ICICI Prudential Life Posts Strong VNB Growth for H1-FY2022

MUMBAI:
ICICI Prudential Life Insurance continued to register strong operating and financial performance with a robust growth in the Value of New Business (VNB) and New Business Premium for the half-year ended September 2021.

The Company’s Value of New Business (VNB), a measure of the profitability of a life insurance company, grew by 45% year-on-year to Rs. 8.73 billion for H1-FY2022. The New Business Premium, which highlights business expansion, grew by 45% to Rs. 64.61 billion for H1-FY2022 vis-à-vis the same period last year.

New Business Sum Assured grew 35% year-on-year to Rs. 3.37 trillion in H1-FY2022, enabling the Company to maintain its leadership amongst private sector life insurers with a market share of 13.2%.

The Annuity business segment witnessed strong growth of 95% year-on-year in H1- FY2022 to Rs.13.47 billion. The Company has a well-diversified product mix with linked savings at 48%, traditional savings at 30%, protection at 17% and the balance of 5% accounted for by group savings products.

The Company’s 13th month persistency ratio improved to 85.1% in H1-FY2022, up from 82.1% for the same period last year, indicative of the quality of business being underwritten.

The Company’s solvency ratio stood at 199.9% on September 30, 2021, well above the regulatory requirement of 150%. The Embedded Value stood at ` 302.03 billion at September 30, 2021, a growth of 17.5% over September 30, 2020. The Assets Under Management stood at Rs.2,370.87 billion at September 30, 2021, a growth of 31% over September 30, 2020.

N S Kannan, MD & CEO, ICICI Prudential Life Insurance said, “The improvement in the pandemic situation with each passing month, increased consumer awareness on the need for life insurance and our suite of customer-centric products have enabled us to grow new business by 62% sequentially this quarter. Significantly, we posted our best ever September on monthly sales for any year since inception, aided by our well-diversified product and distribution channel mix. Our New Business Sum Assured grew by 35% year-on-year to Rs.3.37 trillion in H1-FY2022 and we continued to be the private sector leader with an overall market share of 13.2%. As a result, our absolute VNB grew by 45% year-on-year to Rs.8.73 billion for H1-FY2022, demonstrating our progress towards achieving our stated objective of doubling our FY2019 VNB by FY2023.”

Mr. Kannan further added, “As a caring and responsible organisation we settled all genuine claims quickly to ensure customers and their families had the required financial support in their hour of need. I am also delighted to share that we have received two significant awards ‘Innovation during COVID-19’ and ‘Claims & Customer Service Excellence’ from the Federation of Indian Chambers of Commerce and Industry (FICCI), a testimony to our efforts around innovation and customer-centricity.”

Company Performance:
Value of New Business (VNB) growth
The VNB for H1-FY2022 grew by 45.0% year-on-year to Rs.8.73 billion. The VNB margin for H1-FY2022 stood at 27.3%, up from 25.1% for FY2021.

Progress on our 4P strategy
Premium Growth
New Business Premium grew by 45% year-on-year to Rs.64.61 billion in H1-FY2022. The Annuity business registered a strong growth of 95% year-on-year with ` 13.47 billion of New Business Received Premium in H1-FY2022. Traditional savings and linked savings APE grew by 42% and 45% year-on-year respectively in H1-FY2022.

Protection
Protection APE grew by 23% year-on-year to Rs.5.50 billion in H1-FY2022. The protection mix stood at 17.2% of APE in H1-FY2022. Focus on premium growth and expanding the protection business the New Business Sum Assured grew by 35% year-on-year to Rs.3.37 trillion in H1-FY2022 resulting in market share rising from 12.5% in H1-FY2021 to 13.2% in H1-FY2022, maintaining private sector market leadership.

Persistency
The persistency ratios have seen improvements in most cohorts, specifically in the 13th month which stood at 85.1% for H1-FY2022 as compared to 82.1% for the same period last year. The AUM grew by 31% year-on-year to Rs. 2,370.87 billion at September 30, 2021.

Productivity
The overall cost ratio i.e. Cost/Total Weighted Received Premium (TWRP) stood at 17.8% in H1-FY2022. The cost ratio for the savings line of business stood at 11.8% in H1-FY2022.

Embedded Value
The Embedded Value stood at Rs. 302.03 billion as on September 30, 2021 and grew by 17.5% over September 30, 2020.

Net worth and capital position
The Company’s net worth was Rs.87.55 billion at September 30, 2021. The solvency ratio was 199.9% against regulatory requirement of 150%.