India’s life insurance industry is expected to sustain its growth momentum in the 2027 financial year, with retail annualised premium equivalent (APE) projected to increase by 11-12 per cent, according to a report by Emkay Research.
Private life insurers are expected to remain the main contributors to industry-wide expansion. Their retail APE is forecast to grow by 13-14 per cent in FY27, compared with an estimated 7-8 per cent increase for the Life Insurance Corporation of India (LIC), the brokerage said.
The outlook follows a strong performance in August, when retail APE across the life insurance industry rose by around 14 per cent year on year. Private insurers posted growth of approximately 15 per cent, while LIC recorded around 13 per cent growth. However, the report noted that LIC’s performance benefited from a relatively low base in the corresponding period a year earlier.
Looking beyond the annual comparison, the sector also maintained positive momentum on a two-year compound annual growth rate basis. Industry-wide retail APE increased by around 7 per cent in August on this measure. Private insurers recorded growth of approximately 8 per cent, while LIC registered around 4 per cent.
The April-August period also showed sustained expansion. Retail APE for the industry increased by around 14 per cent during the first five months of the financial year. Private insurers grew by approximately 13 per cent, while LIC reported stronger growth of around 15 per cent over the same period.
LIC also strengthened its position in the retail weighted received renewal premium (RWRP) segment. Its market share increased by around 40 basis points to 29.9 per cent, according to the report. RWRP is an important measure of an insurer’s renewal premium collection and provides an indication of the strength and persistence of its existing business.
Among major listed private insurers, SBI Life emerged as the fastest-growing player in August. Its retail APE increased by around 22 per cent year on year. HDFC Life followed with growth of approximately 17 per cent. ICICI Prudential Life recorded around 11 per cent growth on an RWRP basis.
Growth was comparatively slower at some other private insurers. Axis Max Life posted an increase of around 10 per cent, with Emkay attributing the moderation partly to a slowdown in its agency channel. Canara HSBC Life recorded approximately 6 per cent growth, although the company was comparing against a relatively high base.
The broader new business picture was also encouraging. Total retail and group new business premium, measured on an RWRP basis, increased by 9.1 per cent year on year in August. Private insurers led this segment with growth of 12.7 per cent, while LIC recorded a more modest 3 per cent increase.
The continued expansion in retail premiums suggests that demand for individual life insurance products remains an important source of growth for the industry. Private insurers, in particular, have benefited from established distribution networks and their ability to reach customers through multiple channels.
Despite the positive operating trends, life insurance stocks remain under pressure amid concerns surrounding forthcoming commission regulations. Changes to commission structures can affect insurers and their distribution partners, making regulatory developments an important consideration for investors assessing the sector.
Emkay Research, however, retains a positive view of the industry’s growth prospects. The brokerage believes current valuations do not fully reflect the strengths of life insurance companies, particularly their brands, distribution capabilities and scale.
Private insurers are therefore expected to remain at the forefront of India’s life insurance expansion in FY27. Healthy retail demand, combined with established distribution networks, is likely to support the sector even as companies navigate regulatory changes and shifting market expectations.
