annual report 2009-10 - IRDA

that companies in the life sector take seven to tenyears to break-even.I.3.28 Out of the 23 life insurers in operations during2009-10, 8 companies have reported profits viz. LIC,ICICI Prudential, Kotak Mahindra, SBI, MetLife, BajajAllianz, Sahara India and Aegon Religare. LifeInsurance Corporation of India had reported net profitof `1,061 crore i.e., an increase of 10.80 per cent over`957 crore in 2008-09. ICICI Prudential reported anet profit of `258 crore after incurring losses for eightconsecutive years, after setting up operations. KotakMahindra had reported a profit of `69.22 crore for thesecond year in a row; it reported profit for the firsttime in 2008-09. SBI Life reported profit of `276 crore,as against a loss of `26.31 crore in 2008-09. SBI Lifereported net profits for three consecutive years priorto this from 2005-06 to 2007-08. MetLife has reporteda profit of `25.06 crore. The insurer has been reportingprofits continuously in the last three financial years.However, MetLife is carrying deficit in thePolicyholders’ Account from 2007-08 to 2009-10.Sahara India reported a profit of `36.15 crore asagainst a loss of `18.15 crore during 2008-09. SaharaIndia had reported profits for the first time in 2007-08.Aegon Religare reported profits for the second yearin the row from inception in 2008-09. The companyreported profit of `3.82 crore in 2009-10 (`4.08 crorein 2008-09). Aegon is, however, carrying deficit in thePolicyholders’ Account for 2008-09 and 2009-10. BajajAllianz has reported a profit of `542 crore in 2009-10.Shriram Life after reporting profits for four years in arow, registered a loss of `18.06 crore during2009-10, the first in its five year of operations(Statement No.20).I.3.29 The cumulative losses of the life insuranceindustry as at 31 st March, 2010 stood at `20,143 crore,as against `17,304 crore as at 31 st March, 2009.ANNUAL REPORT 2009-1020Returns to shareholdersI.3.30 For the year 2009-10, LIC has paid `1,031 croreas dividend to Government of India. This is97 per cent of its net profit earned during the year.LIC had paid the same per cent of its net profit asdividend during 2008-09 when it paid `929 crore asdividend to the ex-chequer.I.3.31 None of the private insurance companies paiddividends during 2009-10. This position is similar tothat in previous year 2008-09.TABLE 14DIVIDENDS PAID : LIFE INSURERS(` Crore)Insurer 2008-09 2009-10Public 929.12 1030.92Private — —Total 929.12 1030.92Expansion of officesTABLE 15NUMBER OF LIFE INSURANCE OFFICES*(as on 31 st March)I.3.32 During the year under review, there had beena move towards rationalisation of the offices of lifeinsurance companies in India. While LIC opened 220new offices, the number of offices of the privateinsurers decreased to 8,768 from 8,785 in 2008-09.Most private players resorted to restructuring to bringdown operating costs. Since opening up of the sectorin 2000, this is the first time that a negative growthhas been observed in the number of branch offices ofprivate sector life insurance companies. In 2008-09,the number of offices in the private sector hadincreased by 37.46 per cent.Insurer 2010 2009 2008 2007 2006Private 8768 8785 6391 3072 1645LIC 3250 3030 2522 2301 2220Total 12018 11815 8913 5373 3865* Offices opened after seeking approval of the AuthorityNote: 1) Data collected from life insurers through a special return.2) Office as defined under Section 64VC of the Insurance Act, 1938.