GST rate cut uncertainty hurts life insurers’ new business 22% in Dec.

• Life insurers’ new business declined 22% YoY in December to ₹30,218.71 crore.

• The decline is attributed to uncertainty over indirect tax levies on insurance policies, tight liquidity conditions, and a general economic slowdown.

• The drop in new business is a deepening contraction from November, when it fell for the first time in 2024-25 by 4.5% to ₹25,306.56 crore.

• The new surrender value norm, effective from October, is a contributing factor to the downward trend.

• Private players saw a 7% increase in new business to ₹16,694.85 crore.

• LIC’s new business was down more than 41% to ₹13,523.87 crore in December 2024, but its nine-month tally was 7.16% higher than the previous year.

• Regulatory uncertainties over the banca channel and implementation of new surrender regulations are likely to impact growth trends.