Insurance Sector Update - Insurance tracker Jun`21 – Gradual recovery across players By Emkay Global
Insurance tracker Jun’21 – Gradual recovery across players
The insurance industry reported some revival in sales during Jun’21, mainly aided by a gradual easing of lockdowns in major cities and the lower base effect of last year. Retail NBP for the industry witnessed ~1% yoy growth, while total NBP recorded ~4% yoy growth. Retail APE for the industry grew ~10% yoy, while total APE grew ~11% yoy. Interestingly, most insurance players witnessed a surge in policy prices, which was the main contributor to growth as number of policies sold remained weak.
* For private players, the trends in group policy sales were better than retail sales trends in Jun’21. Retail APE for private players grew ~16% yoy vs. ~5% growth in May’21. Group APE grew ~1.26x yoy vs. a ~33% decline in May’21.
* On the basis of total APE, the share of private players increased to ~53% from ~50% in May’21. The share of retail APE stood at ~61% vs. ~56% in May’21, while the share of group APE stood at ~37% vs. ~32% in May’21.
* HDFCL: HDFCL reported ~8% yoy growth in APE in Jun’21 to Rs6.8bn. Retail APE remained flat yoy at Rs5.7bn. NBP at Rs16.9bn grew ~25% yoy, mainly supported by a ~73% yoy surge in group sales, while retail NBP declined ~3% yoy. Policy sales declined ~20% yoy; however, the retail ticket size on the APE basis was ~27% higher yoy during Jun’21 as the company has witnessed significant price hikes in H2FY21.
* IPRU: IPRU reported growth of 1.5x yoy in APE to Rs9.4bn in Jun’21 on a low base of last year. Retail APE grew ~43% yoy to Rs4.4bn and group APE grew 6.3x yoy to Rs5bn. NBP at Rs12.6bn grew 1.2x yoy, supported by 4.4x yoy growth in group NBP. Policy sales declined ~2% yoy, while the retail APE ticket size grew ~47% yoy, which was better compared to HDFCL.
* MAXL: MAXL reported APE growth of ~16% yoy to Rs4.2bn. Retail APE grew ~17% yoy to Rs4.15bn. NBP grew ~21% yoy to Rs6bn. Policy sales declined ~11% yoy, while the retail APE ticket size increased ~32% yoy.
* SBIL: SBIL reported ~18% yoy growth in NBP to Rs17.7bn, mainly backed by group NBP, which grew ~20% yoy to Rs8.2bn. APE grew ~14% yoy to Rs8.3bn. Policy sales rose ~11% yoy, while the retail APE ticket size grew ~5% yoy.
* LIC: LIC has reported a ~6% yoy decline in APE. Retail APE grew ~1% yoy to Rs22.7bn. NBP declined ~4% yoy to Rs218bn. Policy sales declined ~3% yoy, while the retail APE ticket size grew ~8% yoy.
We expect the trend to improve further from Jul’21 amid the gradual easing of lockdowns in major cities and the advantage of a low base effect of last year.
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