HDFC Life insurance company conducted a conference call on 13 October 2023 to discuss its financial reasons for the quarters ended September 2023. Vibha Padalkar MD&CEO of the company addressed the call:

Highlights:

The life insurance industry has demonstrated remarkable resilience, despite the recent budget changes that were perceived to be unfavourable for the sector.

The company has recorded a healthy growth of 10% in individual WRP against 8% for overall industry for H1FY2024. The market share was 15.7% in the private and 10.3% in overall sector.

The company has continued to grow faster than the overall industry and be ranked amongst the top 3 life insurers across individual and group businesses.

The company saw an uptick of 10% in the number of individual policies sold, beating industry growth.

This healthy volume growth is in line with our stated objective of broadening our customer base. The company has insured more than 3 crore lives across individual and group businesses, which represents a YoY growth of 16%.

More than two third of the customers on-boarded are new customers. And half of the new customers are below the age of 30 years.

Growth in the Tier 2 and 3 locations is double of the Tier 1 location growth.

Growth in protection was robust at 28% on new business premium basis. Retail protection registered YoY growth of 46% in H1FY24.

Sum assured recorded healthy growth, with retail and overall sum assured growing by 61% and 45% respectively.

The company has continued to lead in terms of sum assured and private market share based on overall sum assured stood at 18% for H1FY24.

Annuity APE grew by 17% and the segment contributed to 18% of new business premium. Annuity and Protection put together contributed to about 55% of new business premium in H1FY24.

The company has introduced 2 new products in the protection category - HDFC Life Sanchay Legacy and Click 2 Protect Elite.

HDFC Life Sanchay Legacy is an industry-first whole life, return of premium protection plan with increasing life cover and is designed to cater to a middle-aged and beyond customer segment.

Click 2 Protect Elite, caters to a more affluent customer category.

The company has witnessed an increase in the share of ULIP products to 28% of individual APE.

The VNB margins were steady for H1FY2024, which were impacted due to changes in the product mix and increased cost ratio.

HDFC Bank has exhibited significant traction in the wallet share rising to 62% during H1FY24 due to increased distribution strength of the bank and the introduction of new products in the HDFC Bank channel.

The company has partnered with Airtel Payments Bank with 1.5 million customers and added more than 37,0000 agents during H1FY24.

The company is confident about the medium to long-term growth opportunities, and expects to emerge strong.

The company expects flat VNB margins for FY24 similar to FY23. The company expects margins to improve in FY2025.

As per the company non-par product repricing is a continuous process and this year the company has repriced the products twice.

The company expects healthy growth in H2FY24 driven by the acquisition of more customers and growth in the policies sales.

The contribution of high ticket-sized policies of above Rs 5 lakh has declined to 6% in H1FY24 from 12% of APE in FY2023. The premium from sales of policies above Rs 5 lakh declined 20% and below Rs 5 lakh has increased 18%.

The company expects the recovery in the sales of policies above Rs 5 lakh in H2FY2024.