State-owned Life Insurance Corporation (LIC) reported a manifold increase in its net profit in the December quarter (Q3) of financial year 2022-23 (FY23), aided by a transfer of INR 5,670 crore from non-participatory to shareholders\u2019 accounts. Its net profit in Q3 stood at INR 6,334.19 crore, compared with INR 234.91 crore in the year-ago period.<\/p>\n\n\n\n
In the nine-month period (April-December FY23), the corporation\u2019s profits soared to INR 22,970 crore, compared with INR 1,672 crore a year ago. The huge jump was because of the transfer of INR 19,941 crore to shareholder accounts over the last four quarters.<\/p>\n\n\n\n
LIC reported a net premium income of INR 1.11 trillion in Q3, up 14.51 per cent year-on-year (YoY) from INR 97,620.34 crore a year ago, with the first-year premium income rising 11 per cent YoY to INR 9,724.71 crore, renewal premium increasing 6 per cent YoY to INR 60,194.87 crore, and single premium income jumping 30 per cent YoY to INR 42,117.10 crore. Value of new business margin, a measure of profitability of life insurance companies, stood at 14.6 per cent for the nine months of FY23, which was the same at the end of the September quarter (6MFY23), despite a rise in the share of non-par business in its portfolio.<\/p>\n\n\n\n
\u201cWithin the non-par segment, there are different types of businesses. Non-par savings has a higher contribution to margins but that part of our business has not grown, whereas unit-linked plans (ULIPs) have grown. Therefore, the overall margin has not grown,\u201d said KR Ashok, executive director, actuarial, LIC.<\/p>\n\n\n\n
\u201cLately, we have come out with many non-par products. We could see changes in the non-par bucket on a quarterly basis because most of our agents are getting used to these new products. We need 1-2-year visibility before things happen as we want them to. As of now, we are focused on non-par products and we leave it to the customers as to what they want to buy \u2013 annuity, ULIP, or term,\u201d said MR Kumar, chairperson of LIC. He said LIC would reach 25 per cent margins faster than its private sector rivals. \u201cWe have come from 9 per cent to 14.6 per cent in hardly any time,\u201d Kumar added.<\/p>\n\n\n\n
LIC earned a total premium of INR 37,545 crore on an APE (annualised premium equivalent) basis for the nine months ended December 31. Of this, INR 23,419 crore was accounted for by the individual business and INR 14,126 crore by the group business. In the Individual business, the share of non-participatory business increased to 9.45 per cent for the period, compared with 7.12 per cent in the whole of FY22.<\/p>\n\n\n\n
Asked if LIC had reduced its exposure to Adani Group companies in light of allegations made by a US-based short seller, the chairperson said: \u201cWe buy and hold for the long term. As of now, we don\u2019t plan to do anything. We will take a view may be few years down the line.\u201d \u201cOur investment department has already reached out to them (Adani Group),\u201d Kumar said. LIC had earlier said that it would look to engage with the group\u2019s management and seek clarification on the report.<\/p>\n\n\n\n
Last month, LIC clarified that it has invested INR 36,474.78 crore so far in the group through both equity and debt. Total purchase value of equity, bought over many years, in the group companies is INR 30,127 crore. LIC\u2019s exposure in the Adani group, as on date, is 0.975 per cent of LIC\u2019s total AUM at book value, the insurer said.<\/p>\n\n\n\n
Assets under management (AUM) increased to INR 44.34 trillion as on December 31, 2022, compared with INR 40.12 trillion in the year-ago period, registering an increase of 10.5 per cent.<\/p>\n","protected":false},"excerpt":{"rendered":"
State-owned Life Insurance Corporation (LIC) reported a manifold increase in its net profit in the December quarter (Q3) of financial year 2022-23 (FY23), aided by a transfer of INR 5,670 crore from non-participatory to shareholders\u2019 accounts. Its net profit in Q3 stood at INR 6,334.19 crore, compared with INR 234.91 crore in the year-ago period. […]<\/p>\n","protected":false},"author":1863,"featured_media":27118,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[392,1],"tags":[8233,11348,9970],"class_list":["post-143066","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-earnings","category-finance-stocks","tag-insurance-services","tag-investment","tag-life-insurance"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/alphastreet.com\/india\/wp-content\/uploads\/2019\/04\/Earnings-preview-1.jpg","jetpack_likes_enabled":false,"jetpack-related-posts":[{"id":139061,"url":"https:\/\/alphastreet.com\/india\/syngene-reported-a-5-rise-in-its-net-profit-for-q3fy23\/","url_meta":{"origin":143066,"position":0},"title":"Syngene reported a 5% rise in its net profit for Q3FY23","author":"Chirag Gupta","date":"January 24, 2023","format":false,"excerpt":"Syngene International reported a 5.5% rise in consolidated net profit to INR 109.70 crore in Q3 FY23 as against INR104 crore posted in Q3 FY22. 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