Ageas Federal Life Insurance records ten consecutive years of profit

4 May 2022 , 09:24 AM

Ageas Federal Life Insurance, one of India’s leading private life insurance companies, today announced its financial results for the 12-month period ending March 31, 2022, reporting a Net Profit of INR 94 crore. This is the 10^th consecutive year of profit for the private Life Insurer since it first declared profit in FY2012-13.

Despite facing various challenges due to the continuing pandemic, Ageas Federal’s total premium rose by 13% to INR 2,207 crore in FY 2021-22 from INR 1,959 crore in FY2020-21. The growth was driven by a 27% rise in Individual New Business Premium to INR 639 crore and 5% rise in renewal premium to INR 1,391 crore.

The Company also benefitted from a strong growth of 23% in Individual New Business Premium from Federal Bank.

An understanding of customers’ needs during the pandemic and catering to them with the appropriate products and solutions has helped Ageas Federal to improve its VNB margin by 9% to 22.39%. Our superior customer service and focus on developing long-lasting relationships with our customers has borne fruit with the 13^th month persistency reaching 79% and the Company being in the top quartile of all persistency buckets. 
 
The average turnaround time (TAT) in resolving complaints for FY 2021-22 was 2 days which is among the best in the life insurance industry and considerably lower than the industry average of 5 days. This was the eight consecutive financial year end where the pending complaints were nil at the end of the year.
 
With the surge in claims on account of COVID, our focus was on further digitalising the claims process to make the journey better and more efficient. Average TAT from date of intimation of the claim to date of settlement of the claim for individual death claims (including COVID-19 death claims) was 16 days. The claim settlement ratio for individual death claims in FY 2021-22 was 97.03% despite the challenges faced on account of the pandemic. The repudiation ratio for FY 2021-22 was 2.12% as against 2.16% in FY 2020-21 for individual death claims, while the repudiation ratio specifically for COVID-19 claims was 0.81%.

Commenting on the financial performance during the year, Mr. Vighnesh Shahane, MD & CEO, Ageas Federal Life Insurance said, “Despite the uncertain COVID situation during the first few months of the year, we recovered strongly to declare profit for the tenth consecutive year. On the distribution front, bancassurance continued to contribute in a big way to our growth numbers during the year. We also focused on growing our proprietary channels – agency, group, online, and DST in a smart, calibrated manner.

On the products front, we saw an increased demand for term plans as awareness has grown over the last couple of years. Also, with the falling interest rate regime and the uncertain global economic scenario, customers are showing greater interest in guaranteed plans. Interestingly because the stock markets have been buoyant over the last 18 months, we have also seen a lot of new in-flows and renewals of ULIP plans.

We aspire to become a truly digital organisation and our focus this year was on making our IT infrastructure more robust. We aimed to leverage the power of automation including next-generation digital technologies like Artificial Intelligence (AI), Machine Learning, and Data Analytics to transform our interactions with customers, employees, distribution partners, vendors and other stakeholders,” Mr. Shahane further added

Key Financial Summary		FY22		FY21		YoY %
	(Rs. In Cr)		(Rs. In Cr)
Total Premium		2207		1,959		13%
Individual New Business Premium		639		504		27%
Renewal Premium	1391	1,327	5%
Profit before Tax	104	135	-23%
Profit after Tax	94	119	-21%
Assets Under Management (AUM)	13,907	12,101	15%
VNB Margin (in %)	22.39%	20.60%	9%

Key Financial Ratios	FY22	FY21
Operating Expenses / Total Premium	12.50%	12.70%
Solvency Ratio	312%	340%
13M / 61M Persistency	13th Month — 79%	13th Month — 79%
(as of 31st Mar date on Regular Premium for the month of Feb)	61st Month — 42%	61st Month — 37%
Conservation Ratio	87%	86%
Business Mix (%) on Individual APE	ULIP: 44%	ULIP: 43%
(ULIP / Non PAR / PAR)	NON PAR: 42%	NON PAR: 43%
	PAR:  14%	PAR:  14%
Individual Distribution on NBP	CA               81%	CA               85%
(CA/Agency/Others)	Agency        6%	Agency        6%
	Others         13%	Others         9%