India’s vibrant life insurance sector is celebrating a period of strong growth, with new business premiums across the country soaring by nearly 15% in September. The total premium collection hit an impressive ₹40,206.67 crore, a notable increase from the ₹35,020.28 crore recorded during the same month last year.
Interestingly, this surge in first-year premiums occurred despite a considerable year-on-year dip in the sheer volume of policies and schemes sold, which fell from 32,17,880 to 22,06,302.
The market leader, state-owned Life Insurance Corporation of India (LIC), contributed significantly to this growth, posting a 12.70% increase in its first-year premium. LIC’s September collections reached ₹22,957.09 crore, up from ₹20,369.26 crore a year prior.
The 26 private life insurers also demonstrated strong financial health, collectively generating ₹17,249.58 crore in new business. This marks an impressive 17.73% growth compared to their ₹14,651.02 crore premium collection from the previous year.
While both state-owned and private insurers experienced a reduction in the number of policies and schemes sold during the month, LIC saw a more pronounced decrease, with sales dropping to 13,57,908 from 23,51,433. Private players, in contrast, experienced a smaller decline, recording 8,48,394 policies compared to 8,66,447.
According to Saurabh Bhalerao, Associate Director and Head BFSI at CareEdge Ratings, the overall premium growth was primarily fueled by the group business segment, especially single premium policies. This particular segment effectively counterbalanced the decline observed in individual premiums. The dip in individual non-single policies is attributed to a ‘base effect’ and recent surrender value regulations, but Bhalerao anticipates this trend will stabilize in the upcoming months.
He further highlighted that private insurers successfully navigated the reduced policy numbers by strategically increasing the average premium received per policy.
For the broader six-month period ending September, the combined first-year premium for all life insurers saw a 7.64% increase, reaching ₹2,03,668.19 crore, up from ₹1,89,214.04 crore. However, the total number of policies and schemes sold during the first half of the fiscal year was more than 14% lower, standing at 1,14,56,428 compared to 1,33,68,856, as detailed in the data released by the Life Insurance Council.
During this half-year, LIC’s new business expanded by 4.72% to ₹1,21,008.19 crore (from ₹1,15,549.88 crore), while private players recorded a more substantial 12.21% increase, reaching ₹82,660 crore (from ₹73,664.16 crore).
The life insurance sector is looking ahead to significant changes with upcoming GST reforms in October 2025. These reforms are expected to improve affordability, expand coverage for existing customers, and attract new policyholders. Bhalerao forecasts a gradual recovery throughout the 2026 fiscal year, supported by private insurers’ strategic efforts to enhance their geographical reach and the launch of innovative initiatives like the ‘Bima Trinity,’ which includes the Bima Sugam digital marketplace.