According to the figures released by the IRDA for the month of Oct’08, life insurance industry premium growth has turned negative for the first time in the current financial year. The industry growth for the month of October’08 was a negative 6.73% compared with the corresponding figures of last year. Clearly, the life insurers have started to feel the pinch of the slowing economy and sharp fall in equity markets. On the year-to date basis (April-Oct’08), the life insurance industry grew just a marginal 2.77% YoY.
While LIC growth was a negative 15.54% on a year-to date period, private players Kotak premium growth was 100.17%, Reliance 99.78%, SBI 85.57% and Birla Sun Life grew 78.3 %.
Life insurers are the biggest players in the domestic institutional investors. Infact, in FY08, they even topped FII’s by investing close to Rs 55,000 crs in the equity markets.