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Life insurers cut expenses, invest Rs 44,358 cr in equity; ULIPs in demand
12/2/2010
Expenses of life insurance companies have dropped significantly to 10.14 per cent for the period ended December 2009 as compared to 12.24 per cent for the corresponding period of last year, as per the data released by Life Insurance Council. They also invested Rs 44,358 crore in equities in the April-December period.
Renewal premium of the industry increased from Rs 79,168 crore to Rs 96,917 crore, an increase of 22 per cent on y-o-y. In the case of ULIPs, the renewal premium increased by 41 per cent to Rs 37, 543 crore from Rs 26, 638 crore, indicating the popularity of this instrument.
According to S B Mathur, Secretary General, Life Insurance Council, The drop in expenses was possible due to effective cost-cutting measures adopted by the life insurance industry, by curtailing operating expenses and rationalising their distribution channels coupled with an increase in total premium to Rs 164,353 crore from Rs 131,382 crore, an increase of 25 per cent.
The total infrastructure investment made by life companies stood at Rs 1,30,009 crore. Equity investment of life companies was in tune of Rs 44,358 crore for the period April-December 2009.
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