LICs APMs in the debt portfolio decrease, persistence ratio improves in FY21


Prior to its IPO, state-owned Life Insurance Corporation (LIC) saw a reduction in non-performing assets (NPAs) in the debt portfolio and improved its persistence ratio, both in month 13 and month 61. month.

In FY21, the gross NPAs of LICs decreased by 39 basis points (bps) to 7.78% from 8.17% a year ago. On the other hand, the insurer’s net NPA decreased by 74 basis points to 0.05% in FY21, indicating that the insurer has made significant efforts to reduce its net NPAs in order to clean up its balance sheet.

The 13th month persistence rate, which is the proportion of policyholders who continue to pay their renewal premium, in terms of number of policies, rose to 67% in FY21 from 61% in FY20. In terms of annualized premiums, the ratio rose to 79 percent from 72 percent earlier.

Likewise, persistence to the 61st month improved to 48% during FY21, compared to 44% during FY20 in terms of number of policy terms, and in terms of annualized premiums, the ratio fell from 54% to 59%.

The insurer’s total revenue grew 10.7% to about $ 6.82 trillion in FY21, from about $ 6.16 billion in FY20. The insurer’s net premiums in FY21 were about $ 4.3 trillion, up 6.33% from about $ 3.79 billion in FY20.

While first year premiums fell 41.4%, renewal premiums increased 8.82% and one-time premiums increased 25%.

LIC’s after-tax profit (PAT) increased 6.9% to approximately 2,906.77 crore in FY21 and the PAT to total revenue ratio remained the same at 0.004.

LIC’s return on investments for FY21 was 7.42 percent compared to 7.54 percent in FY20. Its gross interest, dividend and rent income in FY20. in fiscal year 21 was about $ 2.34 trillion, up 8.33% from about $ 2.16 trillion.

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