• LIC reported a Q2 net profit of Rs 7,621 crore, a 4% decrease from last year, but showed growth in other areas.
• Net premium income rose by 11% to Rs 1.19 lakh crore, indicating a growing customer base.
• First-year premium income increased 12% year-on-year, suggesting positive future growth prospects.
• Despite a slight decrease in net profit, LIC's Q2 results show significant growth in premium income, investment income, and assets under management.

The Life Insurance Corporation (LIC), India's largest insurer, has reported a standalone net profit of Rs 7,621 crore for the July-September quarter of the current financial year. This figure is a 4% decrease from the Rs 7,925 crore reported for the same quarter last year, according to a regulatory filing by the company. Despite the slight dip in net profit, the company has shown significant growth in other areas.

The net premium income during the second quarter rose by 11% to Rs 1.19 lakh crore, up from Rs 1.07 lakh crore in the same period of the previous year. This increase in premium income indicates a growing customer base and a higher level of trust in the company's services.

Income from investments during the second quarter also saw a substantial increase, rising 16% to Rs 1.08 lakh crore compared to Rs 93,942 crore in the same period last year. This growth in investment income suggests that the company's investment strategies are yielding positive results.

Strong Performance in New Business and Renewal Premiums

The first-year premium income during the second quarter increased 12% year-on-year to Rs 11,201 crore from Rs 9,988 crore in the same quarter of the previous year. This growth in first-year premium income is a positive sign for the company's future growth prospects.

The individual new business premium income for the six-month period ending September 2024 was Rs 29,538 crore, up from Rs 25,184 crore in the same period of the previous year, representing a growth of 17% over the previous year. This growth in new business premium income indicates that the company is successfully attracting new customers.

Individual renewal premium income for the first half rose 5% to Rs 1.15 lakh crore. This increase in renewal premium income suggests that existing customers are continuing to renew their policies, indicating a high level of customer satisfaction and loyalty.

Solid Financial Position and Asset Management

LIC sold a total of 91.70 lakh policies in the individual segment during the first half of the current financial year. On an Annualised Premium Equivalent (APE) basis, the total premium was Rs 28,025 crore in H1FY25. Of this, close to 65% (Rs 18,163 crore) was accounted for by the individual business, and 35% (Rs 9,862 crore) by the group business.

The Value of New Business (VNB) for the six months rose 38% to Rs 4,551 crore compared to the same period last year, with the net VNB margin rising by 160 bps to 16.2%. This increase in VNB and net VNB margin indicates that the company is successfully growing its new business and improving its profitability.

The solvency ratio increased to 1.98 as of September 2024, while the 13th-month and 61st-month persistency ratios stood at 77.62% and 61.46%, respectively. These figures indicate that the company is maintaining a strong financial position and is able to meet its long-term obligations.

LIC's assets under management (AUM) rose 17% to Rs 55.39 lakh crore as of September 2024 compared to the same period of the previous year. This growth in AUM indicates that the company is successfully managing its assets and generating returns for its policyholders.