BENGALURU (Reuters) – India’s SBI Life Insurance Co Ltd reported a near-flat quarterly profit on Friday as higher expenses offset a surge in premium income.
SBI Life, one of India’s largest life insurers, reported profit after tax of 3.8 billion rupees ($45.66 million) for the three months ended Sept. 30, compared with 3.77 billion rupees a year earlier.
Net premium income rose 21.7% to 200.5 billion rupees from 164.77 billion rupees, while expenses surged 22.1%, mainly due to higher commissions and rewards during the quarter.
The insurer did not mention whether the commissions and rewards were for employees or agents.
The value of new business, which measures expected profit from new premiums and is a key gauge for growth, rose 12% during the first half of the year from the same period a year earlier.
Last week, smaller rival ICICI Prudential Life Insurance reported a 22.4% jump in quarterly profit, while HDFC Life Insurance posted a 15.5% increase on strong premium growth.
Analysts say insurers are seeing robust policy sales despite an increase in taxes on high-value products, thanks to growing awareness in the largely underpenetrated market.
Embedded value, a measure of future cash flows for life insurers and a key financial gauge, stood at 512.6 billion rupees at the end of the first half of the year, rising 21% from a year earlier.
Total annualised premium equivalent, a closely watched metric of insurance sales, rose 21% in the first half of the fiscal year 2024, the company said.
($1 = 83.2214 Indian rupees)
(Reporting by Sethuraman NR in Bengaluru; Editing by Sohini Goswami)