Buoyed by significantly lower claims and provisions due to Covid, private sector life insurer ICICI Prudential Life Insurance on Saturday reported a net profit of Rs 156.56 crore for the first quarter this fiscal. The insurer had incurred a loss of Rs 185.29 crore in the same quarter a year ago.
On a quarter-on-quarter basis, the net profit, however, fell 16.22% from Rs 186.88 crore for the fourth quarter of the last financial year.
The insurer’s net premium income registered a 4.28% year-on-year increase to Rs 6884.20 crore for the first quarter of FY23 from Rs 6,601.85 crore, while first year premium grew 17.98% y-o-y at Rs 1,038.51 crore as against Rs 880.26 crore, according to a stock exchange filing.
Renewal premium during the period under review, however, decreased by 5.88% y-o-y at Rs 3,894.06 crore. Annualised Premium Equivalent (APE) registered a 24.7% growth.
The company said for the quarter ended June 30, 2020, it has assessed the impact of Covid on its operations and financial statements. And based on this assessment, the company was carrying a provision for incurred but not reported claims (net of reinsurance) of `24.16 crore for Covid-19 as on June 30, which was included in the policy liabilities.
Value of New Business (VNB) for Q1FY23 was at Rs 471 crore as against Rs 358 crore for Q1FY22, registering a 31.6% y-o-y growth. VNB margin grew to 31% from 29.4%, primarily on account of shift in the underlying product mix.
Claims and benefit payouts (net of reinsurance) decreased to Rs 5,512 crore for the period under review from `5,668 crore for the year ago period.
N S Kannan, MD & CEO, ICICI Prudential Life Insurance, said the insurer’s efforts to reach out to the underserved customer segments and expansion in the distribution footprint had enabled it to maintain its position as the market leader on new business sum assured, which grew by 25% year-on-year in Q1FY23, taking the company’s market share to 15.8%.
“With a solvency ratio of 203.6%, which is well above the regulatory requirement, we are well positioned to capitalise on this opportunity,” Kannan said. With a moderating trend in Covid-19 related claims, he expected the country to be in the tail end of the pandemic. For the company, 13th month persistency ratio stood at 85.5% for Q1FY23 compared with 85% for Q1FY22.