Private sector life insurer HDFC Life Insurance on Friday reported a 15.19% year-on-year growth in its standalone net profit to Rs 315.22 crore for the third quarter of the current fiscal, aided by an over 18% Y-o-Y increase in net premium income. The insurer’s net profit had stood at Rs 273.65 crore in the year-ago period.
Its net premium income rose 18.59% YoY to Rs 14,379.38 crore during the quarter under review, compared with Rs 12,124.36 crore in the same period previous year, according to a stock exchange filing.
First year premium during Q3FY23 grew 28.78% to Rs 2,724.87 crore, against Rs 2,115.97 crore for the corresponding period last fiscal, while renewal premium during the period increased 29.66% to Rs 7,187 crore.
The company said in the latest quarter, it grew by 17% in terms of individual WRP (weighted received premium), which was ahead of the industry growth. WRP is the sum of first year premium received during the year and 10% of single premiums, including top-up premiums.
The company’s individual APE (annualised premium equivalent) for the nine months ended December 31, 2022, rose 23.26% to Rs 6,874 crore, from Rs 5,577 crore for the same period a year ago. Total APE for the nine months stood at Rs 8,174 crore, posting a 21.83% Y-o-Y growth. APE is the sum of annualised first year regular premiums, 10% weighted single premiums and single premium top-ups.
New business margin for 9MFY23 was at 26.5%, the same for 9MFY22. Persistency ratio for 13th month also remained unchanged at 87%. The insurance company said current year numbers are on a merged basis, hence prior years are not comparable. Notably, on January 1, 2022, the company had acquired 100% stake of Exide Life Insurance Company.
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“We are happy to share that the post-merger integration and synergy realisation from the combined business is progressing as per plan. This has been demonstrated by achievement of margin neutrality during this period. The newly added distribution partners now have access to HDFC Life’s products and digital capabilities,” MD & CEO Vibha Padalkar said.
Commenting on the 9MFY23 performance, Padalkar said, “While globally, headwinds persist from an economic perspective, India appears to be relatively better positioned. Insurance as a sector continues to be a beneficiary of a relatively robust economy, stable savings trends and favourable regulatory regime. Against this backdrop, we continue to maintain a steady growth trajectory.”
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Despite intense competition, the company has consistently been ranked among the top three life insurers across individual and group businesses, the MD said, adding the company maintained market leadership in credit life by delivering a strong growth of 52%, across nearly 300 partnerships. “While growth in retail protection remained tepid on a YoY basis, we saw sequential growth of 13% in Q3. With a combination of data analytics, insights into customer profiles and calibrated risk retention, overall protection APE grew by over 20% in 9MFY23 and we expect individual protection to continue picking up in the coming quarters,” she said.
The solvency ratio stood at 209% for the nine months ended December 31, 2022, compared with 190% for the same period a year ago.
On Friday, the company’s scrip on the BSE closed 2.41% lower at Rs 590.55.