Shares of life insurance companies will help you earn money; SBI Life, HDFC Life, LIC, where will you get more returns

Life Insurance Shares : The life insurance sector continues to grow strongly. In June, the total premium of the sector grew 14.8 per cent on an annual basis to Rs 42434 crore. In June, the total annualized premium equivalent (APE) grew by 27 per cent and the retail annualized premium equivalent (APE) grew by 34 per cent. At the same time, in the June quarter of the financial year 2024-25, the new business premium of life insurance companies grew by about 23 per cent to Rs 89,726.7 crore, from Rs 73,004.87 crore in the same quarter a year ago. At present, the growth of the life insurance sector is expected to remain better in the future as well. In such a situation, the stocks of some companies can also perform well in the future.

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Which company earned how much

In the June quarter, the country’s largest life insurance company LIC’s new business premium has seen the highest jump of 28 percent. At the same time, the new business premium of private sector companies has also seen a jump of 14.6 percent. LIC’s premium in the June quarter was Rs 57,440.9 crore due to the increase in group premium. While the group single premium was Rs 44,671.86 crore.

Talking about private companies, the premium of SBI Life Insurance increased by 13 percent to Rs 7032.69 crore. The premium of ICICI Prudential Life Insurance increased by 23.5 percent to Rs 3768.55 crore. While HDFC Life, Bajaj Allianz Life Insurance and Max Life Insurance registered growth of 9.19 percent, 17.78 percent and 11.87 percent respectively.

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Top Pick in the Sector

Brokerage House Motilal Oswal According to IRDAI, new rules regarding surrender value have been announced which will be implemented from 1 October 24. There may be significant changes in product and commission formulation, which may lead to volatility in premium growth for the remaining financial year. Nevertheless, in the mid-term, the brokerage believes that these changes are favorable for customers and will bring back growth. The brokerage house has named SBI LIFE and HDFC LIFE as its top picks in the life insurance sector.

Brokerage House ICICI Securities says volume growth for private insurance companies/LIC remained strong at 18 per cent/17 per cent in Q1FY25. During Q1FY25, ICICI Pru reported strong growth in terms of total APE (+34%), followed by Max Life (+24%), HDFC Life (+22%) and SBI Life (+18%).

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Sum Assured Growth (based on April/May 2024 data) Volumes have declined, putting pressure on potential margins. Sum Assured trends for M2FY25 include: HDFC Life (+15%), followed by ICICI Pru (+13%), Max Life (+11%) and SBI Life (+5%). Thus, the Sum Assured to APE ratio for most companies has declined in M2FY25 compared to the first two months on a M2FY24 basis.

HDFC Life/SBI Life and LIC are the relatively better performers in terms of this ratio. LIC recorded a growth of 15% YoY in APE, while SA recorded a growth of 107% in M2FY25. Based on the overall APE growth of 17.5%, LIC could perform strongly in Q1 FY25. 107% growth in sum assured (in 2 months) and 11% growth in number of policies.