ICICI Prudential Life Q3 results: Net profit increases 43% to Rs 326 cr

India's ICICI Prudential Life Insurance reported a 43 per cent jump in third-quarter profit on Tuesday, driven by higher premiums from new policy sales.

The life insurer reported a standalone profit of Rs 326 crore (about $38 million) for the quarter ended Dec. 31, compared to Rs 227 crore a year ago. 

 

Its net premium income grew 23.5 per cent to Rs 1,226 crore, driven by a 78 per cent jump in single premiums or new policy sales.

Insurance awareness has been historically low in India, a country of more than 1.4 billion people, but the sector has seen rapid growth in recent years, particularly since the COVID-19 pandemic.

ICICI Prudential's larger peers HDFC Life Insurance and SBI Life Insurance reported strong third-quarter profits as well, on the back of strong retail insurance policy sales.

ICICI Prudential's value of new business (VNB), or expected profit from new policies, rose 8.5 per cent year-on-year to Rs 1,575 crore for the nine months to the end of December.

Annualised premium equivalent (APE) sales, the annualised total value of all single- and recurring-premium policies, jumped 27 per cent to Rs 5,430 crore for the nine-month period.

Insurers generally report cumulative data for metrics such as VNB and APE.

However, VNB margins slipped to 22.8 per cent from 26.7 per cent last year, due to a higher share of market- or unit-linked insurance plans (ULIP), which have a lower profit margin compared to term policies, the company said.

ULIPs accounted for 50.8 per cent of its overall product mix by APE, up from 43.1 per cent a year ago.