Chennai, March 11 (IANS): Indian life insurers after a robust growth in FY23, their first-year premium numbers in FY24 have been moving in a subdued manner, said credit rating agency CARE Ratings in its latest report.

However, for February 2024, first-year life insurance premiums witnessed a surge of 48.4 per cent, compared to a fall of 16.8 per cent witnessed in the same period last year.

The increase can be attributed to group single premiums, especially of LIC and strong monthly performance of the private insurers.

Meanwhile, year-to-date (YTD) FY24 new business premiums of life insurers narrowed their drop to 0.2 per cent compared to the growth of 25.1 per cent growth in YTDFY23.

The year-on-year (y-o-y) decline can be attributed to the introduction of a new tax regime, a reduction in group premiums, and the significant momentum experienced in March 2023, the report notes.

While private insurance companies have maintained growth and have continued to play a mitigating role by counteracting the dip in Life Insurance Corporation of India’s (LIC) premiums, their pace has been subdued compared to the prior year, CARE Ratings said.

Most companies including LIC have reported robust growth for the month of February 2024. LIC recorded an increase of 67.5 per cent in February meanwhile as a whole, the private insurers recorded growth of 27.8 per cent.

On the other hand, for the year-to-date period, private companies have continued their growth compared to LIC’s fall. The aggregate decrease can continue to be attributed to higher momentum in March 2023, reduced single premiums, primarily LIC and changes in the tax regime.

However, the aggregate decrease has been narrowing as companies chase business aggressively and could end flat or marginally positive as the fiscal year draws to a close.