ICICI Prudential Life Insurance Company on Tuesday reported a 28.5% fall in its standalone net profit to Rs 301 crore for Q2FY19 on higher investments in growing protection business.
ICICI Prudential Life Insurance Company on Tuesday reported a 28.5% fall in its standalone net profit to Rs 301 crore for Q2FY19 on higher investments in growing protection business. Net profit stood at Rs 421 crore a year ago. Profit after tax (PAT) stood at Rs 583 crore against Rs 827 crore, a fall of 29.5%. Investment income stood at Rs 1,370 crore, a drop of 54% from the year earlier.
NS Kannan, MD & CEO, said, “Given the volatile market condition,85% of our incremental product sell is unit-linked insurance plans (Ulips) and it is a pass through to the customer.”
For decline in PAT, he said, “We have always talked about increase in the component of protection policies, we continue to invest in this business which makes immediate negative impact on P&L. We are making investment which will give benefits at the later date.”
Net premium earned (gross premium less reinsurance premium) rose by 14.8% from Rs 11,360 crore in H1FY18 to Rs 13,039 crore in H1FY19. Retail renewal premium increased by 23.1% from Rs 7,032 crore in to Rs 8,659 crore. Retail new business premium decreased by 5.6% from Rs 3,816 crore to Rs 3,603 crore. Group premium increased from Rs 636 crore to Rs 938 crore.
While value of new business (VNB) for H1FY19 was Rs 590 crore compared to Rs 417 crore for the half year ended September 30, 2017, a growth of 41.5%. The VNB margin increased from 16.5% in FY18 to 17.5% in H1FY19 primarily on account of an increase in protection mix.