Quick Summary
The recent GST exemption on life insurance premiums could limit profit growth for insurers in the July-September 2025 quarter, even as the industry experiences a surge in new business. WithITC no longer applicable on existing policies, analysts expect flat or modestly improved margins, despite higher sales volumes. September Shows Robust New Business Premium Growth The life insurance sector saw a strong recovery in September 2025, with new business premiums (NBP) rising 14.8% year-on-year to
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FAQ :
Life insurance new business premiums (NBP) rose by 14.8% year-on-year in September 2025, reaching Rs 40,206.7 crore, reversing a previous decline.
The GST exemption means insurers can no longer claim Input Tax Credit (ITC) on existing policies, which is expected to reduce new business margins by an estimated 165-400 basis points.
The group single-premium segment led the growth in September 2025, helping to offset declines seen in individual policies.
No, smaller or unlisted insurers could experience more pronounced effects from the absence of ITC.
Medium-to-long-term growth prospects remain positive, supported by private insurers expanding into new regions and launching digital platforms to increase penetration and accessibility.
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