The brokerage expects 15-45 per cent growth in VNB (value of new business or new premia sales) for listed insurers in Q3.
While individual APE of private players rose 28 per cent year-on-year to Rs 15,334.4 crore in the December 2021 quarter, their total APE jumped 29 per cent to Rs 16,620.6 crore.
For the industry, total individual APE rose 20 per cent to Rs 23,340.8 crore driving total APE up by 18 per cent to Rs 27,325.2 crore in the quarter, according to the report.
Annual premium equivalent (APE) is a common sales measure calculation used by life insurance companies and is the sum of the total value of regular or recurring premia plus 10 per cent of any new single premia written for the fiscal.
Individual APE for private players bounced back to 15 per cent in December after 9 per cent growth in November, to end Q3 at 14 per cent and nine months at 11 per cent, the report said on Monday.
The growth chart was led by Max Life, which rebounded from Q2 lows with individual APE at 25 per cent in Q3, while SBI Life was broadly in line with industry average after gaining share in the previous quarter, and HDFC Life remained ahead at 19 per cent. However, ICICI Prudential Life was weak and lagged peers despite a low base.
The report attributes continued momentum in non-par savings, strong ULIP sales and likely push of protection products prior to tariff hikes from first half are likely supported growth the quarter, for the strong growth in three months to December.
HDFC Life continues to lead the market with an overall two-year APE growth of 17 per cent in December compared to 14 percent for other private players, driven by stronger previous year. On the other hand, ICICI Prudential Life continued to show weak numbers in November and December despite lower base, its individual APE was up 11 per cent in December compared with 29 per cent for private players.
According to the report, the strong Q3 numbers were driven by ULIPs on the back of robust capital markets, protection products and the continued momentum in savings policies. Protection APEs have picked up sequentially as individual non-single sum assured also rose as most companies are likely raise protection tariffs from April.
The brokerage believes that pick-up in protection APE on a quarterly basis and strong demand for savings products will likely support the VNB margin offsetting the impact of traction in low-margin ULIPs.