According to the data collected by the Insurance Regulatory Development Authority (Irda), during 2011-12, life insurance industry sold close to 19.6 million policies, 15.31 per cent lower, compared to 23.14 million policies sold in the same period last year. In the same period, number of policies issued by the private players came down to 4.15 million from 6.34 million.
Pension plans, which consisted of about 30 per cent of the sales, specially for the private players till the new regulations came into force in September 2010, now account for only 1.7 per cent of sales.
With the commissions on unit-linked plans (Ulips) coming down, many agents have left the industry, which has impacted the sales of private life insurance companies.
During April-October, while LIC collected Rs 41,259 crore by writing new policies, the private insurers collected Rs 14,479 crore.
Considering the choppy equity market and the high inflation scenario, Ulip sales are unlikely to pick up this financial year and experts fear growth of the life insurance industry is likely to remain subdued over the next six to 12 months.