Vibha Padalkar, MD & CEO, HDFC Life Insurance
With a total premium of almost Rs 46,000 crore up 19 per cent y-o-y, over Rs 38,583 crore recorded in year-ago period, the life insurer’s asset under management (AUM) crossed Rs 2 trillion mark, clocking 17 per cent yoy growth in FY 2021-22.
“Further, we delivered a value of new business(VNB) for FY22 of Rs 2,675 crore, 22 per cent higher than FY21. Our VNB has grown at a 24% CAGR over the past 5 years and has almost tripled in the last five years,’’ said Vibha Padalkar, MD & CEO, HDFC Life Insurance
Mumbai:
HDFC Life, the third largest life insurer in the country, has posted a net profit of Rs 1208 crore,a decline of 11 per cent year-on-year( y-o-y ), in FY 2021-22, due to higher mortality reserve created during the year.
The life insurer’s board has recommended a dividend of Rs. 1.70 per share, translating to a payout of about 30 per cent of its net profit , in line with its dividend payout ratio of FY21 and earlier.
HDFC Life’s solvency as on March 31, 2022, stood at 176 per cent , post the cash payout of Rs. 726 cr. to Exide Industries, as part-consideration for the acquisition of Exide Life.
“In order to further strengthen solvency to fuel growth, we will continue evaluating raising capital through a mix of equity and debt,’’ said Vibha Padalkar, MD & CEO, HDFC Life Insurance.
The company’s board has recommended a final dividend of Rs 1.70 for FY22.
The company’s new business premium (individual and group) was at Rs 24,155 crore, up 20 per cent y-o-y, in FY 2021-22.
With a total premium of almost Rs 46,000 crore up 19 per cent y-o-y, over Rs 38,583 crore recorded in year-ago period, the life insurer’s asset under management (AUM) crossed Rs 2 trillion mark, clocking 17 per cent yoy growth in FY 2021-22.
HDFC Life’s embedded value, as on March 31, 2022, was Rs. 30,048 cr, up 13 per cent y-o-y , in FY2021-22.
Commenting on the FY22 performance, Padalkar said “We clocked a growth of 16 per cent in individual Weighted received premium (WRP) in FY22 with a market share of 14.8 per cent and 9.3 per cent in the private and overall sector respectively. Overall protection grew by 24 per cent in terms of Annualized Premium Equivalent (APE) and 47 per cent in terms of new business premium. This was largely led by a 55% growth in credit life new business premium, on the back of higher disbursements.”
WRP is the sum of first year premium received during the year and 10 per cent of single premiums including top-up premiums. APE is the sum of annualized first year regular premiums and 10 per cent weighted single premiums and single premium top-ups
On the retirement side, the life insurer’s annuity business recorded 24 per cent growth vis-à-vis industry growth of 3 per cent. Annuities now contribute over a fifth of HDFC Life’s new business premiums, with us almost doubling our business in the last 3 years, said Padilkar.
The life insurer’s gross and net claims were at Rs 5,804 crore and Rs 4,328 crore respectively for FY22. As on 31st March 2022, the company carries reserves of Rs 55 crore into FY23 as a prudent measure towards Covid.
HDFC Life’s new business margin(VNB) for FY22 was 27.4 per cent as compared to 26.1 per cent for FY21.
“Further, we delivered a value of new business for FY22 of Rs 2,675 crore, 22 per cent higher than FY21. Our VNB has grown at a 24% CAGR over the past 5 years and has almost tripled in the last five years,’’ added Padilkar.
HDFC Life covered 54 million lives in FY22, registering an increase of 36 per cent over FY21 and settled close to 3.9 lakh claims during FY22.
All channels of the life insuer continued to perform well, with bancassurance growing by 13 per cent this year and 21 per cent based on year CAGR. Proprietary distribution, which includes its agency, direct and online channels, grew by 18 per cent this year.Its agency channel grew by 26 per cent . The channel added more than 40,000 agents in FY22, which is the second highest amongst private players.
“Moreover, we are focusing on building a women financial consultant model which we believe would give us higher activation, retention and productivity,’’ said Padilkar.
Q4 performance
HDFC Life Insurance said its net profit rose by 12.44 per cent to Rs 357.52 crore in the January-March quarter of 2021-22 as compared with Rs 317.94 crore recorded in the corresponding period of the previous year. For the full year 2021-22, HDFC Life profit after tax declined by 11 per cent year-on-year to Rs 1,208 crore.