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- LIC’s Q1 FY27 performance reflects growth in premium income, profitability and value creation, while market share remains under pressure
- Individual New Business Premium grows 14.48% to ₹14,351 crore, VNB grows 61.32% and VNB margin improves to 22.9%
The Print Times
Life Insurance Corporation of India (LIC) delivered a strong financial performance during the first quarter of FY27, with growth in premium income, profitability, Value of New Business (VNB), Annualized Premium Equivalent (APE) and assets under management. Addressing the Q1 FY27 earnings conference call, Mr. R. Doraiswamy, Chief Executive Officer and Managing Director, LIC, said the company recorded total premium income of ₹1,27,250 crore for the quarter ended 30th June 2026, compared with ₹1,19,200 crore in the corresponding quarter of the previous year, registering a 6.75% year-on-year growth. The performance was supported by growth across both individual and group business, although LIC’s overall market share by first-year premium income declined to 60.10% from 63.51% during the comparable period.
The market-share movement indicates that while LIC continues to maintain a substantial presence across the Indian life insurance market, competition remains visible, particularly in the group business segment. LIC recorded a 38.89% market share in individual business during the quarter, marginally higher than 38.76% in the corresponding period last year. However, its group business market share declined to 70.90% from 76.54%. The overall market share therefore stood at 60.10%, according to IRDAI, compared with 63.51% in the first quarter of the previous year. The numbers indicate that LIC continued to maintain its leadership across individual and group business segments, even as its relative share changed during the period.
Individual business remained an important growth contributor. Individual new business premium income increased 14.48% year-on-year to ₹14,351 crore, compared with ₹12,536 crore in Q1 FY26. Renewal premium income from individual business also increased 3.61% to ₹61,065 crore from ₹58,938 crore. As a result, total individual premium income, including renewals, increased 5.52% to ₹75,416 crore, compared with ₹71,474 crore in the corresponding quarter of the previous year. Group business also recorded growth, with total group premium income increasing 8.61% to ₹51,834 crore, including new business premium of ₹51,229 crore, compared with total group premium income of ₹47,726 crore and new business premium of ₹46,907 crore in Q1 FY26.
The improvement in the quality and profitability metrics of new business was particularly notable. LIC’s total Annualized Premium Equivalent (APE) stood at ₹13,692 crore, comprising individual APE of ₹7,532 crore and group APE of ₹6,160 crore. Individual business accounted for 55.01% of total APE, while group business accounted for 44.99%. Within individual APE, par business contributed ₹5,085 crore and non-par business contributed ₹2,447 crore. Consequently, the non-par share of individual APE increased to 32.49% from 30.34% in the corresponding quarter of the previous year, while par business accounted for 67.51%.
The most significant improvement was seen in profitability and Value of New Business. Profit after tax increased 22.81% year-on-year to ₹13,492 crore, compared with ₹10,986 crore in Q1 FY26. At the same time, net VNB increased 61.32% to ₹3,136 crore, compared with ₹1,944 crore in the corresponding quarter last year. The net VNB margin expanded by 750 basis points, from 15.4% to 22.9%. The combination of higher VNB and a significantly improved margin indicates a stronger contribution from new business to overall value creation during the quarter.
LIC’s balance-sheet position also strengthened during the period. Assets under management increased 4.10% year-on-year to ₹59,39,384.39 crore as of 30th June 2026, compared with ₹57,05,341.44 crore as of 30th June 2025. The solvency ratio also improved to 2.42 from 2.17, providing an indication of the company’s capital position during the quarter.
On the distribution side, LIC sold 31,02,281 new policies during Q1 FY27, compared with 30,39,709 policies in Q1 FY26, representing a 2.06% increase. The agency channel continued to account for the overwhelming majority of policy sales, with the agency force selling 30,55,909 policies, representing 98.51% of total policies sold during the quarter. On a premium basis, the agency channel contributed 93.07% of new business premium. However, the total number of agents declined to 14,45,692 as of 30th June 2026 from 14,86,222 a year earlier, while the market share by number of agents declined to 43.69% from 47.11%.
LIC’s bancassurance and alternate channels recorded mixed performance. Combined new business premium from these channels, including micro insurance, increased 5.25% to ₹907.14 crore from ₹861.92 crore. Within this, the banking channel recorded new business premium of ₹483.39 crore, down 8.62% from ₹528.97 crore. In contrast, alternate channels recorded new business premium of ₹423.75 crore, registering a significant 27.27% growth from ₹332.94 crore. Combined bancassurance and alternate channels accounted for 6.34% of individual new business premium, compared with 6.89% in the corresponding period last year.
The company’s expense ratio remained broadly stable, although it increased marginally. The overall expense ratio stood at 10.63%, compared with 10.47% in the same period last year, an increase of 16 basis points. Persistency levels showed a mixed movement across different policy durations. On a premium basis, persistency at the 13th, 25th, 37th, 49th and 61st months stood at 75.33%, 69.84%, 67.50%, 64.04% and 61.12%, respectively, compared with 75.63%, 71.53%, 67.17%, 63.45% and 63.85% during the comparable period last year.
Claims remained a significant component of LIC’s operations during the quarter. LIC processed 37,27,812 individual claims, including 35,35,876 claims related to maturity and survival benefits. On an amount basis, maturity claims increased to ₹57,099 crore from ₹50,584 crore, representing a 12.88% increase, while death claims increased marginally to ₹5,934 crore from ₹5,877 crore, representing a 0.97% increase. However, on a number-of-claims basis, maturity claims decreased by 10.94% and death claims decreased by 3.09% year-on-year.
The Bima Sakhi initiative also expanded during the quarter. As of 30th June 2026, 2.87 lakh women had been designated as Bima Sakhis, through whom 4.52 lakh insurance policies were sold, generating new business premium income of ₹656.91 crore. LIC aims to appoint at least one Bima Sakhi in every gram panchayat. Of the 2,44,876 gram panchayats in India, LIC had covered 62%, with Bima Sakhis recruited in 1,51,620 gram panchayats by 30th June 2026.
Overall, LIC’s Q1 FY27 performance was marked by a combination of 6.75% growth in total premium income, 14.48% growth in individual new business premium, 22.81% growth in PAT and 61.32% growth in VNB. The sharp improvement in VNB margin to 22.9%, along with the increase in the non-par share of individual APE to 32.49%, points to changes in the composition of new business during the quarter. At the same time, the decline in overall market share, particularly in group business, and the reduction in the agency base remain important developments within the quarter’s operating performance.
LIC also highlighted the Government of India’s recent 6.5% stake sale through an offer-for-sale, which increased the company’s public float to 10%. According to Mr. Doraiswamy, the OFS was well received by the market, and with the transaction, LIC is compliant with the currently applicable minimum public shareholding norms.
