The company had made a provision ~Rs41cr as at March 31, 2020, for potential adverse mortality experience due to Covid. The provision held is in excess of the IRDAI prescribed norms. While this Covid reserve was not utilised in the previous quarter, we believe that it is prudent for us to continue to carry it forward.
HDFC Life has assessed its solvency position as at the quarter ended June 30, 2020. The company’s solvency position remains healthy at 190% compared to 184% as on March 31, 2020, and the regulatory requirement of 150%.
“As the economy is coming to terms with the effects of the pandemic, we are increasingly witnessing encouraging on‐ground trends. Business has started to pick up on a month‐on‐ month basis and we are seeing higher traction, especially in the individual protection business. As the situation begins to normalise, we expect life insurance to emerge as an important avenue for both protection as well as long term savings, and consequently help attract a higher quantum of inflows from Indian households.
Given our wide bouquet of product offerings across segments and continued focus on a balanced product mix, we believe that we are well positioned to serve the anticipated demand uptick,” the company said.
The company’s individual WRP market share increased by 100 basis points from 17.5% in Q1FY20 to 18.5% in Q1FY21. It de‐grew by 19% during Q1FY21 on a high base of 63% growth same quarter last year and delivered better than the private industry which de‐grew by 23% on a base of 24% growth same quarter last year. In the month of June, our de‐growth was 3% on a base of 87% growth in the same month last year, thereby showing improving business momentum.
The company’s digital footprint has allowed it to service our customers remotely. More than 75% of its branches are operational across the country.
HDFC Life Insurance Company Ltd is currently trading at Rs609, up by Rs1.65 or 0.27% from its previous closing of Rs607.35 on the BSE.