LIC Sees West Asia Conflict Impeding Insurance Growth Amid Decreased Savings

LIC Expects Growth to Slow Due to West Asia War, Maintains Double-Digit Growth Target

Life Insurance Corporation of India (LIC), the country's largest insurer, is anticipating a slowdown in growth due to the ongoing West Asia war. However, the company remains hopeful of achieving its target of double-digit growth in new business premium. According to a statement made by R. Doraiswamy, managing director and chief executive of LIC, the company will make every effort to maintain its growth rate despite the challenges posed by the crisis.

In the company's earnings call for the fourth quarter and 2025-26, Doraiswamy noted that every sector will be impacted by the crisis, and people's savings, including those through life insurance, may be affected. However, he emphasized that the company will strive to continue moving towards its targeted growth rate.

Key Financial Highlights

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LIC posted a consolidated net profit of ₹23,467 crore for the March quarter, representing a 23% year-on-year growth. The company's consolidated profit after tax rose 19.3% to a record ₹57,419 crore in FY26. Total premium income grew 9.8% on-year to ₹5.4 trillion, driven by an 8.3% rise in new business premium to ₹67,676 crore and a 5.9% increase in renewal premium to ₹2.7 trillion.

The insurer declared a policyholder bonus of ₹59,726 crore for the year. However, LIC's market share shrank 0.4% in terms of premium to 56.7% and 0.7% in terms of the number of policies to 65.2% as of the end of March 2026.

Doraiswamy attributed the decline in market share to the entry of new players in the industry, which led to a shift in market share. He emphasized that LIC's focus should be on its own growth, rather than market share. "We want the pie to grow. We want everyone to grow, and for the industry to be flourishing," he said.

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The removal of goods and services tax (GST) on retail term and health policies helped boost policy sales in the second half of the fiscal year. However, the impact of the surrender value norms implemented in October 2024 continued to weigh on overall growth.

Despite the challenges, LIC has shown a good growth trend in FY27 and April 2026, with a significant increase in the number of policies and premium income. Doraiswamy expressed confidence in the company's performance and stated that the strong results have not been reflected in the share price. He believes that the market will start taking into account the insurer's performance, leading to an increase in share prices in the coming days.