ICICI Life Insurance has posted strong September-quarter (Q2FY27) results. Annualized premium equivalent (APE) grew 15.6% year-on-year to ₹2,799 crore, while value of new business (VNB) rose 20.3% to ₹712 crore. The faster growth in VNB expanded the margin by 98 basis points to 25.4%, largely aided by a better mix of protection (term) insurance products.
The year-on-year comparison also benefits from negative APE growth in Q2FY26. The second half of FY26 had a higher base, owing to a post-GST-exemption led spurt in business, which could weigh on H2FY27 and, consequently, overall growth for FY27.
In the absence of management guidance for FY27, investors must assess whether APE growth momentum can sustain. APE has two components: savings products, which accounted for 80% of Q2FY27 APE, and protection insurance, which contributed the rest.
Savings products APE grew about 12% in Q2FY27. Unit-linked insurance plans (Ulips) contributed more than half of savings APE. But, Ulip premium growth was soft at 6.6% year-on-year to ₹1,266 crore, as sales depends on a recovery in equity markets. Even if stock markets start moving up, there could be a time lag before Ulip growth picks up.
The outlook for savings products excluding Ulip (basically non-linked) is brighter for non-participating policies (policies not allowing policyholders to share insurance company’s profit, but offer guaranteed fixed returns) versus participating policies, as interest rates have been rising.