In terms of Individual Rated New Business (IRNB) premium, the Company’s grew by 28% vs. industry growth of 3% and private industry growth of 8%. The Company maintained its rank of 6th for FY2021. In terms of new business premiums, the Company registered a new business growth of 22% for FY2021 vs. industry growth of 8% and private industry growth of
16 %. In terms of new business premium, the Company maintained it’s ranked at 5th position.
Individual Rated New Business
(₹ In Crore)
Group protection premium
(₹ In Crore)
With continued focus and various initiatives; renewal premium for the Company for FY2021 was ₹ 5,712 crore as compared to ₹ 4,574 crore for FY2021; growth of 25%.
(₹ In Crore)
Continued focus on renewal collections supported by various initiatives to improve persistency such as driving auto-payment registrations, promoting digital payments, greater distribution ownership and various other initiatives have led to 25% growth compared to previous year period.
Note: The persistency ratios for the year ended March 31, 2021 have been calculated for the policies issued in March to February period of the relevant years. e.g.: the 13th month persistency for the current year is calculated for the policies issued from March 2019 to February 2020
Though complaints has been increased by 20% from 1,572 in FY2020 to 1,887 in FY2021, the grievance ratio (grievances per 10,000 new policies issued) reduced from 50 in FY2020 to 44 in FY2021 (reduced by 12%).
Number of complaints
The Company earned a profit after tax of ₹ 580 crore during FY2021 as compared to the profit of ₹ 450 crore for FY2020.
The segmental performance for the Company is summarised below:
The new business value/margin, which is the net present value of future profits for the Shareholders’ from the new business generated during the year, is also reported by the Company annually. New business value/margin reflects the management’s view of the profitability of a product over its life measured at the point of sale. The gross new business value (unaudited and based on methodology prescribed under Actuarial Practice Standard 10 issued by the Actuarial Society of India) was ₹ 684 crore for FY2021 compared to ₹ 436 crore for FY2020, growth of 57%. The implied gross new business margin was 23% in FY2021 compared to 19% in FY2020. Post overruns, the Company’s net new business value was at ₹ 361 crore in FY2021 as against ₹ 227 crore for FY2020, growth of 59%.
The Company has also been disclosing the Market Consistent Embedded Value (MCEV) of the Company, which is a measure of the present value of Shareholders’ interests in the earnings distributable from the assets allocated to the business after sufficient allowance for the aggregate risks in the business. MCEV reflects the value of in-force business along with the Shareholders’ net-worth. MCEV is not a reflection of the market value of Company. MCEV computed in line with the Actuarial Practice Standard 10 issued by the Institute of Actuaries of India. The MCEV of the Company at FY2021 stood at ₹ 15,534 crore up from ₹ 13,438 crore at FY2020.
The Company remains well capitalized and maintained very high levels of solvency throughout the year. The solvency ratio as at Mar 31, 2021 stood at 666% (March 31, 2020: 745%) which is significantly in excess of the regulatory required limit of 150%.
AUM (₹ In Crore)
The AUM for the Company (including unclaimed funds) grew by 32% in FY2021 to end at ₹ 73,773 crore at Mar 31, 2021 increased from ₹ 56,085 crore at Mar 31, 2020.
The Company has in place adequate systems of internal control commensurate with its size and nature of business.
This Internal Control architecture has been summarized below:
Board oversees the internal control governance structure. Head of Departments (HOD) ensure control activities are performed at all levels within their functions, at various stages within business processes, and over the technology environment.
Observations of statutory, internal and concurrent auditors are presented before the audit committee for corrective and preventive actions. A pre audit committee is in place to go through, in great detail, each aspect impacting the control environment. The Audit Committee deliberates upon auditors’ views on the adequacy of internal control systems and monitors the progress of open items through action taken report. The risk management process identifies risks surrounding the Company’s activities. Risk management is integrated into the Company’s culture by way of an effective policy and a program led by the most senior management.
Departmental policies and procedures are an effective way to maintain a strong system of internal controls. All the departments have documented policies and procedures of critical processes in their respective functions and ensure operating level controls through clear delegation of authority and segregation of duties.
Further, financial reporting control framework reasonably assures that the Company’s financial statements are reliable and prepared in compliance with the accounting standards as prescribed in the Companies Act, 2013, in accordance with the provisions of the Insurance Act, 1938 and the practices prevailing in the insurance industry in India.
Investment operations are subject to daily concurrent audit certification and an Investment Risk Management Systems (IRMS) audit once in two years. Any significant findings in the concurrent audit or IRMS audit are presented to the Audit Committee. The financials prepared are audited by joint statutory auditors and are reviewed by Audit Committee. They are also submitted to Insurance Regulatory Development Authority of India (IRDAI). The Company has a Board approved fraud risk management policy.
The Board Audit Committee oversees the compliance framework of the Company. The Company has formulated various internal policies/ procedures and an employee code of conduct, which govern the day-today activities to ensure compliance. The compliance function disseminates the information regarding the relevant laws, regulations and circulars related to insurance and anti-money laundering to various functions. It also serves as a reference point for the staff of various functions for seeking clarifications on applicable laws, regulations and circulars issued by the regulatory authorities.
As required under the Companies Act 2013, Company has implemented Internal Financial Control (IFC) considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India.
Various other policies and committees support a robust internal control structure which include the Whistle Blower policy, Ethics Committee and Claims Review Committee.
For employee’s safety and perspective several measures continue in practice in Company premises since March 2020
For more details pertaining to risk, please refer Management Report Section 8 for “Overall risk exposure and strategy adopted to mitigate the same”.
As the future of work is being continuously redefined and Human Resources department in the Company continues to be positioned as a culture and change catalyst. The various roles as part of the culture and change anchor, the Company HR plays the role of a digital partner, talent driver and strategic advisor contributing to the overall business agenda.
Few of the key interventions are listed below: