ICICI Prudential Life posts net loss of Rs 185 crore
Private sector life insurer ICICI Prudential Life Insurance on Tuesday reported a net loss of Rs 185.29 crore on a consolidated basis in the first quarter of this fiscal year. He had posted a net profit of Rs 287.59 crore during the period last year.
Its profitability was affected as it had a total of Rs 1,119 crore claims for the first quarter due to Covid-19. The net reinsurance claims were Rs 500 crore.
The insurance company’s new business premium was Rs 2,559 crore for the first quarter of this fiscal year, up 70.6% from Rs 1,499 crore for the same period last fiscal year. The annualized premium equivalent (APE) was Rs 1,219 crore for Q1FY22, a growth of 48.1% from Rs 823 crore for Q1FY21.
The value of new business for the June quarter was Rs 358 crore, a significant growth of 78.1% over the same period last year. “With an APE of Rs 12.19 billion for T1-FY2022, the VNB margin was 29.4% for T1-FY2022 against 24.4% for T1-FY2021. The increase in the VNB margin is mainly due to a change in the underlying product line, ”said the insurer, promoted by ICICI Bank and Prudential Corporation Holdings.
“For the quarter ended June 30, 2021, the Company assessed the impact of Covid-19 on its operations as well as on its financial statements, including, but not limited to, the areas of investment asset valuations, valuation of policy liabilities and solvency. Based on the valuation, the company has a provision (net of reinsurance) of Rs 498.29 crore for Covid-19 claims as of June 30, 2021, which is included in policy liabilities, ”said ICICI Prudential Life in the scholarship file.
Notably, the solvency ratio fell to 193.7% as of June 30, 2021 against 205.1% as of June 30, 2020, while the persistence ratio in the 13th month (by premium) improved to 86% against 82, 9%.
Commenting on the results, NS Kannan, MD & CEO, ICICI Prudential Life Insurance, said: “In these difficult times, we remain sensitive to loss of life, health and livelihood issues and continue to prioritize safety of employees, customers and distributors. Life insurance has a greater societal role to play in enabling families to have financial security. In this context, our goal during this pandemic has been to help our customers’ families when they need it, by resolving real complaints quickly. “
Despite the challenges posed by the second wave of the pandemic, the company was able to demonstrate both resilience and growth in the first quarter, Kannan added.