till December 31, 2011 were 23.78 lakh from to 27.10 lakh last year. The percentage of new business premium collection from this traditional channel has decreased from 55 per cent last year to 44 per cent this year.