Star Health And Allied Insurance Company Limited has informed the Exchange about Investor Presentation
Ref: SHAI/B & S/SE/92/2023-24
To, The Manager Listing Department BSE Limited Phiroze Jeejeebhoy Towers Dalal Street Mumbai – 400001 Scrip Code: 543412
Dear Sir/ Madam,
Date: July 29, 2023 Place: Chennai
To, The Manager Listing Department National Stock Exchange of India Limited Exchange Plaza, 5th Floor, Plot C/1, G Block, Bandra-Kurla Complex Mumbai – 400051. Symbol: STARHEALTH
Sub: Revised Earnings Call Presentation – June 30, 2023
Further to our letter SHAI/B & S/SE/89/2023-24 dated July 28, 2023 regarding intimation of Q1- FY 2024 Earnings Call Presentation please find enclosed the revised presentation on performance of the Company, made to the Investors and Analysts on Friday, July 28, 2023 at 7.00 P.M. IST for the quarter ended on June 30, 2023.
The above information is also being hosted on the Company's website at www.starhealth.in
This is for your kind information.
For Star Health and Allied Insurance Company Limited,
Jayashree Sethuraman, Company Secretary & Compliance Officer
Encl.: As above
1QFY24 PERFORMANCE REVIEW
July 2023
Key pillars of our Strategy
1
2
3
4
5
6
Leadership in Retail Health
Well Spread Distribution Network
Investment in Technology
Diversified and Specialized Product Suite
Focus on Risk Management
Superior Operating Performance
32% Retail Health Insurance Market Share 16% CAGR in no. of agents since FY21 to 0.64 million
66% premium value issued digitally
33% Retail Health Accretion Market Share
856 Branches
INR 2.1bn GWP acquired from online channels
Specialized Products contribute 15.8% of Star Health’s total retail health GWP
15.1k Network Hospitals
Solvency Ratio at 2.18x (premium based)
61% claims processed through ANH
Best-in-class Opex/GWP Ratio of 18.3%
2
Key Performance Indicators (1/2)
Particulars
Fiscal Year Ended March 31,
Three Months Ended June 30,
(INR millions, unless otherwise stated)
2022
2023
2022
2023
GWP
Period-on-period growth of GWP
Retail Health Renewal Premium Ratio
Number of agents (in '000s)
Number of hospitals in network (in actual number)
Combined Ratio
Underwriting Profit/(Loss)
Investment Income
Investment Yield
Profit/(Loss) after tax
Net worth
Return on equity*
1,14,634.7
1,29,524.7
24,636.6
29,486.3
22.1%
94.0%
549.5
12,820
117.9%
(20,615.3)
7,928.2
8.2%
(10,406.7)
45,133.8
-26.0%
13.0%
95.0%
625.9
14,203
95.3%
2,046.2
8,345.6
6.9%
6,185.9
54,301.3
12.4%
12.7% 94.0%
566.5
13,426
98.2%
1,570.0
2,040.2
7.1%
2,132.4
47,348.5
4.6%
19.7% 96.0%
642.6
15,133
97.8%
1,454.3
2,499.8
7.4%
2,878.5
57,239.2
5.2%
Return on Equity = Profit After Tax/Average Net Worth. Note: Numbers are basis 1/365 URR method. ROE is non-annualised
3
Key Performance Indicators (2/2)
Claims, Expense and Combined Ratio
117.9%
21.3%
95.3% 0.4%
98.2% 0.7%
97.8% 0.0%
65.8%
64.6%
65.6%
65.4%
Profit After Tax (PAT) (INR billion)
7.7
5.8
6.2
PAT
Adjusted PAT
2.1
2.5
2.9
2.9
30.8%
30.3%
32.0%
32.4%
FY22
FY23
Q1FY23
Q1FY24
Adjustment impact
Adjusted Claims Ratio
Expense Ratio
-10.4
FY22
FY23
Q1FY23
Q1FY24
Note: Adjustments for FY22 and FY23 exclude COVID-19 claims impact, Non business ESOP cost.
Note: All numbers are basis 1/365 URR method
4
Agenda
Our Strategy
Performance Update
5
1
Leadership in Attractive Retail Segment
Retail Health Market Share
307
354
72
85
33%
34%
32%
32%
FY22
FY23
Q1FY23
Q1FY24
Retail Health Industry Size in INR billion
Gross Written Premium (INR billion)
+13%
115
101
130
119
2
12
2
8
FY22
Retail
FY23 Group
+20%
25
0
23 2 Q1FY23
PA
Travel
29
0
27 2 Q1FY24
6
2
Largest and Well Spread Distribution Network
Total Agency Force In 000’s
15.7%
Sponsored Health Agency Force
In 000’s
23.7%
462
550
626
643
59
79
92
95
FY21
FY22
FY23
Q1FY24
FY21
FY22
FY23
Q1FY24
Channel wise mix and growth, Q1FY24
Q1FY24 Channel Mix
81%
7%
5%
4%
2%
20%
Individual Agents
8%
Digital
35%
25%
29%
Corporate Agents - Banks, Others
Other Direct
Brokers
Note: Brokers excludes online brokers such as Policybazaar
7
2
Extensive Footprint and Alternate Distribution Channels
Extensive Branch Network
Partner Integration
807
835
807
856
FY22
FY23
Q1FY23
Q1FY24
Focus on SME & Banca Group Health Sales
INR billion
76%
SME + Banca contribution
SME
1.0
1.3
Bancassurance
0.2 Q1FY23
0.2 Q1FY24
8
3
Continued focus on Digital Growth
Digital Acquisition
GWP acquired through online channels, INR ‘billion
Digital Issuance
% of premium collection
8.9
7.2
2.0
2.1
60%
62%
66%
FY22
FY23
Q1FY23 Q1FY24
FY22
FY23
Q1FY24
26%
Growth – Fresh Digital (Q1FY24)
Digitizing Customer Acquisition
More than 80% of agents have downloaded the STAR ATOM app
Note: Digital includes web-sales, tele-sales, web aggregators and online brokers
9
4
Diversified and Specialized Product Suite
Specialized Products
Star Cancer Care Policy
Star Senior Citizens Red Carpet Health Insurance Policy
Star Cardiac Care Policy
Young Star Policy
Star Diabetes Safe Policy
♀
Women Care Policy
Retail Premium Mix for Specialized Products (%)
15.1%
15.5%
17.3%
15.8%
FY22
FY23
Q1FY23
Q1FY24
Note: Specialized products include disease and age specific products like Cancer care, Cardiac Care, Diabetes Safe, Senior Citizen Red Carpet, Women’s Care and Young Star
10
5
Strong Domain Expertise Driving Superior Claims Ratio
Net Incurred Claims Ratio(1)
Increasing Sum Assured
Fraud Analytics
Growth of Average Sum Assured in Retail Health policies
Impact on Claims outgo
87.1%
21.3%
65.0% 0.4%
65.4% 0.0%
65.8%
64.6%
65.4%
13%
10%
10%
10%
2.8%
1.9%
FY22
FY23
Q1FY24
FY23
Q1FY24
Q1FY23
Q1FY24
Adjustment impact
Adjusted Claims Ratio
New
Overall
Rejections (% of GEP)
Note: Adjustment for FY22 and FY23 exclude COVID-19 claims impact
(1) Net incurred claims ratio is defined as net incurred claims divided by net earned premium. All numbers are basis 1/365 URR method
11
5
Extensive Claims Processing and Network Negotiation
9.3m
Claims Settled Since Inception(1)
94%
Cashless authorization< 2 hr
ANH(2) Share…
Proportion of total cashless claims
64%
67%
56%
61%
FY22
FY23
Q1FY23
Q1FY24
15.1k
Network Hospitals
Largest Hospital network Valuable service provider (VSP)
introduced to improve TAT’s, Best pricing, transparency etc.
Note: (1) Data as of Jun 30, 2023 (2) ANH refers to Agreed Network Hospitals with better negotiated package based pricing. On number of claims count.
12
Agenda
Our Strategy
Performance Update
13
6
Financial Performance Combined Ratio
Opex/GWP Ratio
117.9%
21.3%
65.8%
30.8%
FY22
95.3% 0.4%
64.6%
30.3%
FY23
98.2% 0.7%
97.8% 0.0%
65.6%
65.4%
32.0%
32.4%
Q1FY23
Q1FY24
Adjustment Impact
Expense Ratio
16.0
15.9
17.3
18.3
FY22
FY23
Q1FY23
Q1FY24
Adjusted Claims Ratio Profit Before Tax (PBT)
(INR billion)
7.6
10.3
8.3
PBT
Adjusted PBT
Profit After Tax (PAT)
PAT
Adjusted PAT
2.9
3.4
3.8
3.8
(INR billion)
7.7
6.2
5.8
2.1
2.5
2.9
2.9
-14.0
FY22
FY23
Q1FY23
Q1FY24
-10.4
FY22
FY23
Q1FY23
Q1FY24
Note: Adjustments for FY22 and FY23 exclude COVID-19 claims impact, Non business ESOP cost. Note: All numbers are basis 1/365 URR method
14
6
Robust Investment Performance
Total Investments Assets
Investment Income
INR billion
2.4x
2.4x
Investment Leverage
INR billion
2.3x
2.2x
140 120 100 80 60 40 20 0
114
134
115
133
FY22
FY23
Q1FY23
Q1FY24
2.5
2.0
1.5
1.0
0.5
0.0
+5%
7.9
8.3
+23%
2.0
2.5
FY22
FY23
Q1FY23
Q1FY24
Steady Returns...
…with fixed income portfolio
8.2
6.9
7.1
7.4
FY22
FY23
Q1FY23
Q1FY24
75% AAA, Govt. Portfolio & FD
Long-Term Funds
Short-Term Funds
Government Securities, State Development Loans, Corporate Bonds, Fixed Deposits, REITs, InvITs and ETFs
Bank FDs, Overnight Mutual Funds, CPs, CDs, T-Bills, CMBs, Short Maturity Bonds and Tri-Party REPOs (TREPs)
15
THANK YOU
16
Glossary
Particulars
FY
GWP
GEP
CAGR
Y-o-Y
VQST
URR
ANH
PA
SME
TAT
Financial Year
Gross Written Premium
Gross Earned Premium
Cumulative Annual Growth Rate
Year-on-Year
Voluntary Quota Share Treaty
Unexpired Risk Reserve
Agreed Network Hospitals
Personal Accident
Small and Medium Enterprises
Turn Around Time
17