Star Health & Allied Insurance Co. Ltd. · NSE:STARHEALTH
Star Health & Allied Insurance — FY2023 Earnings Presentation
25 slides from Star Health & Allied Insurance's earnings presentation, Apr 28, 2023
Slide 1: Earnings Call Presentation Intimation Letter to Exchanges
Date: April 28, 2023 Place: Chennai Ref: SHAI/B & S/SE/20/2023-24 To, To, The Manager The Manager Listing Department Listing Department BSE Limited National Stock Exchange of India Limited Phiroze Jeejeebhoy Towers Exchange Plaza, 5th Floor, Plot C/1, Dalal Street G Block, Bandra-Kurla Complex Mumba
Slide 2: 4QFY23 & FY2023 Performance Review
4QFY23 & FY2023 PERFORMANCE REVIEW April 2023
Slide 3: Key pillars of our Strategy
Key pillars of our Strategy 34% Retail Health 39% Retail Health 1 Leadership in Retail Health Insurance Market Accretion Market Share Share 20% CAGR in no. of 2 Well Spread Distribution Network agents since FY20 to 0.63 million 835 Branches INR 8.9bn GWP 62% premium value 3 Investment in Technology
Slide 4: Key Performance Indicators (1/2)
Key Performance Indicators (1/2) Particulars Fiscal Year Ended March 31, (INR millions, unless otherwise stated) 2021 2022 2023 GWP 93,885.4 1,14,634.7 1,29,524.7 Period-on-period growth of GWP 36.8% 22.1% 13.0% Retail Health Renewal Premium Ratio 97.9% 94.0% 95.0% Number of agents (in '000s) 462.4
Slide 5: Key Performance Indicators (2/2)
Key Performance Indicators (2/2) Claims, Expense and Combined Ratio Profit After Tax (PAT) (INR billion) PAT Adjusted PAT 122.1% 117.9% 7.7 5.9 5.8 6.2 33.1% 21.3% 95.3% 0.4% 65.8% 64.6% 61.3% 27.7% 30.8% 30.3% FY21 FY22 FY23 -10.9 -10.4 Adjustment impact Expense Ratio FY21 FY22 FY23 Adjusted Claims
Slide 6: Agenda
Agenda Our Strategy Performance Update Industry Overview ESG: Strategy and Implementation Areas 5
Slide 7: Leadership in Attractive Retail Segment
1 Leadership in Attractive Retail Segment Retail Health Market Share Gross Written Premium (INR billion) 263 307 354 +17% 130 115 33% 34% 94 31% 119 101 82 FY21 FY22 FY23 Retail Health Industry Size in INR billion 1 10 2 12 2 8 Retail Health Accretion Market Share FY21 FY22 FY23 41% 43% 39% Retail G
Slide 8: Largest and Well Spread Distribution Network
2 Largest and Well Spread Distribution Network Total Agency Force Sponsored Health Agency Force In 000’s In 000’s 20.2% 32.2% 550 626 92 462 79 361 59 40 FY20 FY21 FY22 FY23 FY20 FY21 FY22 FY23 Channel wise mix and growth, FY23 FY23 82% 7% 5% 4% 2% Channel Mix 43% 17% 24% -17% -48% Corporate Individ
Slide 9: Extensive Footprint and Alternate Distribution Channels
2 Extensive Footprint and Alternate Distribution Channels Extensive Branch Network Partner Integration 737 807 835 FY21 FY22 FY23 Focus on SME & Banca Group Health Sales INR billion 71% SME 4.7 4.8 SME + Banca contribution Bancassurance 0.8 0.9 FY22 FY23 8
Slide 10: Continued focus on Digital Growth
3 Continued focus on Digital Growth Digital Acquisition Digital Issuance GWP acquired through online channels, INR ‘billion % of premium collection 7.2 8.9 28% Growth – Web-sales 56% 60% 62% 5.4 & Telesales FY21 FY22 FY23 FY21 FY22 FY23 Hyper-personalization 2.0m Digitizing Customer Customer App STA
Slide 11: Diversified and Specialized Product Suite
4 Diversified and Specialized Product Suite Specialized Products Star Cancer Care Policy Star Senior Citizens Red Carpet Health Insurance Policy Star Cardiac Care Policy Young Star Policy Star Diabetes Safe Policy ♀ Women Care Policy Retail Premium Mix for Specialized Products (%) New Product launch
Slide 12: Strong Domain Expertise Driving Superior Claims Ratio
5 Strong Domain Expertise Driving Superior Claims Ratio Net Incurred Claims Ratio(1) Increasing Sum Assured Fraud Analytics Growth of Average Sum Assured on Retail Health policies Disciplinary action against erring hospitals 94.4% 87.1% 23% 33.1% 21.3% 65.0% 0.4% 1,185 1,366 FY23 14% FY22 13% 10% 2.
Slide 13: Extensive Claims Processing and Network Negotiation
5 Extensive Claims Processing and Network Negotiation ANH(2) Share… Proportion of total cashless claims 9.0m Claims Settled Since Inception(1) 67% 64% 55% FY21 FY22 FY23 90% Cashless Largest Hospital network authorization< 2 hr 14.2kNetwork Valuable service provider (VSP) introduced to improve T
Slide 14: Agenda
Agenda Our Strategy Performance Update Industry Overview ESG: Strategy and Implementation Areas 13
Slide 15: Financial Performance
6 Financial Performance Combined Ratio Opex/GWP Ratio 122.1% 117.9% 33.1% 21.3% 95.3% 98.4% 91.3% 0.4% 4.2% 0.2% 61.3% 65.8% 64.6% 63.9% 61.8% 14.9 16.0 15.9 14.8 14.5 27.7% 30.8% 30.3% 30.3% 29.4% FY21 FY22 FY23 4QFY22 4QFY23 FY21 FY22 FY23 4QFY22 4QFY23 Adjustment Impact Expense Ratio Adjusted Cla
Slide 16: Robust Investment Performance
6 Robust Investment Performance Total Investments Assets Investment Income INR billion Investment Leverage INR billion +5% 2.4x 87% 2.4x 140 2.5 120 1.9x 2.0 100 80 1.5 7.9 8.3 60 134 +21% 114 1.0 40 4.2 68 0.5 20 1.8 2.2 0 0.0 FY21 FY22 FY23 Q4FY22 Q4FY23 FY21 FY22 FY23 Steady Returns... …with fixe
Slide 17: Agenda
Agenda Our Strategy Performance Update Industry Overview ESG: Strategy and Implementation Areas 16
Slide 18: India Health Insurance: Highly Underpenetrated and Growing
India Health Insurance: Highly Underpenetrated and Growing Global non-life premiums (2021) were USD3,860bn with Health contributing almost half (1) Commercial lines 24% 49% Health 27% Personal lines India Health Insurance(2) India Retail Health Insurance INR billion INR billion 18% 19% 897 307 354 7
Slide 19: Standalone Players Continuously Gaining Share
Standalone Players Continuously Gaining Share SAHIs leading Industry Growth Due to Focus on Retail Health CAGR between FY18-23 % Market Share of Retail Health Insurance 26% 23% 18% 12% 54% FY2023 Market Share SAHI Private Industry PSU • Single product focus to better cater customer requirements 40%
Slide 20: Agenda
Agenda Our Strategy Performance Update Industry Overview ESG: Strategy and Implementation Areas 19
Slide 21: ESG: Strategy and Implementation Areas
ESG: Strategy and Implementation Areas Health Insurance is a Social business protecting Health and Wealth of Customers Strategic Pillars of ESG Environment Social Governance Undertake initiatives to Consistent work in areas To operate the business contribute to creating a of Healthcare, in Transpare
Slide 22: ESG: Strategy and Implementation Areas
ESG: Strategy and Implementation Areas Environment Social Energy and Water Saving Offering free telemedicine services with over 8.5 lakhs consultations to date and over Rs.24 crore savings • LED lighting and energy efficient AC installations • 3/5 star rated appliances with regular maintenance Provi
Slide 23: ESG: Strategy and Implementation Areas
ESG: Strategy and Implementation Areas Governance Board Structure Data /Cyber Security 50% - Independent directors Enforcing leading practices and controls through effective Cyber 2 Women independent directors security Policy and Framework Evaluation framework for directors Risk Management Business
Slide 24: Thank You
THANK YOU Health Insurance The Health Insurance Specialist
Slide 25: Glossary
Glossary Particulars FY Financial Year GWP Gross Written Premium GEP Gross Earned Premium CAGR Cumulative Annual Growth Rate Y-o-Y Year-on-Year VQST Voluntary Quota Share Treaty URR Unexpired Risk Reserve ANH Agreed Network Hospitals PA Personal Accident SME Small and Medium Enterprises TAT Turn Aro
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