The life insurance industry posted a loss of Rs 4,878 crore in the financial year 2008-09, as against a loss of Rs 3,413 crore in 2007-08, according to data released by the Insurance Regulatory and Development Authority in its annual report.

Losses incurred by the industry were 43 per cent higher as compared to the earlier fiscal.

Industry watchers attributed the losses mainly to private sector life insurers, who were unable to translate higher expenditure into growth in fresh business premiums.

In 2008-09, the industry posted a negative growth of 7.16 per cent in fresh business premium.

While the largest life insurer, Life Insurance Corporation of India, was able to increase its profits, most of the private players continued to incur huge losses.

LIC's profit increased 13 per cent to Rs 957 crore in 2008-09, from Rs 845 crore in 2007-08.

Some pare their losses

Among the private players, companies like ICICI Prudential Life Insurance and Bajaj Allianz Life Insurance were able to pare their losses substantially as they tried to cut costs by going slow on expansion plans.

While ICICI Prudential incurred a loss of Rs 780 crore in 2008-09 (against a loss of Rs 1,395 crore in 2007-08), Bajaj Allainz's losses came down to Rs 71 crore (Rs 214 crore).

But other established players like HDFC Standard Life Insurance, Max New York Life Insurance, Reliance Life Insurance, Birla Sun Life Insurance, Tata AIG Life Insurance and Aviva Life Insurance recorded higher losses.

Kotak Mahindra Life Insurance, MetLife Insuarance, Shriram Life and Aegon Religare were the only private players to post profits.