Life Insurance Corporation (LIC) has disclosed that the complete variety of particular person and group insurance policies has witnessed a decline due to the COVID-19 pandemic.
“Our complete variety of particular person insurance policies and group insurance policies (in phrases of lives insured) issued in India decreased by 16.76 per cent from 75 million for fiscal 2019 to 62.43 million for fiscal 2020 and additional decreased by 15.84 per cent to 52.54 million for fiscal 2021,” in accordance to the draft crimson herring prospectus (DRHP) filed by LIC.
The pandemic and the associated lockdowns adversely affected gross sales of particular person insurance policies primarily in the fourth quarter of the monetary 12 months 2019-20, down 22.66 per cent to 6.35 million insurance policies from 8.21 million insurance policies in the year-ago interval, it stated.
At the similar time, influence was seen in first quarters of fiscal 2021 and financial 2022 because it got here down from 46.20 per cent to 1.91 million insurance policies to 34.93 per cent to 2.31 million insurance policies.
LIC bought 3.55 million insurance policies in the first quarter of fiscal 2019, it stated.
In a bid to beat the lockdown, LIC commenced the issuance of digital insurance policies from 2020.
In the wake of rising COVID-19 scenario and in view of adopting digital technique of doing enterprise in the pursuits of policyholders and different stakeholders, IRDAI allowed an exemption from the requirement to situation the policy doc and replica of proposal kind in bodily format, it stated.
The persistency ratios decreased as at March 31, 2020. Persistency ratio is the proportion of enterprise that’s retained from the enterprise underwritten and is measured in phrases of the variety of insurance policies and premiums underwritten.
The insurance coverage claims by loss of life elevated throughout the pandemic, it stated.
It added that for the monetary 12 months 2019, fiscal 2020, fiscal 2021 and the six months ended September 30, 2021, insurance coverage claims by loss of life in advantages paid (web) have been Rs 17,128.84 crore, Rs 17,527.98 crore, Rs 23,926.89 crore and Rs 21,734.15 million, respectively, on a consolidated foundation, which have been 6.79 per cent, 6.86 per cent, 8.29 per cent and 14.47 per cent of complete insurance coverage claims, respectively.
“The extent to which the pandemic will proceed to have an effect on our enterprise, monetary situation, outcomes of operations and money flows in the future will rely upon future developments, that are unsure and can’t be predicted, together with the scope and period of the pandemic and actions taken by governmental authorities and different third events in response to the pandemic,” it stated.
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