Mumbai: HDFC Life Insurance Co Ltd’s profit net profit increased 4 per cent year on year to Rs 276 crore in the quarter ended December 2021 from Rs 267 crore a year ago led by strong growth in net premium income growth even as total benefits paid remained elevated.
Premium income net of reinsurance increased 28 per cent to Rs 12,124 crore from Rs 9487 crore a year ago, led by a 21 per cent growth in renewal premium to Rs 5543 crore in December 2021 from Rs 4577 crore a year ago.
CEO Vibha Padalkar said the signs are encouraging for the company with a 20 per cent growth in term plans and claims due to the Covid pandemic finally tapering off.
“Protection remains the growth engine for years ahead and the increase in sales of this is very encouraging. Also, the trends from Covid claims are very promising which makes us confident about the near future,” Padalkar said.
Total claims settled due to Covid in the third quarter of the fiscal fell to Rs 940 crore down from a peak of Rs 1510 crore in the second quarter which was the worse hit due to high mortality after the second wave of the pandemic. It was also lower than the Rs 956 crore the company settled in the first quarter.
Covid linked claims from individuals also fell sharply to Rs 77 crore in the third quarter from Rs 307 crore in the second quarter and Rs 155 crore in the first quarter.
“The trends are very encouraging and we are confident we will not need more provisions. Also, the global trend where the Omnicron wave has hit before us in South Africa, UK and US also shows that there is no major spike in mortality which makes us very confident,” Padalkar said.
The company holds Rs 105 crore of extra provisions to deal with any spike in claims after it put another Rs 55 crore during the quarter. It has used Rs 710 crore of these provisions so far this fiscal. Padalkar however said the company does not expect to make more provisions due to Covid.
The higher claims have however had an impact on the company’s solvency position reducing it wot 190 per cent from 202 per cent a year ago, though higher than the 150 per cent required by regulations.
The company also completed its acquisition of Exide Life effective from January 1 and Padalakar the company expects the benefits of the acquisition to come through in the next two years.
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