ICICI Pru Life opts for a balanced portfolio approach

ICICI Prudential Life Insurance Company says it has transitioned to a balanced spread in its product portfolio, from being ULIP-centric three years back.

“We have transitioned from being an 82 per cent ULIP-dominated company in FY18 to having a balanced spread across products. For FY2021, our product mix was 48 per cent ULIP, 31 per cent non-linked, 16 per cent protection and 5 per cent group,” said its annual report.

Continued investment in product development has culminated in a wide range of customer-centric products across the protection, savings and pension segments that will serve needs of customers at every life stage, it added.

Non-linked products

During 9MFY2021, non-linked products contributed 82 per cent of the new business premium in the life insurance sector, primarily driven by LIC. The private sector further saw an increase in share of non-linked products to 63 per cent (56 per cent in FY20) of the new business premium, with linked products contributing the balance.

With a new business sum assured of ₹6.16-lakh crore in FY21, ICICI Prudential Life is now the private sector market leader. As on March 31, 2021, the company had an AUM of ₹2.14-lakh crore and total sum assured of ₹20-lakh crore.

“We are now one of the leading companies in terms of market capitalisation. We also raised subordinated debt capital of ₹1,200 crore in FY21, the largest by an insurance company in India, to support our next phase of growth,” NS Kannan, Managing Director & CEO of the company said in the report. He said the company’s claim settlement ratio was 97.9 per cent and turnaround time for claims settlement was 1.4 days, which are one of the best in the industry. In FY21, it had gross claims on account of Covid-19 at ₹459 crore. Net of reinsurance this claim amount was ₹ 264 crore.

Network strategy

The company also said that a robust distribution network strategy based on making life insurance accessible to a cross-section of customers has been one of the key drivers in increasing the company’s reach. The firm’s operational presence has expanded from just five cities in 2001 to 517 branches across the length and breadth of the country.

‘New business to double’

The company remains on track to double the FY19 value of new business by FY2023, which requires a compounded annual growth rate of 28 per cent over the next two years. The company aims to achieve this goal through its 4P strategy of premium growth, protection business growth, persistency improvement, and productivity enhancement..

With a diversified product mix in place and an enhanced distribution network with significant addition of new partners during the year, it expects to deliver higher premium growth, which will be a key part of its 4P strategy.

Source: The hindu business line