SBI Life Insurance Co. Ltd. · NSE:SBILIFE
SBI Life Insurance — H1 FY2023 Earnings Presentation
40 slides from SBI Life Insurance's earnings presentation, October 2022
Slide 1: Performance Update – September 2022
Performance Update – September 2022
Slide 2: Agenda: Focus areas and initiatives
Performance Update Focus areas and initiatives AGENDA Industry overview Annexure 2
Slide 3: Resilient business model creating long term value
Resilient business model creating long term value 2.4 lacs 99.4% insurance personnel, focus Trained Human Technological individual applications on need based selling Capital Innovation submitted digitally 990 Diverse Distribution offices with strong Financial Strength 2.19 times distribution channel
Slide 4: Delivered strong performance
Delivered strong performance ` in billion Revenue Profitability ` 6.4 (+36% Y-o-Y) ` 130.9 (+27% Y-o-Y) ` 68.3 (+22% Y-o-Y) CAGR 3% CAGR 25% CAGR 15% ` Profit after Tax New Business Premium ` New Business APE ` 21.2 1.5 times ` 148.8 (+16% Y-o-Y) ` 60.5 (+21% Y-o-Y) Value of New Business CAGR 25% CA
Slide 5: Capturing growth in a rapidly changing environment
Capturing growth in a rapidly changing environment ` in billion 587.6 231.0 279.7 21% GWP 329.9 406.3 502.5 333.0 148.8 16% 296.3 128.1 240.4 192.0 89.6 46.3 21% 81.3 38.1 41.6 53.5 165.0 64.8 84.6 31% 96.4 112.4 125.0 FY 19 FY 20 FY 21 FY 22 H1 FY22 H1 FY23 New Business Premium1 Individual New Busi
Slide 6: Robust growth across all channels & segments
Robust growth across all channels & segments ` in billion Channel Mix NBP Individual NBP 165.9 206.2 254.6 102.9 130.9 112.4 125.0 165.0 64.8 84.6 4% 7% 8% 8% 9% 20% 27% 29% 30% 25% 29% 28% 27% 29% 24% 20% 18% 17% 18% 19% 67% 65% 65% 63% 67% 60% 56% 53% 52% 57% FY 20 FY 21 FY22 H1 FY22 H1 FY23 FY 20
Slide 7: Unparalleled distribution reach
Unparalleled distribution reach Bancassurance Institutional Alliance • 27,000+ SBI & RRB Bank Branches • 11,600+ Partner Branches • 127 Brokers • `40 Lacs SBI Productivity per branch1 • 58 Corporate Agents • 60% share in NOPs with 25% growth. • 6,800+ SPs • 54k+ CIFs • NPS augmentation ~4% growth •
Slide 8: Product portfolio
Product portfolio ` in billion Y-o-Y Mix Product Mix1 FY 20 FY 21 FY22 H1 FY22 H1 FY23 Growth (H1 FY23) Savings 98.4 105.7 137.8 54.2 64.0 18% 49% - Par 11.6 9.7 7.7 3.5 4.2 20% 3% - Non Par 6.3 10.5 17.0 5.3 16.9 221% 13% - ULIP 80.5 85.5 113.2 45.4 43.0 (5%) 33% Protection 20.8 24.6 30.5 12.1 16.0
Slide 9: Product portfolio
Product portfolio Care free Protection Financial Security Child Education Wealth Creation Retirement Average Age 37 37 36 38 57 Share in policies 28% 32% 7% 23% 10% The product list is only indicative & not exhaustive 9
Slide 10: Strong focus on customer service
Strong focus on customer service Persistency1 85.4% 85.2% 84.7% 85.2% 75.8% 78.1% 76.0% 77.5% 72.1% 72.1% 72.1% 72.9% 69.9% 67.5% 70.3% 65.6% 50.9% 49.5% 48.8% 52.5% 13th Month 25th Month 37th Month 49th Month 61st Month FY 21 FY 22 H1 FY22 H1 FY23 Customer satisfaction metrics Surrender Ratio2 Unfa
Slide 11: Cost efficiency, Profitability & Value
Cost efficiency, Profitability & Value ` in billion Opex Ratio : Maintaining Cost efficiency Profit after Tax : Consistent profit even after Covid Impact 15.7 Total Cost Ratio1 9.9% 8.3% 8.8% 9.5% 10.2% 15.1 15.2 100% 5.9% 5.8% 5.6% 14.6 5.1% 80% 14.7 6.4 4.8% 14.2 60% 14.2 4.7 40% 13.7 20% 0% 13.2
Slide 12: Value of New Business Movement
Value of New Business Movement ` in billion Value of New Business grew by 1.5 times VoNB margin growth of 630 bps from 24.7% to 31.0% $ VoNB Margin 21.8% 24.7% 0.0% 6.0% (0.7%) 1.0% 31.0% (0.5) 0.7 6.1 1.0 21.2 13.8 12.2 Opening VoNB as on Restated - Opening Impact of Business New Business Mix & Cha
Slide 13: Asset under Management
Asset under Management AuM – Linked | Non Linked Composition of Asset under Management 1,604 2,209 2,674 2,442 2,826 Equity 89:11 88:12 90:10 89:11 92:8 3% 3% 51% 47% 47% 47% 47% Government securities 29% 30% Fixed deposits ` 2,826bn 69:31 59:41 54:46 53:47 53:47 Debentures and bonds 49% 53% 53% 53%
Slide 14: Agenda: Focus areas and initiatives
Performance Update Focus areas and initiatives AGENDA Industry overview Annexure 14
Slide 15: Key Focus Areas
Key Focus Areas 990 offices (38% in rural & semi urban 7.5 lacs new customers opted for WhatsApp areas) & 40k branches of distributors registrations Widespread distribution network & product suite to cater different needs 33 individual & 7 group products to cater Hyper personalized communica
Slide 16: Key Initiatives – Q2 FY23
Key Initiatives – Q2 FY23 Retire Smart India Post Group Smart Care 2.0 CLIP Plus Payments Bank Workflow Improving Penetration Seamless customer journey Digitalising Customer Better Risk Management Customer needs Journey New Product Process Digitalising New Tie up New version Enhancement Processes 01
Slide 17: Digital Transformation
Digital Transformation Business Process – Simple and Intuitive Experience E-Submission E-Payment E-Verification E-Policy Supported by Seamless Customer Journey Simplified workflow Strong backend Automation with AI Data Analytics Real time updates processes assurance <10 43% 12% 99% 45mn mins Automat
Slide 18: Digital Transformation: Smart Care 2.0
Digital Transformation Smart Care 2.0 – Omnichannel Customer Experience and improved customer engagement 3.8mn+ My Policy Login Register Auto Proposal 250k+ Downloads Tracker Mandate 219k+ Total Registrations Products Premium Payment Online Revival Requirement Fund switch & submission
Slide 19: Digital Quotient
Digital Quotient Empowering Employees Empowering Distributors Empowering Customers 10.8 lacs+ proposals Online tool for learning 2.8mn+ reminders development of employees and Whatsapp - renewal distributors premium intimation Tablet based Digitization of sent application to sell policy proposal fill
Slide 20: Agenda: Industry overview
Performance Update Focus areas and initiatives AGENDA Industry overview Annexure 20
Slide 21: India Life Insurance - Structural Growth Drivers in Place
India Life Insurance - Structural Growth Drivers in Place Composition of Population1 Share of urban population2 Life Insurance DensityUS$3 5414 40.1% 34.9% 6.6% 8.6% 13.8% 30.9% 27.7% 49.3% 52.4% 54.2% 1971 18.0% 16.1% 13.6% 26.2% 23.0% 18.5% 246 69 253 48 2020 2030 2050 2000 2010 2020 2030 Singapor
Slide 22: Life Insurance – Significant Under Penetration versus other Markets
Life Insurance – Significant Under Penetration versus other Markets Underpenetrated Insurance Market Premium as % of GDP – 20211 Protection gap highest amongst peers2 Sum Assured as % of GDP3,4 7.5% 83% 332% 5.8% 76% 71% 70% 252% 251% 55% 55% 3.9% 3.2% 153% 143% 2.1% 127% 85% 1.1% Singapore South Ma
Slide 23: Protection – the next growth driver
Protection – the next growth driver Scope of Protection business Addressable Population1 Mortality Protection Gap (in US$ trillion)1 35.6 Population of India 1320 Mn Bank Accounts 26.8 1050 Mn PAN Card 440 Mn 16.5 Tax Return 59 Mn 8.5 MF Investor 5.5 21 Mn Insured 2009 2014 2019 2025e 2030e 6 Mn • L
Slide 24: Retirement solutions - Annuities
Retirement solutions - Annuities Scope of Annuities business Pension Assets/GDP ratio1 (2021) Ageing Population2 Life Expectancy at 603 213.3% 9% 19% 22 22 152.6% 20 19 18 17 62% 62% 72.2% 59.8% 29% 5.8% 19% Netherlands USA Japan Hongkong India 2015 2050 2000-05 2011-12 2030E Age < 15 yrs Age 15-59
Slide 25: Financialization of Savings
Financialization of Savings Increasing in Financial Savings Household Savings Composition1 Share of Life Insurance in Financial Savings1 7% 3% 3% 2% 6% 55% 26% 37% 37% 40% 27% 59% 60% 63% 59% 17% 17% 17% 16% 18% 18% 23% 19% 21% 17% 7% 45% 41% 40% 41% 10% 37% 11% 9% 13% 25% 16% 13% 14% 13% FY16 FY17
Slide 26: Industry Composition
Industry Composition Product portfolio1 Industry Private Players 13% 11% 10% 11% Higher ULIP contribution 13% 38% 34% 29% 29% 44% among private players, though traditional 87% 87% 89% 90% 89% products forms the major 62% 66% 71% 71% 56% share of new business FY 18 FY 19 FY 20 FY 21 FY 22 FY 18 FY 19
Slide 27: Agenda: Annexure
Performance Update Focus areas and initiatives AGENDA Industry overview Annexure 27
Slide 28: Annualised Premium Equivalent (APE)
Annualised Premium Equivalent (APE) ` in billion Y-o-Y Mix Segment FY 20 FY 21 FY 22 H1 FY 22 H1 FY 23 Growth (H1 FY 23) Individual Savings 93.0 94.6 118.7 46.0 55.3 20% 81% - Par 11.7 9.7 7.5 3.3 4.1 24% 6% - Non Par 6.5 10.7 17.1 5.3 17.5 228% 26% - ULIP 74.8 74.2 94.1 37.3 33.7 (10%) 49% Protecti
Slide 29: Individual Annualised Premium Equivalent (APE)
Individual Annualised Premium Equivalent (APE) ` in billion Y-o-Y Mix Channel Segment FY 20 FY 21 FY22 H1 FY 22 H1 FY23 Growth (H1 FY 23) Participating 4.6 2.8 1.9 0.9 1.6 82% 3% Non Participating 9.1 13.7 19.7 6.8 14.4 112% 23% Bancassurance Unit Linked 53.4 52.6 65.8 25.5 25.4 - 41% Total 67.1 69.
Slide 30: Sensitivity Analysis
Sensitivity Analysis Scenario Change in EV % Change in VoNB % Reference Rate +100 bps (4.1%) (0.7%) Reference Rate -100 bps 3.6% 0.5% Decrease in Equity Value 10% (1.6%) (0.2%) Proportionate change in lapse rate +10% (1.1%) (2.3%) Proportionate change in lapse rate -10% 1.4% 2.8% Mortality / Morbidi
Slide 31: Environment, Social & Governance: Environment
Environment, Social & Governance Environment Corporate office building is a Green Building; certified by Indian Green Building Council (IGBC) Energy Management to comply with efficient use of natural resources and minimal waste generation Water Incorporated rainwater Harvesting system. The water col
Slide 32: Social
Social Social Internal Stakeholders External Stakeholders Employees Employee wellness CSR Social Inclusion and people practices • Health check-up programme introduced at pan-India level • CSR policy and Corporate Social Responsibility Committee • Employee engagement survey with clear roles and respo
Slide 33: Governance
Governance Governance Board Structure Board Committees Board Governance • Five Independent Directors on • 8 committees (audit, • Diverse Board structure Board ensuring independence in investment, risk management, • Well defined roles, policyholder protection, responsibilities & accountability • gove
Slide 34: Customer Age and Policy Term
Customer Age and Policy Term1 Average customer age in years Average policy term in years Par 36 Par 14 Protection 37 Protection 13 ULIP 42 ULIP 12 Non Par - Others 39 Non Par - Others 27 Overall 39 Overall 16 34 1. Age and term for individual products for Sep 22.
Slide 35: Revenue and Profit & Loss A/c
Revenue and Profit & Loss A/c ` in billion Particulars FY 21 FY22 H1 FY22 H1 FY23 Premium earned 502.5 587.6 231.0 279.7 Premium on reinsurance ceded (4.9) (3.3) (1.2) (4.6) Net premium earned 497.7 584.3 229.7 275.1 Investment income1 323.4 245.2 187.2 50.2 Other income 0.4 0.5 0.3 0.2 Total income
Slide 36: Balance Sheet
Balance Sheet ` in billion Particulars FY 21 FY22 H1 FY23 SOURCES OF FUNDS Share Capital 10.0 10.0 10.0 Reserves and Surplus 90.9 104.2 110.8 Credit/(Debit) Fair Value Change Account 3.1 2.0 1.4 Sub-Total 104.0 116.2 122.2 Credit/(Debit) Fair Value Change Account 27.3 32.1 26.2 Policy Liabilities 92
Slide 37: Abbreviations
Abbreviations Term Description Term Description GWP Gross Written Premium Opex Operating Expenses (excluding commission) NBP New Business Premium CAGR Compounded Annual Growth Rate NOP Number of Policies GDP Gross Domestic Product APE Annualized Premium Equivalent INR (`) Indian Rupees IRP Individua
Slide 38: Glossary
Glossary New Business APE: The sum of annualized first year premiums on regular premium policies, and 10.00% of single premiums, written by the Company during the fiscal year from both retail and group customers. New Business Premium (NBP): Insurance premium that is due in the first policy year
Slide 39: Disclaimer
Disclaimer The information contained in this presentation is for information purposes only and does not constitute an offer or invitation to sell or purchase any securities of SBI Life Insurance Company Limited in India or in any other jurisdiction. This presentation is not intended to be a prospect
Slide 40: Thank you
Thank you Investor Relations Contact: SBI Life Insurance Co Ltd Fifth Floor, Natraj, M V Road & Western Expressway Highway , Andheri (E), Mumbai Dial - +91 22 6191 0281/ 0399 Email – investorrelations@sbilife.co.in Website – www.sbilife.co.in 40