Life insurers demonstrated robust value of new business (VNB) growth in FY26, with Life Insurance Corporation of India reporting a 41.63% year-on-year rise to ₹14,179 crore. Among private insurers, SBI Life Insurance posted a 12% increase to ₹6,670 crore, while HDFC Life Insurance recorded a 2% rise to ₹4,034 crore. ICICI Prudential Life Insurance reported a 10.9% increase to ₹2,629 crore, and Axis Max Life Insurance saw VNB grow 26% YoY to ₹2,647 crore. According to reports from Business Standard, VNB serves as a key measure of profitability for life insurers, with higher sales of protection and non-par products lifting profitability despite higher operating costs.
Protection and non-par products typically carry higher margins than unit-linked insurance plans (ULIPs), with their contribution increasing during the year. At SBI Life, the protection segment recorded 10% YoY growth on an annualised premium equivalent basis, with individual protection APE standing at around ₹1,030 crore, up 24% from a year earlier. The individual sum assured in the protection segment rose 62%, as reported by Business Standard. HDFC Life increased the share of protection products in its overall mix to 7% from 5% in FY25, with retail protection business growing 43% during FY26. For ICICI Prudential Life, protection products' share in the product mix rose to 18% in FY26 from 16% in FY25.
In its post-earnings call, SBI Life emphasized focusing on improving the product mix in favor of non-ULIP products across all three segments - non-par, par, and protection. The company stated that this effort aims to improve profitability through a healthy product mix. LIC showed significant improvement with the share of non-par products in the individual annualised premium equivalent mix rising to 35.11% in FY26 from 27.69% a year earlier. As reported by Business Standard, the insurer's continued focus on higher-margin products over the past few years contributed to this substantial increase.
LIC reported overall new business sum assured increased 21.4% YoY to ₹14.50 trillion, while retail new business sum assured rose 35.3% to ₹4.50 trillion. HDFC Life saw retail sum assured rise 28% YoY, with retail protection mix expanding by nearly 200 basis points year-on-year to 7.2%. ICICI Prudential Life management noted that VNB growth was achieved through improvement in product mix and operational efficiencies even after accounting for the unavailability of input tax credit.
