(Reuters) -India’s SBI Life Insurance Company posted flat year-on-year fourth-quarter profit on Thursday amid a slowdown in group insurance business.
Profit rose 0.3% to 8.14 billion rupees ($95.5 million) for the quarter ended March 31 from 8.10 billion rupees a year earlier.
Analysts said heightened competition in the group insurance category has affected SBI Life’s premiums earned in the segment.
Peers ICICI Prudential Life Insurance and HDFC Life Insurance reported a rise in quarterly profit, boosted by their group insurance offerings.
SBI Life’s net premium income fell about 5% to 238.61 billion rupees as single premiums dropped nearly 73% while first-year premiums rose about 7%.
The company’s value of new business (VNB), or expected profit from new policies – one of the key metrics for insurers – rose 10% year-on-year.
Its annualised premium equivalent (APE) sales, which is the total value of all single- and recurring-premium policies, rose 2% to 54.5 billion rupees, as per a Reuters calculation.
Demand for market or unit-linked insurance plans (ULIP) dropped as India’s stock markets underwent a sharp correction.
Market-linked insurance plans, which have a lower profit margin compared to term policies, accounted for 64% of SBI Life’s overall product mix by individual APE during the fiscal year, compared with 60% in the previous fiscal year.
VNB margins contracted to 27.8% for the fiscal year from 28.1% a year earlier.
($1 = 85.2640 Indian rupees)
(Reporting by Shivani Tanna in Bengaluru; Editing by Mrigank Dhaniwala)
