Supply-side constraints weigh on retail protection biz for life insurers

Persisting supply-side constraints because of the Covid pandemic and the rate hikes taken by reinsurers over the past two years have impacted growth of the retail protection business of life insurance companies. Yet, the protection segment, overall, has witnessed decent growth, mainly because of strong traction in the credit life business, buoyed by disbursement from banks and NBFCs. 
 

Two of the largest private sector life insurance companies, which announced their earnings recently, have witnessed a contraction in their retail protection business. While HDFC Life’s saw a 34 per cent year-on-year (YoY) decline in Q1 on an annualised premium equivalent (APE)