Max Financial Services Limited
(MFS) today announced financial results for FY18. MFS, which manages a majority stake in Max Life Insurance, a private life insurance company, reported consolidated revenues of Rs14,967cr (excluding unit-linked investment income), growing 15% over the previous year. The company reported a consolidated net profit attributable to the owners of ~Rs296cr, which declined significantly by 25% yoy.
Max Life’s individual adjusted premium increased by 22% yoy to Rs3,215cr in FY18. This was primarily driven by improvement in productivity and increased demand for unit-linked products across channels. Max Life’s renewal premium stood at Rs8,152cr, up by 15% yoy. This was led by efficiency improvement
and various initiatives aimed at lapse recovery. Overall, gross written premium (GWP) in FY2018 was Rs12,501cr, up by 16% yoy.
Value of new business (VNB) written during FY18 is Rs656cr, significantly up by 31% yoy and the new business margin stood at 20.2%, which expanded by 140bps yoy in FY18. Max Life reported an embedded value (EV) of Rs7,509cr as on March 31, 2018, with an operating return on EV (RoEV) of 20.6% in FY18. AUM as at March 31, 2018 stood at Rs52,237cr, growing 18% over the previous year.
Claims and changes in policy reserves increased by 12% yoy to ~Rs13,160cr in FY18. The employee benefits expense reduced significantly by 15% yoy to Rs776.28cr. The other reported expenses increased by 14% yoy to Rs1,987.93cr in FY18.
The solvency ratio of Max Life stood at 2.75x as on March 31, 2018. Max Life is the fifth largest fund manager among private life insurers in India.