ICICI Prudential Life Q4 PAT slides 32% to Rs 178.73 cr

ICICI Prudential Life Insurance Company's consolidated net profit fell 31.52% to Rs 178.73 crore in Q4 March 2020 as against Rs 261.02 crore in Q4 March 2019.

Net premium earned rose 4.16% to Rs 10,475.12 crore in Q4 March 2020 from Rs 10,056.32 crore in Q4 March 2019. Profit before Tax (PBT) declined 38.49% to Rs 170.90 crore in Q4 March 2020 over Q4 March 2019.

Consolidated net profit fell 6.32% to Rs 1066.98 crore in the year ended March 2020 (FY20) as against Rs 1138.93 crore in the year ended March 2019 (FY19).

Net premium earned rose 7.52% to Rs 32,878.95 crore in FY20 from Rs 30,578.29 crore in FY19. Profit before Tax (PBT) declined 8.12% to Rs 1066.98 crore in FY20 over FY19.

Value of new business (VNB), used to measure profitability of the new business written in a period, rose 20.85% to Rs 1605 crore in FY20 over FY19. VNB margin was at 21.7% for FY20 compared with 17% for FY19. The increase in VNB margin is primarily on account of increase in protection mix.

Embedded Value at 31 March 2020 was Rs 23030 crore compared to Rs 21623 crore at 31 March 2019. The annualized premium equivalent (APE), a measure of new business written by a life insurance company, was at Rs 7381 crore for FY2020 as compared to Rs 7799 crore for FY2019.

The company offers a range of products across protection and savings solutions to meet the specific needs of customers. During FY2020, the protection APE recorded a growth of 54.6% rising to Rs 1116 crore as compared to Rs 722 crore in FY2019.

The company has strong focus on improving the quality of business and customer retention which is reflected in 13th month persistency ratios. Its 13th month persistency stands at 83.2% for 11M-FY2020. The 49th month persistency was 64.6% in 11M-FY2020 as compared to 63.8% in FY2019.

The cost to total weighted received premium (TWRP) ratio stood at 15.9% in FY20 compared to 15% in FY19. The cost to TWRP for the savings business stood at 10.4% in FY20 compared to 11.5% in FY19.

The total assets under management of the company stood at Rs 1,52,968 crore as on 31 March 2020. The company had a debt-equity mix of 60%:40% at 31 March 2020. 93.9% of the debt investments are in AAA rated and government bonds.

The company's net worth was Rs 7047 crore at 31 March 2020. The solvency ratio was 194.1% against regulatory requirement of 150%.

The company has assessed the impact of COVID-19 on its operations as well its financial statements, including but not limited to the areas of valuation of investment assets, valuation of policy liabilities and solvency, for the year ended on 31 March 2020. Further, there have been no material changes in the controls or processes followed in the financial statement closing process of the company. The company will continue to monitor any future changes to the business and financial statements due to COVID-19.

N S Kannan, MD & CEO, ICICI Prudential Life said, "As a nation, we continue to fight the COVID-19 pandemic. Through this period, we are proud that we have provided uninterrupted service to our customers through our extensive digital service capabilities. I would also like to thank our employees, who have been a key source of strength and have stayed focussed on serving our customers in these difficult times.

We had set our aspiration in April 2019 to double our FY2019 Value of New Business (VNB) within 4 years. I am happy to report that in FY2020, VNB grew by 21% from Rs 13.28 billion to Rs 16.05 billion for FY2020, which is well within the growth range required to meet that aspiration.

Our innovation journey continued during FY2020 with products such as Lakshya and Precious Life, as well as new-age distribution tieups with fin-tech companies and payment banks. On the regulatory front, within the sandbox framework, the IRDAI has approved seven proposals of life insurance companies. I am quite pleased to let you know that five of the seven proposals were ours. This is a further endorsement of our customer centric innovation initiatives."

ICICI Prudential Life is promoted by ICICI Bank and Prudential Corporation Holdings, headquartered in United Kingdom. The company offers and array of products in the Protection and Savings category which match the different life stage requirements of customers, enabling them to provide a financial safety net to their families as well as achieve their long term financial goals.

Shares of ICICI Prudential Life Insurance Company lost 6.84% to Rs 336.50 on Friday (24 April 2020).

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