After witnessing a double-digit contraction in new business premium (NBP) in July, life insurers are back in the green again, witnessing a marginal year-on-year (YoY) growth of 3% in NBP in August, owing to a strong performance by the private insurers.

In July, life insurers reported an 11% YoY drop in NBP while in June they managed to report a 7.53% increase in NBP, following a dip in May due to the second wave of the pandemic.

The life insurance industry reported NBP to the tune of Rs 27,820.74 crore in August, up 2.88% YoY, despite a 3.8% YoY contraction reported by state insurance behemoth -- Life Insurance Corporation (LIC) -- in NBP as private insurers posted 21% YoY growth in NBP. NBP is the premium acquired from new policies in a particular year.

Private insurers, 23, earned Rs 8,859.97 crore in NBP in August 2021 compared to Rs 7,325.58 crore in August 2020, and Rs 6,440.65 crore in August 2019. On the other hand, LIC earned NBP to the tune of Rs 18,960.77 crore in August 2021 compared to Rs 19,714.21 crore in the same period last year and Rs 17,114. 32 crore in August 2019.

Among top private insurers, apart from HDFC Life, which saw 6% YoY decline in NBP in August, SBI Life, ICICI Prudential, and Max Life saw their NBP rise by 23.9%, 43%, and 16.5% respectively.

Compared to the pre-pandemic period (August 2019), NBP of the life insurance industry witnessed an 18% increase, with LIC NBP growing by 10.8% and private insurer's NBP posting a stellar growth of 37.56%.

On a year-to-date (YTD) basis, the life insurance industry saw a marginal 1.63% YoY growth in NBP to Rs 1 trillion . While LIC's NBP till August totaled Rs 66,592.38 crore, down 6.6% YoY, private insurers saw their NBP rise 23% YoY to Rs 34,388.33 crore.

In the first quarter of FY22, the premium collection of the life insurance industry was up almost 7% to Rs 52,725.26 crore YoY, aided by a stellar 33.73% growth registered by the private insurers. However, LIC's NBP in Q1FY22 declined 2.5% YoY to Rs 35,600.68 crore.