SBI Life Insurance Company Limited has informed the Exchange regarding a press release dated July 25, 2023, titled "A copy of the press release and investor presentation being issued in connection wit...
July 25, 2023 SBIL/CS/NSE-BSE/2324/80
Assistant Vice President Listing Department, National Stock Exchange of India Limited, Exchange Plaza, Plot No. C/1, G Block, BKC, Bandra (East), Mumbai 400051 NSE Symbol: SBILIFE BSE Scrip Code: 540719
General Manager Listing Department, BSE Limited,
Mumbai 400001
Dalal Street,
Phiroze Jeejeebhoy Towers,
Dear Sir / Madam,
Subject: Press Release & Investor Presentation – Performance for the Quarter ended June 30, 2023
A copy of the press release and investor presentation being issued in connection with performance for the quarter ended June 30, 2023, is enclosed. The above information is also made available on the Company’s website at www.sbilife.co.in
We request you to kindly take the above information on record.
Thanking You,
Yours faithfully,
Vinod Koyande Company Secretary ACS No. 33696
Encl: A/a
SBI Life Insurance Company Ltd. Registered and Corporate Office: Natraj, M.V. Road and Western Express Highway Junction Andheri (East), Mumbai 400 069. Tel.: (022) 6191 0000/ 3968 0000 IRDAI Regn. No. 111. CIN: L99999MH2000PLC129113
www.sbilife.co.in
News Release BSE Code: 540719
July 25, 2023 NSE Code: SBILIFE
Performance for the quarter ended June 30, 2023
Private Market leadership in Ind. NBP of ` 40.6 billion with 18% growth and 26.8% market share
APE stands at ` 30.3 billion
17% growth in Protection APE to ` 3.7 billion
Value of New Business (VoNB) stands at ` 8.7 billion
VoNB Margin stands at 28.8%
45% growth in PAT to ` 3.8 billion
Robust solvency ratio of 2.15
57% growth in Annuity and Pension New Business to ` 18.3 billion.
Assets under Management stands at ` 3.3 trillion with 25% growth
Key measures of performance
Particulars Revenue Parameters New Business Premium (NBP) Renewal Premium (RP) Gross Written Premium (GWP) Individual New Business Premium Individual Rated Premium (IRP) Annualized Premium Equivalent (APE) Total Protection NBP (Individual + Group) Total Protection NBP Share Private Market Share based on IRP 1 APE Product mix (%) (Par/Non Par/ULIP) APE Channel mix (%) (Banca/Agency/others) Financial Parameters Profit after Tax (PAT) Net Worth Assets under Management (AuM) VoNB and VoNB Margin2 Value of New Business (VoNB) VoNB per Share (in ` ) (VoNB / Number of Shares) New Business Margin (VoNB Margin)
Key Financial Ratios Operating expense ratio 3
Q1 FY 2024 Q1 FY 2023
YoY
(` in billion)
62.1 73.5 135.6 40.6 26.7 30.3 7.8 12.6% 23.0% 7/40/53 65/25/10
3.8 135.3 3,282.8
8.7 8.72 28.8%
55.9 57.6 113.5 34.3 25.8 29.0 7.0 12.4% 24.0% 6/47/47 63/26/11
2.6 117.6 2,623.5
8.8 8.81 30.4%
11% 28% 19% 18% 3% 4% 12% - - - -
45% 15% 25%
(1%) - -
6.8%
6.6%
-
Particulars Commission ratio 4 Total cost ratio5 Persistency Ratios - Premium Basis (Regular Premium/ Limited Premium payment under individual category) 6
Q1 FY 2024 Q1 FY 2023 4.6% 11.2%
4.0% 10.8%
YoY
- -
13th month persistency 25th month persistency 37th month persistency 49th month persistency 61st month persistency
85.0% 76.1% 74.8% 70.4% 56.7% 2.15 11.5%
85.6% 78.7% 72.2% 70.3% 50.3% 2.21 9.0%
- - - - - - -
Solvency Ratio Return on Equity (RoE) 1. Source: Life insurance council 2. VoNB and VoNB Margin for Q1 FY24 and Q1 FY23 have been reviewed by Independent Actuary. 3. Operating expense ratio = Operating expenses / Gross Written Premium (GWP) 4. Commission ratio = Commission (including rewards) / Gross Written Premium (GWP) 5. Total cost ratio = (Operating expenses + Commission + Provision for doubtful debt and bad debt written off) /GWP 6. The persistency ratios are calculated as per IRDA/ACT/CIR/GEN/21/02/2010 circular dated February 11, 2010 and IRDAI circular
no. IRDAI/F&A/CIR/MISC/256/09/2021 dated September 30, 2021. Persistency Ratios for the period ended June 30, 2023 and June 30, 2022 are 'Upto the Quarter' Persistency calculated using policies issued in June to May period of the relevant years.
N.B: Refer the section on definitions, abbreviations and explanatory notes
The Board of Directors of SBI Life Insurance Company Limited approved and adopted its unaudited financial results for the quarter ended June 30, 2023, following its meeting on Tuesday, July 25, 2023 in Mumbai. The disclosure of financial results submitted to exchanges is annexed to this release.
Business growth and market share
The Company has maintained its leadership position in Individual Rated Premium of ` 26.7 billion with
23.0% private market share in Q1 FY 24.
Strong growth in Individual New Business Premium by 18% to ` 40.6 billion in Q1 FY 24.
New Business Premium (NBP) has grew by 11% to ` 62.1 billion in Q1 FY 24 aided by growth in Single
premium business by 18%.
Protection New Business Premium has increased by 12% from ` 7.0 billion in Q1 FY 23 to ` 7.8 billion in Q1 FY 24 due to growth in individual protection business by 5% to ` 2.1 billion and growth in group protection business by 15% to ` 5.7 billion in Q1 FY 24.
Gross Written Premium (GWP) has grew by 19% to ` 135.6 billion in Q1 FY 24 mainly due to 18% growth
in Single Premium (SP) and 28% growth in Renewal Premium (RP) in Q1 FY 24.
Distribution network
The Company has strong distribution network of 289,162 trained insurance professionals consisting of
agents, CIFs and SPs along with widespread operations with 996 offices across country.
The Company has diversified distribution network comprising of strong bancassurance channel, agency channel and others comprising of corporate agents, brokers, micro agents, common service centers, insurance marketing firms, web aggregators and direct business.
APE channel mix for Q1 FY 24 is bancassurance channel 65%, agency channel 25% & other channels 10%.
NBP of Agency channel has increased by 23% to ` 11.6 billion in Q1 FY 24 and NBP of Banca channel has
increased by 32% to ` 38.4 billion in Q1 FY 24 as compared to same period last year.
Cost Efficiency
Total Cost ratio for Q1 FY 24 is 10.8% vis-à-vis 11.2% for Q1 FY 23
Commission ratio for Q1 FY 24 is 4.0% vis-à-vis 4.6% for Q1 FY 23
Operating Expense ratio for Q1 FY 24 is 6.8% vis-à-vis 6.6% in Q1 FY 23
Profitability
Profit after Tax (PAT) grew by 45% to ` 3.8 billion for Q1 FY 24.
VoNB stands at ` 8.7 billion for Q1 FY 24.
VoNB margin stands at 28.8% in Q1 FY 24.
Persistency
Strong growth in 37th month and 61st month persistency (based on premium considering Regular Premium/
Limited Premium payment under individual category) in Q1 FY 24 by 262 bps and 645 bps respectively
due to our focus on improving the quality of business and customer retention.
13th month persistency (based on premium considering Single Premium and Fully Paid-up policies &
group business where persistency is measurable) is 88.6% in Q1 FY 24 vs 88.7% in Q1 FY 23.
Assets under Management
AuM grew by 25% from ` 2,623.5 billion as on June 30, 2022 to ` 3,282.8 billion as on June 30, 2023
with debt-equity mix of 69:31. Over 94% of the debt investments are in AAA and Sovereign instruments.
Financial position
The Company’s net worth increased by 15% from ` 117.6 billion as on June 30, 2022 to ` 135.3 billion
as on June 30, 2023.
Robust solvency ratio of 2.15 as on June 30, 2023 as against the regulatory requirement of 1.50 indicating
strong financial position of the Company.
Definitions, abbreviations and explanatory notes
New Business Premium (NBP): Insurance premium that is due in the first policy year of a life insurance
contract or a single lump sum payment from the policyholder.
Annualized Premium Equivalent (APE): The sum of annualized first year premiums on regular premium policies, and 10% of single premiums, written by the Company during the fiscal year from both retail and group customers.
Individual New Business Premium: Insurance premium that is due in the first policy year of an individual
life insurance contract.
Individual Rated Premium (IRP): New business premiums written by the Company under individual
products and weighted at the rate of 10% for single premiums.
Renewal Premium: Life insurance premiums falling due in the years subsequent to the first year of the
policy.
Value of New Business (VoNB): VoNB is the present value of expected future earnings from new policies written during a specified period and it reflects the additional value to shareholders expected to be generated through the activity of writing new policies during a specified period.
Value of New Business Margin / VoNB Margin: VoNB Margin is the ratio of VoNB to New Business Annualized Premium Equivalent for a specified period and is a measure of the expected profitability of new business.
Solvency Ratio: Solvency ratio means ratio of the amount of Available Solvency Margin to the amount of Required Solvency Margin as specified in form-KT-3 of IRDAI Actuarial Report and Abstracts for Life Insurance Business Regulations.
Net worth: Net worth represents the shareholders’ funds and is computed as sum of share capital and reserves including share premium, share application money and fair value change account net of debit balance in profit and loss account.
About SBI Life Insurance
SBI Life Insurance (‘SBI Life’ / ‘The Company’), one of the most trusted life insurance companies in India, was incorporated in October 2000 and is registered with the Insurance Regulatory and Development Authority of India (IRDAI) in March 2001.
Serving millions of families across India, SBI Life’s diverse range of products caters to individuals as well as group customers through Protection, Pension, Savings and Health solutions.
Driven by ‘Customer-First’ approach, SBI Life places great emphasis on maintaining world class operating efficiency and providing hassle-free claim settlement experience to its customers by following high ethical standards of service. Additionally, SBI Life is committed to enhance digital experiences for its customers, distributors and employees alike.
SBI Life strives to make insurance accessible to all, with its extensive presence across the country through its 996 offices, 22,015 employees, a large and productive network of about 222,822 agents, 68 corporate agents and 14 bancassurance partners with more than 39,000 partner branches, 133 brokers and other insurance marketing firms.
In addition to doing what’s right for the customers, the company is also committed to provide a healthy and flexible work environment for its employees to excel personally and professionally.
SBI Life strongly encourages a culture of giving back to the society and has made substantial contribution in the areas of child education, healthcare, disaster relief and environmental upgrade. In 2022-23, the Company touched over 1.1 lakh direct beneficiaries through various CSR interventions.
Listed on the Bombay Stock Exchange ('BSE') and the National Stock Exchange ('NSE'), the company has an authorized capital of ` 20.0 billion and a paid up capital of ` 10.0 billion. The AuM is ` 3,282.8 billion.
For more information, please visit our website-www.sbilife.co.in and connect with us on Facebook, Twitter, YouTube, Instagram, and Linkedin.
(Numbers & data mentioned above are for the period ended June 30, 2023)
Disclaimer
Except for the historical information contained herein, statements in this release which contain words or phrases such as 'will', ‘expected to’, etc., and similar expressions or variations of such expressions may constitute 'forward-looking statements'. These forward-looking statements involve a number of risks, uncertainties and other factors that could cause actual results, opportunities and growth potential to differ materially from those suggested by the forward-looking statements. These risks and uncertainties include, but are not limited to, the actual growth in demand for insurance and other financial products and services in the countries that we operate or where a material number of our customers reside, our ability to successfully implement our strategy, including our use of the Internet and other technology our exploration of merger and acquisition opportunities, our ability to integrate mergers or acquisitions into our operations and manage the risks associated with such acquisitions to achieve our strategic and financial objectives, our growth and expansion in domestic and overseas markets, technological changes, our ability to market new products, the outcome of any legal, tax or regulatory proceedings in India and in other jurisdictions we are or become a party to, the future impact of new accounting standards, our ability to implement our dividend policy, the impact of changes in insurance regulations and other regulatory changes in India and other jurisdictions on us. SBI Life Insurance Company Limited undertakes no obligation to update forward looking statements to reflect events or circumstances after the date thereof.
This release does not constitute an offer of securities.
For investor queries please call Sangramjit Sarangi at + 91 22 6191 0281 or email investorrelations@sbilife.co.in
For further press queries please call Santosh Setty at +91-22-6191 0034 / Minakshi Mishra at +91-22-6191 0140 or email santosh.setty@sbilife.co.in / minakshi.mishra@sbilife.co.in
(`1 billion (bn) = ` 100 crore; `1 trillion = ` 1 lakh crore)
Performance Update – June 2023
1
Performance Update
2
Focus areas and initiatives
3
Industry Overview
4
Annexure
2
1
Performance Update
2
Focus areas and initiatives
3
Industry Overview
4
Annexure
3
Resilient business model creating long term value
Trained Human Capital
Technological Innovation
Diverse Distribution
Financial Strength
2.9 lacs insurance personnel, focus on need based selling
996 offices with strong distribution channels
98.6%
individual applications submitted digitally
2.15 times Solvency ratio
Over 4.4mn new lives with Sum assured ~ ` 1,379bn
Customer Centricity
Text Sustainable Value Accretion
` 8.7bn value of new business generated
Driven by strong brand, solid governance and committed employees
Numbers as on June 2023
4
Business highlights for 1QFY24
` in billion
` 62.1
` 30.3
` 3.8
CAGR 24%
Growth +11%
CAGR 18%
`
Growth +4%
CAGR 1%
`
Growth +45%
New Business Premium
New Business APE
Profit after Tax
` 73.5
` 26.7
` 8.7
CAGR 22%
Growth +28%
CAGR 17%
`
Growth +3%
Renewal Premium
Individual Rated Premium
Value of New Business
` 135.6
` 21.0
28.8%
CAGR 23%
Growth +19%
CAGR 54%
Growth +56%
Gross Written Premium
Protection & Annuity Share
New Business Margin
CAGR numbers are calculated for a period of 5 years from Jun’18 to Jun’23. Numbers are rounded off to nearest one decimal
5
Continues to deliver on long term growth vision
GWP
502.5
587.6
673.2
113.5
135.6
19%
` in billion
296.3
81.3
125.0
FY 21
333.0
89.6
165.0
FY22
377.3
86.8
209.1
FY23
57.6
21.6
34.3
73.5
21.5
40.6
28%
18%
in million
Individual Policies
2.2
1.7
1.9
1%
0.4
0.4
Q1 FY23
Q1 FY24
FY 21
FY22
FY23
Q1 FY23
Q1 FY24
Individual New Business Premium1
Individual Policies1
Period
Period
Period
Period
Growth
SBIL Market Share
Growth
SBIL Market Share
Industry
Private
SBIL
Industry
Private
Industry
Private
SBIL
Industry
Private
Q1 FY21
(15%)
(18%)
(29%)
Q1 FY21
8.5%
17.6%
Q1 FY21
(35%)
(14%)
(36%)
Q1 FY21
6.1%
16.0%
Q1 FY24
3%
8%
3Yr CAGR
18%
26%
18%
45%
Q1 FY24
15.9%
26.8%
Q1 FY24
(8%)
4%
1%
Q1 FY24
8.7%
26.6%
Gain (in bps)
735
924
3Yr CAGR
16%
10%
30%
Gain (in bps)
262
1,065
1 Based on Life Insurance Council data; Components may not add up to total due to rounding-off.
6
Strong growth in Individual New Business aids to gain in Market share
Stable distribution mix and driving balanced product mix
Channel Mix
NBP
Individual NBP
` in billion
206.2
254.6
295.9
55.9
27%
17%
56%
29%
18%
53%
21%
19%
60%
31%
17%
52%
62.1
19%
19%
62%
125.0
7%
28%
165.0
8%
27%
209.1
10%
23%
34.3
9%
26%
40.6
13%
21%
65%
65%
67%
65%
66%
FY 21
FY22
FY23
Banca
Agency
Q1 FY23 Others
Segment Mix
NBP
Q1 FY24
FY 21
FY22
FY23
Banca
Agency
Individual NBP
Q1 FY23 Others
Q1 FY24
12%
42%
54%
5%
FY 21
12%
45%
52%
3%
FY22 Non-par
Par
12%
38%
59%
3%
FY23
12%
32%
65%
3%
13%
31%
65%
3%
Q1 FY23
Q1 FY24
6%
6%
5%
68%
69%
24% 8%
FY 21
27% 5%
FY22
53%
42%
5% FY23
6%
51%
5%
48%
43%
5% Q1 FY23
47%
5% Q1 FY24
ULIP
NBP - Protection share
Par
Non-par
ULIP
Ind NBP - Protection share
Components may not add up to total due to rounding-off
7
Unparalleled distribution reach
Bancassurance
Agency
Institutional Alliance
Direct & Corporates
Pillars of distribution network
• 27,000+ SBI & RRB Bank
Branches
• 2,22,000+ Agents – 38%
growth over last year
• 27% NBP share in Total
Industry2
• 26% NBP share in Private
market2
• `47 Lacs SBI Productivity per
branch1 with 58k+ CIFs
• 61% share in NOPs with 15%
growth & 1% growth in Protection business
• 99.0% business sourced
digitally
• `1.6 lacs Agent
Productivity1
• 32% share in NOPs
• 99.7% business sourced digitally with 1.5mn uploads on Smart advisor
•
•
•
•
•
•
13,300+ Partner Branches
133 Brokers
7,900+ Specialized Persons
101% growth NPS augmentation
1% growth in policies
68 Corporate Agents
• Top 3 in Industry in fund
business
• Call Centers -
Dedicated call center for website sales & servicing
• Multi linguistic website in 9 languages to make buying easy
• Lead Management
ecosystem – Assignment, Nurturing & Monitoring
1.Productivity per branch/agent is based on Individual NBP 2. Based on public disclosures for FY23 All growth/drop numbers are with respect to June FY24 over June FY23. Components may not add up to total due to rounding-off.
8
Product portfolio
` in billion
Product Mix1
Savings
- Par
- Non Par
- ULIP
Protection
- Individual
- Group
Annuity
Group Savings
Total NBP
FY 21
105.7
9.7
10.5
85.5
24.6
7.4
17.2
30.2
45.7
FY22
137.8
7.7
17.0
113.2
30.5
9.4
21.1
34.7
51.5
206.2
254.6
FY23
Q1 FY23
Q1 FY24
Y-o-Y Growth
Mix Q1 FY24
157.5
9.5
36.7
111.4
36.4
10.0
26.4
49.7
52.3
295.9
27.3
1.8
7.9
17.6
7.0
2.0
4.9
6.5
15.2
55.9
27.1 2.0 5.7 19.3 7.8 2.1 5.7 13.1 14.0 62.1
(1%)
13%
(27%)
10%
12%
5%
15%
103%
(8%)
11%
44%
3%
9%
31%
13%
3%
9%
21%
23%
Individual Savings
27.1
Protection
7.8
Annuity
13.1
12.8
2.1
Q1 FY19
Q1 FY24
Q1 FY19
Q1 FY24
Focus on balance product mix - long term value generation
0.4
Q1 FY19
Q1 FY24
1.New business premium basis; Components may not add up to total due to rounding-off
9
Wide product offerings
Protection
Financial Security
Child Education
Wealth Creation
Care free Retirement
Average Age
Share in policies
37
30%
36
27%
36
7%
38
26%
The product list is only indicative & not exhaustive
56
10%
10
Cost efficiency, Profitability & Value
Opex Ratio : Maintaining Cost efficiency
Profit after Tax : Consistent growth in profit
` in billion
Total Cost Ratio1
8.3%
8.8%
9.6%
11.2%
4.8%
5.1%
5.1%
6.6%
10.8%
6.8%
14.6
15.1
17.2
100%
80%
60%
40%
20%
0%
20.0
15.0
10.0
5.0
-
2.6
3.8
FY 21
FY22
FY23 Opex ratio
Q1 FY23
Q1 FY24
FY 21
FY22
FY23
Q1 FY23
Q1 FY24
Solvency : Cushioned to support future growth prospects
Networth : Zero debt company with healthy reserves
2.15
2.15
2.15
104.0
2.21
116.2
130.2
117.6
135.3
2.05
FY 21
FY22
FY23
Q1 FY23
Q1 FY24
FY 21
FY22
FY23
Q1 FY23
Q1 FY24
1. Total cost ratio is operating expenses including commission, provision for doubtful debts and bad debts written off divided by Gross Written Premium; Components may not add up to total due to rounding-off
11
Strong focus on customer service
85.2%
85.5%
85.6%
85.0%
78.1%
75.6%
78.7%
76.1%
72.1%
74.5%
72.2%
74.8%
69.9%
70.3%
70.3%
70.4%
Persistency1
49.5%
55.6%
50.3%
56.7%
13th Month
25th Month
37th Month
49th Month
61st Month
FY 22
FY23
Q1 FY23
Q1 FY24
Surrender Ratio2
Unfair Business Practice3
3.9%
4.6%
5.1%
3.9%
5.8%
0.06%
0.07%
0.08%
0.09%
0.04%
FY 21
FY22
FY23
Q1 FY23
Q1 FY24
FY 21
FY22
FY23
Q1 FY23
Q1 FY24
1. The persistency ratios are calculated as per IRDAI circular no. IRDAI/F&A/CIR/MISC/256/09/2021 dated September 30, 2021. Regular Premium & Limited Premium Paying Term policies of only Individual Segment.
Ratios for 12M are calculated using policies issued 1st June to 31st May period of the relevant years.
2. Surrender ratio-individual linked products (Surrender/Average AuM). 3. Number of grievances with respect to unfair business practice as compared to policies issued in the same period.
12
Value of New Business Movement
VoNB margin stands at 28.8%
` in billion
VoNB Margin
30.4%
-
0.4
(1.2%)
(0.4)
0.7%
0.2
(1.1%)
28.8%
(0.3)
8.8
8.7
Opening VoNB as on Q1 FY23
Impact of Business Volume
New Business Mix & Profile *
Change in Operating Assumptions
Change in Economic Assumptions #
Closing VoNB as on Q1 FY24
The methodology, assumptions and the results have been reviewed by Willis Towers Watson Actuarial Advisory LLP
*Impact of change mainly in Business mix and profile (Age, Term, Channel etc.); # Risk free rate change
13
Asset under Management
AuM – Linked | Non Linked
Composition of Asset under Management
2,209
2,674
3,073
2,623
3,283
` in billion
88:12
47%
90:10
47%
92:8
47%
92:8
48%
92:8
46%
59:41
53%
54:46
53%
52:48
53%
55:45
52%
49:51
54%
FY 21
FY 22
FY 23
Q1 FY23
Q1 FY24
Linked
Non - Linked
Debt:Equity
Investment performance1
12.4%
12.4%
12.8%
11.1%
11.3%
11.1%
11.3%
11.3%
11.4%
11.4%
Equity pension II
Equity Elite II
Equity Optimiser
Top 300
Growth
Fund
Benchmark
3%
2%
31%
` 3,283bn
30%
1%
Equity
Government securities
Fixed deposits
Debentures and bonds
Money market instruments
32%
Others
25%
~94%
(debt investments)
69:31
AUM Growth
AAA & Sovereign
Debt Equity Ratio
1. 5 year CAGR as on June; Components may not add up to total due to rounding-off.
14
1
Performance Update
2
Focus areas and initiatives
3
Industry Overview
4
Annexure
15
Key Focus Areas
❖ 996 offices (39% in rural & semi urban
areas) & 40k+ branches of distributors
❖ 34 individual & 9 group products to cater
different needs of the customer
❖ 4.2 lacs policies issued, growth of 1%
❖ 1.1 lacs individual protection policies sold
digitally
Leveraging Best in class operating ratios
❖ 96% Renewal Premium - collected through
Digital Mode
❖ Video MER – for enhanced convenience
❖ Real Time Integration - - with TPA for faster
transmission of medical reports
❖ One of the lowest cost ratios in the industry
❖ 18k+ Death Claims settled – ease to customers for document submissions
Widespread distribution network & product suite to cater different needs
services
❖ 2.2 mn customers served using WhatsApp
❖ TMT at home through Paddle TMT
❖ 268k+ Insta PIWC & 165k+ Audio PIWC
Disciplined Business Focus
Customer Engagement
❖ 0.3mn+ Queries resolved through call centre
❖ Customer Grievances – 8 per 10,000 policies.
Operational Efficiencies
Digital Capabilities
Harnessing technology in strengthening business
Use of analytics -enabling better customer engagement
❖ Focus on cutting edge technology for enabling
business
❖ RPA : 120 BOTs live with 450+ tasks having
processed 63.4 million transactions.
❖ Surrender Prevention tools for personalized
outputs
❖ Digital submission of Claims documents, e-
MHR.
❖ Account Aggregator - FIU & FIP
16
MER – Medical Examination Reports; OCR – Optical Character Recognition; COE – Certificate of Existence; MHR – Moral Hazard Report; PIWC – Pre Issuance Welcome Call
Digital Ecosystem
Ensure Data security
Deploy AI and Machine Learning
Talent Acquisition
Prospecting
22,015 Employees
289k+ Distributors
Enable Synergies
Talent Development
Customer at the core
On – Boarding & Issuance
Partner Integration
996 Offices
Policy servicing & Renewal
Optimize Technological Spend
MIS & Updates
Claims & Payouts
Customer On-Boarding process
<10 mins
Gen Ai
Reduction in Non medial Issuance TAT
29%
Digital KYC
67%
Ensure Reduction in TAT
Reduction in medial Issuance TAT
7%
Insta PIWC
61%
Automated underwriting
52%
E- IA
72%
Optimize usage of Data Analytics
0-2 Days Individual Issuance
78%
17
Accelerating Digital Transformation
Digital Ecosystem
❖ 914 varied product features built in PMS ❖ 21 Products in Group
policy system
❖ 40 functionalities to enhance customer experience
Flexible
Robust
❖ 40+ Digital Apps making journey seamless for all stakeholders
❖ 7 reporting and analytics tool with 3k+ reports ❖ Industry Best Bitsight
score of 800
Scaling digitally aided to support growth in NBP & Renewal with 0.4mn new policies & 52mn inforce lives
Scalable
Agile
❖ Partner integration YONO branch portal, SBI Caps, Yes Bank, IPPB, NPS – NSDL (API), Insurance Dekho, SIB, Indian Bank, KVB and many more
❖ 24*7 VDI / VPN
connectivity to enable WFH for all employees
❖ 136 active training
Modules in Eshiksha ❖ Digital onboarding of FLSM through apps.
People & Process Oriented
Guinness Record GPT tech based Passion Pledge on website
506k+ Short URL(bitly) business service generated
380 tasks
Robotic Process Automation
63k+ Cross-sell leads generated
25+ Self-servicing facilities for customers
1.1mn Queries handled through bots
PMS – Policy Management system (Ingenium), Indigo – Old PMS
70%+ Customer email enquiries handled by emai lBot
50k+
Queries handled by Call center/IVR
18
Accelerating Digital Transformation
616k+ Downloads
231k+ new lives with 291% premium growth
Smart Care
YONO
500k+ Downloads With 1.5mn+ document upload
Smart Advisor
85k+ Active Users With 0.5mn+ Proposal count
M-connect
59k+ Credit life Proposal logged in
1.4mn Queries resolved
32.3mn Members
243k+ Claims Settled
Parivartan
RPA BOT
Bancs
E-PRAVAH
97k+ Requests Handled
2.2mn Renewal Intimation & Receipts
96% Employees trained
512k Customers
E-sampark
Eshiksha Empowered
Paisa Genie
2.6mn Cases Inwarded
3.1mn CIBIL, e-Kyc, Aadhar Vault, Need Analysis
36.5mn Transactions
1.7mn Cases handled
NB Workflow
E- Service Requests
Apex Platform
Renova
19
1
2
3
4
Performance Update
Performance Update
Focus areas and initiatives
Industry Overview Performance Update
Annexure
20
India Life Insurance - Structural Growth Drivers in Place
Composition of Population1
India’s share of urban population2
Life Insurance DensityUS$3
6.6%
49.3%
18.0%
26.2%
2020
8.6%
52.4%
16.1%
23.0%
2030
13.8%
54.2%
13.6%
18.5%
2050
0-14yrs
15-24yrs
25-64yrs
65+yrs
52.8%
5414
46.4%
40.1%
34.9%
30.9%
2010
2020
2030
2040
2050
Singapore South Korea
Thailand
India
China
Indonesia
1971
246
69
253
48
Advantage India • Over the next decade, Swiss re forecast that premiums will grow by an annual average of 9% in real terms. •
India is one of the fastest growing insurance markets in the world. It is the 9th largest country globally in terms of life premium volume and is expected to be 5th largest by 2032.
• One of the highest young population nations with median age of 28 years • Rising share of urbanisation – Growth in urban population at 2.4% CAGR between FY 15 and FY 20
Combination of a high share of working population, rapid urbanization, rising affluence and focus on financial inclusion to propel the growth of
Indian life insurance sector
1. United Nations, Department of Economic and Social Affairs, World Population Prospects 2019 2. World Urban Prospects 2018 3. Swiss re sigma No.4/2022
21
Life Insurance – Significant Under Penetration versus other Markets
Premium as % of GDP – 20211
Protection gap highest amongst peers2
Sum Assured as % of GDP3,4
Underpenetrated Insurance Market
7.5%
5.8%
3.9%
3.2%
2.1%
1.1%
83%
76%
71%
70%
332%
55%
55%
252% 251%
153% 143%
127%
85%
Singapore
South Korea
Malaysia
India
China
Indonesia
India
Indonesia Thailand
China
South Korea
Singapore
Singapore
Japan
US
Malaysia Thailand S.Korea
India
•
•
•
10th largest in insurance market worldwide and 2nd largest in Emerging markets with $126,974mn in total premium business as on 2021.
Total premium grew at annual average of 7.5% between FY15– FY21 & is expected to grow at an average of 9% per annum.
India continues to be under penetrated as compared to countries like China, Thailand and Korea.
1. Swiss Re, sigma No 4/2022 2. Swiss Re, “Closing Asia’s Mortality Protection Gap 2020” 3. As of FY2020 (for USA & Japan as of FY2018) 4. McKinsey estimates
22
Protection – the next growth driver
Addressable Population1
Mortality Protection Gap (in US$ trillion)1
Scope of Protection business
Population of India 1320 Mn
Bank Accounts 1050 Mn
PAN Card 440 Mn
Tax Return 59 Mn
MF Investor 21 Mn
Insured 6 Mn
35.6
26.8
16.5
8.5
5.5
2009
2014
2019
2025e
2030e
•
•
•
Low penetration levels as compared to the addressable population.
Increase in disposable income coupled with pandemic-induced awareness of protection products will increase penetration level.
Swiss Re estimates protection gap to rise from US$ 16.5 trillion in 2019 to US$ 35.6 trillion in 2030.
1. Phillip Capital Report ‘Life Insurance’ 2020
23
Retirement solutions - Annuities
Pension Assets/GDP ratio1 (2021)
Ageing Population2
Life Expectancy at 603
Scope of Annuities business
213.3%
152.6%
72.2%
59.8%
5.8%
Netherlands
USA
Japan
Hongkong
India
9%
62%
29%
2015
19%
62%
19%
2050
Age < 15 yrs
Age 15-59 yrs
Age 60+ yrs
22
19
22
20
17
18
2000-05
2011-12
2030E
Male
Female
• With the advancement of medical science, life expectancy has improved rapidly over the last few decades and demand for pension based products will
increase with the rise in life expectancy.
•
•
Regulatory tailwinds like increase in commutation of pension corpus from 33.3% earlier to 60% will only benefit insurance sector.
NPS contributes a significant portion of the retirement corpus in India and they are on track for a period of consistent high growth over the next decade.
1. Global Pension Assets Study, 2022 2. UN World Population Report 3. Ministry of Statistics and Programme implementation, Crisil, PFRDA, Census of India
24
India’s Growth Prospects & Financialization of Savings
6.7%
5.0%
4.3%
Fastest growing G20 Economy3 Average annual real GDP growth
Increasing in Financial Savings
3.0%
2.6%
2.4%
2.0%
1.9%
1.8%
1.7%
India
Indonesia China
Saudi Arabia
Australia
Turkey
Canada Mexico
South Korea
South Africa
Household Savings Composition1
59%
60%
61%
59%
41%
40%
FY18
39%
FY19
41%
FY20
FY16
FY17
Financial savings
Physical Savings
Average annual real GDP growth of 6.7% in the 10 years to 2032.
47%
53%
FY21
55%
45%
•
•
•
Share of Life Insurance in Financial Savings1
7%
26%
17%
18%
7%
25%
3%
3%
37%
37%
17%
19%
10%
16%
16%
21%
11%
13%
2%
40%
18%
17%
9%
14%
6%
27%
17%
23%
13%
13%
F Y 1 8
F Y 1 9
F Y 2 0
F Y 2 1
F Y 2 2
Mutual Funds Bank Deposits Life Insurance Funds Provident & Pension Funds (Including PPF) Small Savings (Excluding PPF) Others
Household financial saving has improved to 7.6% of GNDI2 in 2019-20, after touching the low of 6.4% in 2018-19.
Financial savings of Indian households may more than double in next 5 years
1. Reserve Bank of India, Handbook of Statistics 2. GNDI – Gross National Disposable Income 3. Swiss Re Report
25
Industry Composition
Product portfolio1
Industry
13%
13%
11%
10%
11%
87%
87%
89%
90%
89%
Private Players
38%
34%
29%
29%
62%
66%
71%
71%
44%
56%
Higher ULIP contribution
among private players,
though traditional
products forms the major
share of new business
FY 18
FY 19
FY 20
FY 21
FY 22
FY 18
FY 19
Channel mix2
Traditional
ULIP
FY 20 Traditional
FY 21
FY 22
ULIP
9%
25%
11%
27%
Industry
12%
28%
13%
29%
13%
32%
15%
33%
66%
62%
60%
58%
55%
53%
Private Players
18%
20%
23%
22%
22%
24%
54%
54%
53%
55%
55%
53%
28%
26%
25%
23%
23%
23%
Banca channel continues
to be the largest
contributor for private
players although Direct
channel has gained
momentum in the past
years
FY 18
FY 19
FY 20
FY 21
FY 22
FY 23
FY 18
FY 19
FY 20
FY 21
FY 22
FY 23
Agency
Banca
Others
Agency
Banca
Others
1. New business premium basis 2. Individual new business premium basis Source: Life Insurance Council, Public disclosures Components may not add up to total due to rounding-off.
26
1
2
3
4
Performance Update
Performance Update
Focus areas and initiatives
Industry Overview Performance Update
Annexure
27
Annualised Premium Equivalent (APE)
Segment
FY 21
FY 23
Q1 FY 23
Q1 FY 24
Y-o-Y Growth
Mix (Q1 FY24)
` in billion
Individual Savings
- Par
- Non Par
- ULIP
Protection
- Individual
- Group
Annuity
Group Savings
APE
Channel
Bancassurance
Agency
Others
APE
94.6
9.7
10.7
74.2
12.0
7.3
4.7
3.0
4.9
FY 22
118.7
7.5
17.1
94.1
15.3
9.2
6.2
3.5
5.5
139.8
9.5
37.5
92.9
17.8
9.8
8.0
5.0
5.6
23.6
1.7
8.2
13.6
3.2
2.0
1.2
0.7
1.6
23.8
2.0
5.8
15.9
3.7
2.1
1.6
1.3
1.5
1%
14%
(29%)
17%
17%
6%
35%
103%
(7%)
4%
78%
7%
19%
53%
12%
7%
5%
4%
5%
114.5
143.0
168.1
29.0
30.3
FY 21
FY 22
FY 23
Q1 FY 23
Q1 FY 24
72.3
30.3
11.9
90.2
37.1
15.7
114.5
143.0
108.3
43.2
16.7
168.1
18.2
7.7
3.2
29.0
19.8
7.5
3.0
30.3
Y-o-Y Growth
Mix (Q1 FY24)
9%
(2%)
(5%)
4%
65%
25%
10%
100%
Components may not add up to total due to rounding-off
28
Individual Annualised Premium Equivalent (APE)
` in billion
Channel
Segment
FY 21
FY 22
FY 23
Q1 FY 23
Q1 FY 24
Y-o-Y Growth
Mix (Q1 FY24)
Participating
2.8
Non Participating
13.7
Bancassurance
Unit Linked
Total
Participating
Non Participating
Unit Linked
Total
Participating
Non Participating
Unit Linked
Total
52.6
69.1
5.9
3.7
20.6
30.2
1.0
1.8
1.0
3.8
Agency
Others
1.9
19.7
65.8
87.4
4.4
5.5
26.8
36.8
1.2
2.9
1.4
5.5
3.4
31.1
69.7
104.2
4.8
15.4
22.0
42.3
1.2
4.8
1.2
7.2
0.6
6.6
10.2
17.4
0.9
3.4
3.3
7.6
0.2
0.7
0.2
1.1
0.9
5.7
12.0
18.5
1.0
2.5
3.7
7.2
0.2
0.9
0.2
1.3
35%
(14%)
18%
6%
4%
(25%)
14%
(5%)
(4%)
19%
40%
18%
3%
21%
44%
68%
4%
9%
14%
27%
1%
3%
1%
5%
Components may not add up to total due to rounding-off
29
Sensitivity Analysis
Scenario
Reference Rate +100 bps
Reference Rate -100 bps
Decrease in Equity Value 10%
Proportionate change in lapse rate +10%
Proportionate change in lapse rate -10%
Mortality / Morbidity +10%
Mortality / Morbidity -10%
Maintenance Expense +10%
Maintenance Expense -10%
Mass Lapse for ULIPs in the year after the surrender penalty period of 25%(1)
Mass Lapse for ULIPs in the year after the surrender penalty period of 50% (1)
Tax Rate Change to 25% on Normal Tax basis
Change in VoNB %
(1.1%)
1.0%
(0.2%)
(2.7%)
3.4%
(5.3%)
5.4%
(1.9%)
1.9%
(5.7%)
(12.9%)
(8.9%)
1. Mass lapse sensitivity (of 25% or 50%) for ULIP business is applied at the end of surrender penalty period as defined by APS 10, which is taken to be the beginning of 5th policy year for current generation of our ULIP products
30
Environment, Social & Governance :
Energy Management
Water Management
Recycle & Reuse
Other Initiatives
• Corporate office building is a Green Building; certified by Indian Green Building Council (IGBC) to comply with efficient use of natural resources and minimal waste generation
• Over 1250 Virtual servers created on 80 Host Servers resulting in power saving
• Drinking Water of previous office day collected from Staff Water Bottles - re-used to water the garden plants. 500 litres of water per month re-used
• Incorporated Rainwater Harvesting system - usage for cooling towers of air conditioning
• 240 kgs per month paper waste generated (old newspapers) - used for making envelopes
• 1850 kgs of E-waste
recycled
• 250 kgs of Wet Food Waste per month - converted into compost by Eco Composter Machine installed in HO
• 99% new business proposals logged digitally
• 94% renewal premium collected digitally. Renewal premium intimations & receipts sent digitally
• Creation of dense forest of 19,000 native plants with Miyawaki Technic
The data pertains to FY 23
31
Environment, Social & Governance : Social
Employee wellness & people practices
Skill Development
Customer Centricity
Social Inclusion
• Work from Home policy
• Health check-up programmes & wellness sessions at pan-India level
• Employee engagement survey & Townhalls
• Performance appraisals & feedbacks. AIM (All ideas matter) for idea generation from employees
• Diversity and Inclusion ~ 19.04% women employees; increased by 41%
• Project Shakti to improve gender mix – 35% women advisors
• 136 modules created to enhance
knowledge and skills
• 94% CIFs & 92% Agents imparted training
• TISS LEAPVAULT CLO Awards 2022 - Best Induction Training Program
• 46 new e-learning courses launched. 49.3hr of learning in classrooms and 11.3hr of learning digitally.
• Training for smooth onboarding of sales and non sales employees – SAARTHI, UDAAN , SRIJAN.
• POSH Policy - Zero tolerance for sexual harassment
• Friday Pathshala – training on every Friday for all employees.
• Customer Surveys (Net Promoter Score - 59) & awareness programs
• CSR policy & Corporate Social Responsibility Committee with clear roles and responsibilities
• Grievances of customers reduced (15 per 10,000 policies)
• CSR activities covering healthcare, education & environment
• Website & customer communication in vernacular languages
• 110k+ CSR beneficiaries; 36+CSR partners. CSR spend in FY23 `226 Mn +
• ISO 10002-2018 Certification (On customer satisfaction management system)
• 700k+ policies issued in rural areas & 1.1mn lives covered in social sector
• Next-generation digital technologies like Artificial Intelligence (AI), Machine Learning, Data Analytics
• Insurance Awareness Campaigns
• Micro Insurance products & PMJJBY for financial inclusion
The data pertains to FY 23
32
Environment, Social & Governance :
Board Governance & Diversity
Risk Management & Business Continuity framework
Information Security framework
Code of Conduct & Regulatory framework
• >60% Independent Directors on Board ensuring independence in governance
• Women Director on Board
• 8 committees chaired by Independent Director
• Diverse Board structure
• Well defined roles, responsibilities & accountability
• Board Evaluation process & results – driven action plan
• Risk management practices aligned to ISO 31000:2018 standard covering all departments & functions at Corporate Office, Central Processing Centre, Regional & Branch Offices.
• Formulated risk appetite statements & carry out ICAAP (Internal Capital Adequacy Assessment)
• Business continuity practices are ISO 22301:2019 certified
• Internal & External Audit certified by ISO 22301:2012
• Aligned to ISO 27001 – ISMS
Sustenance
• Acceptable Usage practices, technical aspects of IS, Secure coding practices, secure configuration practices
• IS requirements for SBIL for outsourced vendors
• Robust Information & Cyber Security Policy to ensure data security & protects from cyber threats
• Firewall, anti-malware solutions, E-mail security & filtering in place
The data pertains to FY 23
• Well defined Code of Conduct &
Ethics for employees
• Governed by various policies like Anti money laundering & CFT, POSH, Insider Trading Policy, Whistle Blower, Sales quality, Fraud Prevention, protection of policyholders interest, to ensure best practices
• Operational processes certified by ISO 9001-2015
• Stewardship Policy – Engagement with investee companies; voting policy & Disclosures.
• 15% of AUM invested in infrastructure & housing
33
Customer Age and Policy Term1
Average customer age in years
Average policy term in years
Par
36
Par
19
Protection
37
Protection
13
ULIP
Non Par - Others
41
41
ULIP
13
Non Par - Others
30
Overall
39
Overall
17
1. Age and term for individual products for Jun 23.
34
Revenue and Profit & Loss A/c
Particulars
Premium earned
Premium on reinsurance ceded
Net premium earned
Investment income1
Other income
Total income (A)
Commission paid
Operating and other expenses2
Provision for tax – policyholders’
Claims/benefits paid (net)3
Change in actuarial liability4
Total expenses (B)
Profit before tax (A-B)
Provision for tax – shareholders’
Profit after tax
FY22
587.6
(3.3)
584.3
245.2
0.5
830.0
21.6
39.0
1.3
313.4
439.1
814.4
15.6
0.5
15.1
FY23
673.2
(7.3)
665.8
140.4
0.5
806.8
30.6
42.7
1.5
302.9
411.5
789.2
17.6
0.4
17.2
Q1 FY23
Q1 FY24
` in billion
113.5
(3.1)
110.4
(62.3)
0.1
48.2
5.3
9.2
0.3
51.7
(21.0)
45.5
2.7
0.0
2.6
135.6
(4.5)
131.0
147.9
0.1
279.0
5.4
11.1
0.4
71.0
187.1
275.1
3.9
0.1
3.8
1. Net of Provision for diminution in the value of investment and provision for standard and non-standard assets. Includes provision for doubtful debts (including write off) and service tax/GST on charges. 2. Inclusive of interim bonus and terminal bonus. 3. 4. Includes movement in fund for future appropriation. Components may not add up to total due to rounding-off.
35
Balance Sheet
SOURCES OF FUNDS
Share Capital
Reserves and Surplus
Particulars
Credit/(Debit) Fair Value Change Account
Sub-Total
Credit/(Debit) Fair Value Change Account
Policy Liabilities
Provision for Linked Liabilities (includes change in fair value)
Funds for Discontinued Policies
Funds for Future Appropriation
Total Liabilities
APPLICATION OF FUNDS
Investments
-Shareholders
-Policyholders
-Assets held to cover Linked Liabilities
Loans
Fixed assets
Net Current Assets
Total Assets
Components may not add up to total due to rounding-off
FY22
10.0
104.2
2.0
116.2
32.1
1,097.6
1,344.5
81.7
9.9
2,682.1
100.8
1,121.3
1,426.3
3.6
5.3
24.9
2,682.1
FY23
10.0
119.2
0.9
130.2
20.4
1,301.3
1,535.9
96.6
11.4
3,095.9
112.1
1,298.7
1,632.6
3.9
5.2
43.4
Q1 FY24
` in billion
10.0
123.1
2.3
135.4
30.2
1,358.3
1,656.3
104.6
13.3
3,297.9
126.8
1,365.0
1,760.8
4.1
5.3
36.0
3,095.9
3,297.9
36
Abbreviations
Term
Description
Term
Description
GWP
Gross Written Premium
Opex
Operating Expenses (excluding commission)
NBP
NOP
APE
IRP
AuM
New Business Premium
CAGR
Compounded Annual Growth Rate
Number of Policies
GDP
Gross Domestic Product
Annualized Premium Equivalent
INR (`)
Indian Rupees
Individual Rated Premium
USD ($)
United States’ Currency
Assets Under Management
TAT
Turn Around Time
Banca
Bancassurance
Unit Linked Insurance Plan
ULIP
PAR
Traditional Segment
Traditional Channel
Other than Unit Linked Insurance Plan
Bancassurance + Agency
Participating
VoNB
Value of New Business
NON PAR
Non-Participating
VoNB Margin
Value of New Business Margin
37
Glossary
⚫ New Business APE: The sum of annualized first year premiums on regular premium policies, and 10.00% of single premiums, written by the Company during the fiscal year
from both retail and group customers.
⚫ New Business Premium (NBP): Insurance premium that is due in the first policy year of a life insurance contract or a single lump sum payment from the policyholder.
⚫ Individual Rated Premium (IRP): New business premiums written by the Company under individual products and weighted at the rate of 10.00% for single premiums.
⚫ Renewal Premium: Life insurance premiums falling due in the years subsequent to the first year of the policy.
⚫ Gross Written Premium (GWP): The total premium written by the Company before deductions for reinsurance ceded.
⚫ Institutional Alliance: Business partners comprising of Corporate Agents, Brokers, IMF, CSC & POSP
⚫ Value of New Business (VoNB): Value of New Business is the present value of expected future earnings from new policies written during a specified period and it reflects the
additional value to shareholders expected to be generated through the activity of writing new policies during a specified period.
⚫ VoNB Margin: VoNB Margin is the ratio of VoNB to New Business Annualized Premium Equivalent for a specified period and is a measure of the expected profitability of new
business.
⚫ Solvency Ratio: Solvency ratio means ratio of the amount of Available Solvency Margin to the amount of Required Solvency Margin as specified in form-KT-3 of IRDAI
Actuarial Report and Abstracts for Life Insurance Business Regulations.
38
Disclaimer
The information contained in this presentation is for information purposes only and does not constitute an offer or invitation to sell or purchase any securities of SBI Life Insurance Company Limited in India or in any other jurisdiction. This presentation is not intended to be a prospectus or an offer document under any applicable law.
Except for the historical information contained herein, statements in this presentation which contain words or phrases such as 'will', 'would', ‘indicating’, ‘expected to’ etc., and similar expressions or variations of such expressions may constitute ‘forward-looking statements'. These forward-looking statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those suggested by the forward-looking statements. These risks and uncertainties include, but are not limited to our ability to successfully implement our strategy, our growth and expansion in business, the impact of any acquisitions, technological implementation and changes, the actual growth in demand for insurance products and services, investment income, cash flow projections, our exposure to market risks, policies and actions of regulatory authorities; impact of competition; experience with regard to mortality and morbidity trends, lapse rates and policy renewal rates; the impact of changes in capital, solvency or accounting standards, tax and other legislations and regulations in the jurisdictions as well as other. We undertake no obligation to update forward-looking statements to reflect events or circumstances after the date thereof. Past performance is not a reliable indication of future performance.
The assumptions, estimates and judgments used in the calculations are evaluated internally where applicable and have been externally reviewed. They represent the best estimate based on the company’s experience and knowledge of relevant facts and circumstances. While the management believes that such assumptions, estimates and judgments to be reasonable; the actual experience could differ from those assumed whereby the results may be materially different from those shown herein. The recipients of this presentation should carry their own due diligence in respect of the information contained in the presentation.
39
Thank you
Investor Relations Contact:
SBI Life Insurance Co Ltd Fifth Floor, Natraj, M V Road & Western Expressway Highway , Andheri (E), Mumbai Dial - +91 22 6191 0281/ 0399 Email – investorrelations@sbilife.co.in Website – www.sbilife.co.in
40