Author(s): Saswati Mohanty, Biplab Kumar Biswal and Sudhansu Sekhar Nanda
The purpose of this research is to assess the performance of the first ten private players in the Indian life insurance industry by using descriptive analysis combining factor and clustering analysis. The key performance indicators touched are Solvency Ratio, growth in premium, Claims settlement ratio, persistency ratio, and expense ratio. Inflow of relevant data was obtained from the records of IRDAI for the year 2023 and from annual reports of the corresponding companies. Exploratory factor analysis using the Principal Component Analysis (PCA) was used to act as a data reduction technique to identify performance dimensions; it was ascertained that two main factors which accounted for 75% of the variance of the variables captured the most significant performance factors. In the next step, the insurers were classified into three main strategic groups by averaging the scores on the factors. Thus, ranking was developed using composite scores and showed that HDFC Life, ICICI Prudential, and SBI Life are the key performers in the sense of the insurance industry. Data cleaning was done as per the study requirements and analysis was carried out using IBM SPSS (v26). The study reveals that the reliability of the transformed financial position is seen as the most important factor with service quality being the second factor that tilts the scale in terms of ranking. Consequently, it provides useful implications for stakeholders in improving orientational positioning and competitive advantage in the Indian insurance industry.