Private life insurer HDFC Life Insurance saw a 40.1 percent year-on-year (YoY) fall in its consolidated net profit at Rs 269.55 crore. This was on the back of rise in reserves.
New business margins (NBM) during the quarter saw an improvement on a sequential as well as YoY basis on the back of growth and balanced product mix. The NBM for Q1FY22 stood at 26.2 percent, higher than 24.3 percent delivered in Q1 last year and 26.1 percent in full year FY21.
Vibha Padalkar, MD & CEO said, "Against the backdrop of disruption in business on account of localised lockdowns, and surge in cases during the second wave, we recorded 22 percent growth and market share of 17.8 percent in private sector in terms of individual weighted received premium."
In comparison to Q1 of last fiscal, HDFC Life clocked higher renewal collections, with 13th month persistency improving from 87 percent to 90 percent.
The Value of New Business stood at Rs 408 crore, a growth of 40 percent over last year.
The insurer said that "there was an excess mortality reserve of Rs 700 crore created at the balance sheet for potential adverse mortality. This reserve is over and above the policy level liabilities calculated based on the applicable IRDAI regulations." This was in addition of Rs 165 crore of the provisions.
The company's solvency position remained at at 203 percent in Q1 against statutory minimum requirement of 150 percent.
In Q1, HDFC Life saw a steep rise in death claims with peak claims in second wave at around 3-4 times of the peak claim volumes in the first wave.
"We paid over 70,000 claims in Q1. The gross and net claims provided for amounted to Rs 1,598 crore and Rs 956 crore respectively," he said.