ICICI Prudential Life Insurance posted a net profit of ₹355 crore for H1FY23, an increase of 37 per cent YoY, owing to lower Covid-19 claims and provisions and strong new business growth.
However, profit after tax for Q2FY23 fell to ₹199 crore from ₹445 crore a year ago, largely on account of a 29 per cent jump in expenses to ₹1,221 crore.
Value of new business (VNB) grew 25 per cent YoY to ₹1,092 crore in H1FY23. The VNB margin expanded to 31 per cent from 27 per cent in the year-ago period largely on account of the shift in the underlying product mix, the company said in a release.
The new business premium for the insurer saw a growth of 14 per cent to ₹7,359 crore for H1FY23.
“This (performance) was driven by growth in APE (annualised premium equivalent) and margin expansion to industry-leading levels of 31 per cent. On the back of this strong VNB growth and with a favourable premium base for the coming months, we believe we are on track to achieve our objective of doubling our FY19 VNB by the end of FY23,” MD and CEO NS Kannan said.
Diversifying product mix
APE grew 10 per cent to ₹3,519 crore in H1FY23, led by a 69 per cent rise in the annuity business and a 30 per cent increase in the protection business. Savings APE was up 3 per cent at ₹2,576 crore.
Linked savings products account for 41 per cent of the product mix, traditional savings for 28 per cent, protection for 20 per cent, annuity for 7 per cent, and group saving products for 4 per cent as at the end of September.
ICICI Prudential Life said that, due to under-penetration of annuity and protection products in the country, these two segments offer significant growth opportunities. The company continued to maintain its leadership in the private insurance segment with a market share of 16 per cent.
“The diversification of product and distribution mix has enabled the company to manage the impact of external developments and respond to changing consumer preferences in an agile manner,” the release said.
The 13th-month persistency ratio, a measure of customer stickiness, improved by 80 bps to 86 per cent in H1FY23. Assets under management of the life insurer grew 3 per cent YoY to -2.4 lakh crore, with the solvency ratio at 200.7 per cent as of September 30.