Max Life PAT up 9% in Q1 FY15

Max Life Insurance further increased its market share to 12.3%, an increase of 74 bps amongst private life insurers

August 06, 2014 2:14 IST | India Infoline News Service
Max Life Insurance today announced it Quarterly Results for the period ended June 30th 2014. The company continued its profitable growth journey during the first quarter of the Financial Year 2014-15 and has outperformed the industry as well as the private life insurers to record New Business Premium of Rs. 468 crore, growth of 22% over the corresponding period last year.
Max Life Insurance further increased its market share to 12.3%, an increase of 74 bps amongst private life insurers and maintained its rank as the fourth largest private life insurer. The Gross Written Premium of the Company grew 10% to Rs.1458 crores. During the period Shareholder Profit after Tax grew 9% to Rs. 102 crore.
Max Life Insurance also performed well on other business parameters during Q1 FY 2014-15 as compared to corresponding period in the previous year:
Assets Under Management increased by 25% to Rs.26,697 crore as on June 2014
Sum Assured in-force (Individual and Group) at Rs.1,90,448 crore, recorded an increase of 7%
Solvency Ratio of 500%, more than 3 times the mandatory 150%, and solvency surplus at Rs. 2,523 Crore indicates the Company’s strong and stable financial position
Cost to Gross Premium ratio improved 90 bps to 30.7% (PY: 31.6%) and Opex to Gross Premium ratio was better 30 bps at 22.3 % (PY: 22.6%)
Max Life Insurance’s customer centric approach to business has contributed to this strong financial performance.
One of the lowest customer complaints incidence at 0.23 complaints per thousand policies
99.94% of all claims were settled within 10 days of receipt of all documents during Q1 FY 2015. The total amount paid out as claims in the period stood at Rs. 42.4 crore
Conservation ratio at 83.3%, continues to be one of the best in the industry
Rajesh Sud, CEO & Managing Director, Max Life Insurance said, " I am happy to share with you our performance for the Q1 (April – June 2014) of the financial year 2015. We have responded extremely well to the uncertain and challenging external environment and demonstrated superior all round performance and have been able to remain steady as the largest non bank promoted life insurance player in India. This has been made possible due to our continued focus on building a successful life insurance business to deliver the core value of long-term savings and protection in a Life Insurance contract.”
“We are confident of a sustained profitable growth for Max Life Insurance as we continue to differentiate in the market place basis our advice based sales, balanced product portfolio, diversified distribution and superior customer experience through superior claims and complaint management.” he further added.
The Gross Written Premium for the April – June 2014 increased by 10% to Rs.1,458 crore with a 22% increase in new business premium to Rs.468 crore and the renewal premium recording a growth of 5% to Rs.990 crore.
The company also outperformed the industry by growing 22% as compared to a 8% growth witnessed by the industry over the corresponding period last year, in Adjusted individual First Year Premium, which is the true indicator of new business success. The Company’s conservation ratio at 83.3%, is amongst the best in the industry and testimony to its commitment towards customers. 13th month persistency at 78 % is also amongst the best in the industry.
Cost Management
Over the past 4 years Max Life Insurance has focused on higher efficiency and productivity and reduction of wasteful expenditure. The cost minimisation focus is reflected in Cost to Gross Premium ratio improving 90 bps to 30.7% (PY: 31.6%) and Opex to Gross  Premium ratio was better 30 bps at 22.3 % (PY: 22.6%)
Profit After Tax (PAT)
During the Q1 FY 2014-15, Max Life Insurance, recorded a shareholders’ Net Profit After Tax   of Rs. 102 crore, compared to Rs. 94 crore in Q1 FY 2013 - 14.
This rise in shareholders’ profit was a result of continued revenue growth coupled with better productivity and cost efficiency. 
Solvency Ratio & Capital
The solvency ratio of the company stood at 500% as on 30th  June 2014 as compared to 485%  for March 31st, 2014. Max Life Insurance maintained more than 3 times solvency margin as compared to the margin of 150% mandated by IRDA.
Assets Under Management
The Company’s Assets under Management (AUM) of Rs. 26,697 crore recorded a growth of 25% over the corresponding period last year.
Max Life Insurance has taken several initiatives to enhance its focus on customer centricity.Service Promise and Claims Guarantee introduced in the financial year 2013 demonstrated continuous improvement. Max Life has now one of the lowest customer complaints incidence rate. The Company’s customer complaints incidence rate stands at 0.23 as on June 2014 and 99.98% of the customer complaints are resolved within the specified time of 14 days.
The Company is also tracking well on its promises of claims guarantee to its policyholders. ~100% of death claims received on policies more than 3 year old have been paid and 99.94% of all death claims were paid within 10 days of receipt of relevant documents.

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