Life Insurance Corp. Of India · NSE:LICI
Life Insurance Corp. Of India — Life Insurance Corporation of India — Q3 FY2024 Earnings Presentation
64 slides from Life Insurance Corp. Of India's earnings presentation, Feb 8, 2024
Slide 1: Stock exchange cover letter for analyst call presentation
Ref. No.: LIC/SE/2023-24/183 Date: February 08, 2024 To, The Manager The Manager Listing Department, Listing Department, BSE Limited, The National Stock Exchange of India Ltd., th Phiroze Jeejeebhoy Tower, Exchange Plaza, 5 Floor, Plot C/1, Dalal Street, G Block, Bandra Kurla Complex, Mumbai-400001
Slide 2: Investor Presentation Q3FY2024
2/8/2024 INVESTOR PRESENTATION Q3FY2024 February 8, 2024
Slide 3: Agenda
2/8/2024 Agenda 1 – INTRODUCTION TO LIC 2 – BUSINESS AND FINANCIAL UPDATES 3 – ACTUARIAL UPDATES 4 – MARKETING AND DISTRIBUTION STRENGTHS 5 – ACHIEVING OPERATIONAL EFFICIENCIES 6 – KEY FOCUS AREAS APPENDIX
Slide 4: Introduction to LIC
2/8/2024 1 INTRODUCTION TO LIC
Slide 5: Largest life insurer in India – clear market leader
2/8/2024 Largest life insurer in India – clear market leader Top public sector company in India by Market Capitalisation.1 Ranks 107th in the Fortune Global 500 list 2023. Ranked as the world’s 23rd Strongest Brand Globally in 2024.² Ranks 3rd in the Fortune India 500 list 2023. Life Insurance Corpo
Slide 6: Cross cyclical and comprehensive life insurance solutions
2/8/2024 Cross cyclical and comprehensive life insurance solutions Comprehensive Product Portfolio 16 Participating products 22 Non Participating Products (Including three Annuity Products) 11 Group products (incl. one credit life and one annuity product)¹ 8 Riders LIC’s Group Post-Retirement Medica
Slide 7: New products launched during 9MFY2024
2/8/2024 New products launched during 9MFY2024 LIC’s Group Name of LIC’s Dhan Vriddhi LIC’s Jeevan LIC’s Jeevan Post-Retirement Products Plan Kiran Plan Utsav Plan Medical Benefit Plan Introduction date 02.05.2023 23.06.2023 27.07.2023 29.11.2023 Par/Non Par Non-Par Non-Par Non-Par Non-Par Product S
Slide 8: Our products designed to suit customer life cycle
2/8/2024 Our products designed to suit customer life cycle Participating Products Non-participating Products Source: Corporation data, Product list indicative and not exhaustive. 7
Slide 9: Business and Financial Updates
2/8/2024 BUSINESS AND 2 FINANCIAL UPDATES
Slide 10: Business performance parameters
2/8/2024 Business performance parameters Amount INR Crore 9M-FY24 INR 3,22,776 Cr 9M-FY24 INR 1,13,057 Cr Total Group Business Total Premium Income -5.69% -20.28% Premium 9M-FY23 INR 3,42,244 Cr 9M-FY23 INR 1,41,815 Cr 9M-FY24 INR 38,679 Cr 9M-FY24 58.90% Individual New Business Market Share in -6.4
Slide 11: Business performance parameters
2/8/2024 Business performance parameters Amount INR Crore 9M-FY24 INR 23,194 Cr 9M-FY24 INR 3,93,384 Cr Weighted Received Total New Business Sum Premium - 0.26% - 7.92% 9M-FY23 INR 23,255 Cr Assured 9M-FY23 INR 4,27,211 Cr 9M-FY24 5,98,170 9M-FY24 16,288 Cr Total Number of Death Claims (Individual)
Slide 12: Financial performance parameters
2/8/2024 Financial performance parameters Amount INR Crore 9M-FY24 INR 26,913 Cr 9M-FY24 98.46% Claim Settlement Ratio +1.03% Profit After Tax¹ +17.16% Death² 9M-FY23 INR 22,970 Cr 9M-FY23 97.43% (Absolute) 9M-FY24 1.93 9M-FY24 1,25,56,046 +0.08 Number of Policies sold -2.60% Solvency 9M-FY23 1.85 (
Slide 13: Performance ratios
2/8/2024 Performance ratios 9M-FY24 9.14% + 0.56% 9M-FY24 7.90% Yield on Investment Yield on Investment + 2.74% (Policyholders Fund)² 9M-FY23 8.58% (Absolute) (Shareholders Fund)² 9M-FY23 5.16% (Absolute) 9M-FY24 2.15% 9M-FY24 91.10% - 2.87% - 1.48% Total Gross NPA Ratio¹ Conservation Ratio 9M-FY23
Slide 14: Actuarial Updates
2/8/2024 3 ACTUARIAL UPDATES
Slide 15: Indian Embedded Value (IEV)
2/8/2024 Indian Embedded Value (IEV) Embedded Value (INR Crore) 6,62,605 5,82,243 5,39,686 5,41,492 5,44,291 30th Sept 21 31st Mar 22 30th Sept 22 31st Mar 23 30th Sept 23 Source: Corporation data, 14
Slide 16: Annualized Premium Equivalent (APE)
2/8/2024 Annualized Premium Equivalent (APE) INR Crore Year on Year Line of Business 9MFY23 9MFY24 Growth A Individual Par 21,206 20,203 (4.73) % B Individual Non Par¹ 2,213 3,299 49.08% 1 Individual Saving 283 1,449 412.10% 2 Protection 189 127 (32.66)% 3 Annuity 936 991 5.94% 4 ULIP 805 732 (9.10)
Slide 17: Focus on Increasing Share of Non-Par Products
2/8/2024 Focus on Increasing Share of Non-Par Products Rising share of Non-Par in Individual APE1 Breakup of Individual APE (9MFY23) Breakup of Individual APE (9MFY24) Non- Par Non- Par 90.55% 9.45% 85.96% 14.04% Par Par Source: Corporation data; 1. Within India Business 16
Slide 18: Value of New Business (VNB)
2/8/2024 Value of New Business (VNB) Amounts INR crore LIC of India 9MFY23 9MFY24 Net VNB1 5,478 5,938 Net VNB Margin 14.6% 16.6% Individual Business1 Group Business1 9MFY23 9MFY24 9MFY23 9MFY24 Net VNB 3,743 4,178 Net VNB 1,736 1,760 Net VNB Margin 16.0% 17.8% Net VNB Margin 12.3% 14.3% Par Busines
Slide 19: VNB Walk 9MFY23 to 9MFY24
2/8/2024 VNB Walk 9MFY23 to 9MFY24 Source: Corporation Data 18
Slide 20: Improvement in Persistency Ratios
2/8/2024 Improvement in Persistency Ratios On No. of Policies Basis - Improvement in 13th month Persistency ratio by # policies 64.99% 67.22% 59.06% 58.59% 55.32% 54.80% 52.45% 52.01% 51.42% 50.23% 13th Month 25th Month 37th Month 49th Month 61st Month 9MFY23 9MFY24 On Premium Basis – Improvement in
Slide 21: Policyholders Age and Policy Term
2/8/2024 Policyholders Age and Policy Term Average Age in Years1 Average Policy Term in Years1 57 43 39 37 30 32 31 23 9 2.21 Annuity Protection ULIP Non Par Savings Par Annuity Protection ULIP Non Par Savings Par Source Corporation data as on 31.12.2023, Note ¹Age and Term for Individual New Busine
Slide 22: Marketing and Distribution Strengths
2/8/2024 MARKETING AND 4 DISTRIBUTION STRENGTHS
Slide 23: Robust agency force
2/8/2024 Robust agency force Largest agency force # Agents in lacs 13.92 13.74 13.47 12.81 12.09 10.70 Higher Vintage: 63.10% > 5 Years FY20 FY23 9MFY24 Others LIC LIC has dominant agency force – 49.67% of life insurance Industry. Source: Corporation data and life council data as on 31.12.2023; 22
Slide 24: Exclusive agency network well trained leading to highest productivity
2/8/2024 Exclusive agency network well trained leading to highest productivity Loyal agency network with a mix of youth and experienced professionals Mix of agents by age group Mix of agents by tenure Above 60 yrs 18-30 yrs 11% 14% 63.10% 31-35 yrs 51-60 yrs 12% 22% 36.90% 36-40 yrs 13% 41-50 yrs Up
Slide 25: Agents' training
2/8/2024 Agents’ training Training in Sales Training 17,433 Agents fulfilling the Total number of training Centres and Zonal MDRT criteria¹ infrastructure - 732 Training Centres – 1,81,308 Total 2,78,653 agents trained in 80% 76.05% Agents recruited within 9MFY24 the 18-40 years age group Imparted t
Slide 26: Feet on Street – LIC's Core Distribution Strength
2/8/2024 Feet on Street – LIC’s Core Distribution Strength Organizational Structure Agents Training Infrastructure CO 2.11% Employees Office 8 Zonal Training Centers 8 Zonal Office 2.90% Employees 35 Sales Training Centers 113 Divisional Office² 13.89% Employees 113 Divisional Training Centers 2,130
Slide 27: Differentiated business model with deep competitive moats
2/8/2024 Differentiated business model with deep competitive moats Geographic Distribution of Individual Agents (%) 56.21% 51.78% 48.22% 43.79% 9MFY23 9MFY24 Rural Urban Pan India presence of Agents which shows our feet on street Source Corporation data as on 31.12.2023 26
Slide 28: Enhancing focus on building Omni-channel distribution network
2/8/2024 Enhancing focus on building Omni-channel distribution network Snapshot of LIC’s vast distribution capabilities Premium points +2,732 MICRO 13.74¹ lacs Agents exclusive to LIC 39,829³ Insurance Premium Points 1602 Corporate Agents 290 Brokers 144 Insurance Marketing Firms 36 Covering 92% dis
Slide 29: Enhancing focus on building Omni-channel distribution network
2/8/2024 Enhancing focus on building Omni-channel distribution network Snapshot of vast distribution capabilities of LIC Distribution mix by Individual NBP (%) Individual NBP sourced in India via the banca and alternate channels (INR Crore) 9MFY 23 Particulars Others 1,423.4 Banca 3.50 % +05.02% Dig
Slide 30: Focus on Increasing Share of Non-Par Products
2/8/2024 Focus on Increasing Share of Non-Par Products Breakup of Individual New Business Breakup by premium (9MFY24) Breakup by no. of policies (9MFY24) Non- Par Non- Par Non Par NB Par Non Par Particulars Par Particulars share NBP share (# policy) 59.86% Term 0.29 % Term 0.29 % 93.26% Health Insur
Slide 31: Group Business Segment
2/8/2024 Group Business Segment INR in Crore New Business Premium Market Share ( by premium) 1,37,240 78.65% 1,08,796 72.24% 9MFY23 9MFY23 9MFY24 9MFY24 9MFY23 9MFY24 9MFY23 9MFY24 30 Source: Corporation data.
Slide 32: Achieving Operational Efficiencies
2/8/2024 ACHIEVING OPERATIONAL 5 EFFICIENCIES
Slide 33: Deeply entrenched into Bharat
2/8/2024 Deeply entrenched into Bharat Extensive domestic distribution network… Assam Jammu & Arunachal Breakup of our Business State wise² Kashmir; Ladakh Pradesh Meghalaya Punjab Himachal Pradesh Chandigarh Uttarakhand Tripura Haryana Delhi Sikkim Uttar Pradesh Rajasthan Bihar Madhya Pradesh Jhark
Slide 34: Share of women in policies issued
2/8/2024 Share of women in policies issued Rising Share of women in policies sold¹ In 15 States/UTs, the share in number of policies bought by women to the total policies sold was higher than the all-India average of 34.2%² 44% 44% Top 5 and bottom 5 states/UTs 43% 43% 42% 30% 30% 28% 27% 23% Out of
Slide 35: Technological innovations at LIC
2/8/2024 Technological innovations at LIC Solutions designed to enhanced operational efficiency and respond with speed to specific situations Ananda APP – launched during COVID to enable Agents to do business without meeting Digital App for Agents to process New Business digitally customers face to
Slide 36: Strengthening Digital Process – Empowering Policyholders
2/8/2024 Strengthening Digital Process – Empowering Policyholders AI Chat Bot 1. Policy Status Application to facilitate submission of 2. First Unpaid Premium date Digital existence certificate for LIC docQ Application helps user to 3. Last paid premium date individual pension plan and staff submit
Slide 37: Empowering policyholders and agents in a digital world
2/8/2024 Empowering policyholders and agents in a digital world Source Corporation data 36
Slide 38: Strengthening Digital Process – Driving Operational Efficiency
2/8/2024 Strengthening Digital Process – Driving Operational Efficiency Print to Post Solution – Developed with Postal Department of India for Policy bond printing & deliveries Tracking of policy bond Dispatch of policy bond Undelivered policies return through speed post tracking through speed post
Slide 39: Strengthening Digital Process – Customer Service
2/8/2024 Strengthening Digital Process – Customer Service Online service requests Loan payment and repayment 8 1 e-NACH2 Change of Nomination & 7 PAYMENT RELATED 2 POLICY RELATED Assignment Unit Linked fund switch PAN1 data registration 6 3 NEFT3 registration Aadhaar based change of address 5 4 Chan
Slide 40: Strengthening Digital Process – Customer Service
2/8/2024 Strengthening Digital Process – Customer Service Services offered Verified Automated conversation messages WhatsApp services started in Dec-22 and 1.92 crore customers opted/enabled until Streamlined December-23 Ease of customer interaction services Uptrend in LIC customer APP users Rising
Slide 41: Strengthening Digital Process – Driving Operational Efficiency
2/8/2024 Strengthening Digital Process – Driving Operational Efficiency Increasing digital collection across channels (percentage to total transaction) 28.39% 27.55% 25.55% 24.29% 23.67% Other App includes: Amazon Pay ,Bajaj 22.46% Finserv, CRED, Free Charge, GPay , InstaPay, JustDial, Mobikwik, Pho
Slide 42: Customer care – at our core philosophy
2/8/2024 Customer care – at our core philosophy Settled total death claims of Rs. 16,288 crore in 9MFY24 as against Rs. 17,350 crore in 9MFY23. Claim settlement ratio (Death) in 9MFY24 is 98.46% by number as against 97.43% in 9MFY23*. The number of policyholders complaints per 10,000 policies
Slide 43: Key Focus Areas
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Slide 44: Strategy – Key Focus Areas
2/8/2024 Strategy – Key Focus Areas #1I. Diversify Product Mix – Continued focus on enhancing Non Par Share. #2I. Launch New Products based on customer and channel needs. #3I. Increase focus on digital and technology areas to drive efficiency. #4I. Create optimum mix of distribution channels while r
Slide 45: Appendix
2/8/2024 ard sitet srr LIFE INSURANCE CORPORATION OF INDIA @ sprenvix AA
Slide 46: Highly Experienced Management, Distinguished Board and Strong Corporate Governance framework
2/8/2024 Highly Experienced Management, Distinguished Board and Strong Corporate Governance framework Shri Siddhartha Mohanty Dr. M. P. Tangirala Shri M Jagannath Shri Tablesh Pandey Whole-time Chairperson Government Nominee Managing Director Managing Director Director Shri Sat Pal Bhanoo Shri R Dor
Slide 47: Financials - Standalone Balance Sheet
2/8/2024 Financials - Standalone Balance Sheet (INR lakhs) For the Year ended For the nine months ended Particulars March 31, 2022(Standalone) March 31, 2023(Standalone) Dec. 31, 2022(Standalone) Dec. 31, 2023(Standalone) Sources of funds Shareholders' funds: Share capital 6,32,499.77 6,32,499.77 6,
Slide 48: Financials - Standalone Statement of Revenue (Policyholders' Account)
2/8/2024 Financials - Standalone Statement of Revenue (Policyholders’ Account) (INR lakhs) For the year ended For the nine months ended Particulars March 31, 2022(Standalone) March 31, 2023(Standalone) Dec. 31, 2022(Standalone) Dec. 31, 2023(Standalone) Premiums earned - net (a) Premium 4,28,02,497.
Slide 49: Financials – Standalone Statement of Profit & Loss (Shareholders' Account)
2/8/2024 Financials – Standalone Statement of Profit & Loss (Shareholders’ Account) (INR lakhs) For the year ended For the nine months ended Particulars March 31, 2022(Standalone) March 31, 2023(Standalone) Dec. 31, 2022(Standalone) Dec. 31, 2023(Standalone) Amounts transferred from/to the 12,19,345
Slide 50: LIC – Group Structure
2/8/2024 LIC – Group Structure Foreign branches1 Subsidiaries Associates Country Entity Country Entity Stake held (%) Country Entity Stake held (%) Fiji Branch 100.00% 45.24%3 Mauritius Branch 100.00% 5.38%3 United Kingdom Branch 99.66%2 49.24%4 Equity Participation 100.00% Country Entity Stake held
Slide 51: India is one of the fastest growing major economy
2/8/2024 India is one of the fastest growing major economy (GDP Growth, Percentage year-on-year) 10 5 0 -5 -10 -15 2014 2015 2016 2017 2018 2019 2020 2021 2022P 2023P 2024P 2025P India 7.4 8 8.3 7 6.1 4.2 -8 9 9 7.1 6.3 6.2 China 7.3 6.9 6.8 6.9 6.7 6 2.3 8.1 4.8 5.2 5.2 5.1 Japan 0.4 1.2 0.5 2.2 0.
Slide 52: Share of life insurance in incremental household financial saving
2/8/2024 Share of life insurance in incremental household financial saving 120.00% 100.00% 12.30% 14.70% 13.40% 2.70% 1.90% 6.60% 80.00% 13.00% 12% 14.50% 18.70% 19.30% 60.00% 16.70% 16.80% 15.00% 40.00% 19.40% 20.00% 36.50% 36.60% 29.40% 0.00% FY 19 FY 20 FY 9M21 Bank Deposits Life Insurance Funds
Slide 53: Protection gap for different countries
2/8/2024 Protection gap for different countries 90% 83% 80% 76% 74% 71% 70% 70% 61% 60% 55% 55% 54% India’s protection 50% gap for India was 41% 83% as of 2019, the 40% highest among all countries in Asia- 30% Pacific¹ 20% 10% 0% India Indonesia Malaysia Thialand Chaina Japan South Singapore Austral
Slide 54: Well positioned to ride the growth in a highly underinsured market
2/8/2024 Life Insurance Penetration %age FY 2022 Insurance Density (in US$)1 FY 2022 20 9000 8433 18 17.3 8000 16 7000 14 6000 5414 12 11.6 5000 10 4234 10 8.9 3772 4000 8 7.5 2866 6.1 6.1 3000 2654 5.8 2347 6 1971 1837 3.9 2000 4 3.4 3.2 1321 1000 698 623 2 444 253 246 160 69 0 0 WELL POSITIONED TO
Slide 55: Household savings to increase
2/8/2024 Household savings to increase Household Savings (% of GDP) 30.00% Household 25.20% saving as 25.00% 23.60% 23.10% 23.60% percentage 22.40% 22.50% 22.20% 20.30% 20.30% of GDP 19.60% 19.30% 19.60% 20.00% 18.00% 18.10% rose to 22.2% in 15.00% fiscal 2021 10.00% 5.00% 0.00% FY08 FY09 FY10 FY11
Slide 56: Embedding ESG in our business - building a sustainable future for the communities
2/8/2024 Embedding ESG in our business - building a sustainable future for the communities LIC has integrated the SDGs with key areas of their business operations. LIC initiatives have ensured a positive contribution to at least 14 of the 17 SDGs 43.79% agents in India reside in rural areas “Bima
Slide 57: Embedding ESG in our business - building a sustainable future for the communities
2/8/2024 Embedding ESG in our business - building a sustainable future for the communities LIC has integrated the SDGs with key areas of their business operations. LIC initiatives have ensured a positive contribution to at least 14 of the 17 SDGs Support to various other sanitation projects by LIC
Slide 58: Embedding ESG in our business - building a sustainable future for the communities
2/8/2024 Embedding ESG in our business - building a sustainable future for the communities LIC has integrated the SDGs with key areas of their business operations. LIC initiatives have ensured a positive contribution to at least 14 of the 17 SDGs Outstanding investments worth INR 14.1bn¹ in renewab
Slide 59: Committed to ESG initiatives across the organization
2/8/2024 Committed to ESG initiatives across the organization Roof top solar capacity installed (KW) Total Reduction of carbon emissions (in tons) 5,175 4,308 4,471 3,826 2,966 3,376 2,856 3,141 2,051 2,254 1,812 2,024 FY 2019 FY 2020 FY 2021 FY 2022 FY2023 9MFY24 FY 2019 FY 2020 FY 2021 FY 2022 FY2
Slide 60: Awards & Accolades
2/8/2024 Awards & Accolades 59 Source: Corporation data as on 31.12.2023.
Slide 61: Glossary
2/8/2024 Glossary New Business APE: The sum 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 yea
Slide 62: Abbreviation
2/8/2024 Abbreviation 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 (Rs.) Indian Rupees IRP
Slide 63: Disclaimer
2/8/2024 Disclaimer Except for the historical information contained herein, statements in this presentation which contain words or phrases such as ‘will’, ‘would’, ‘indicating’, ‘expected to’ etc., and similar expressions or variations of such expressions may constitute ‘forward-looking statements’.
Slide 64: Thank You
2/8/2024 THANK YOU Investor Relations Contact: Life Insurance Corporation of India Yogakshema, Third Floor, West Wing, Jeevan Bima Marg, Nariman Point, Mumbai- 400021. Contact # +91 66599401 Email - investorrelations@licindia.com Website – www.licindia.in
Life Insurance Corporation of India — Q3 FY2024 Earnings Presentation on 6ix