Max Financial Services Limited · NSE:MFSL
Max Financial Services — Investor Day (November 2021)
64 slides from Max Financial Services's investor day presentation, Nov 30, 2021
Slide 1: Max Life Insurance Investor Day
Max Life Max Insurance Life Insuranc Investor Day Investor Day November 30, 2021 LEAD 8th Ranked Great Place THE 1 To Work 6A Max Financial and JAX1S BANKJV Certified o DIFFERENCE in India /aims PO
Slide 2: Presenters for the day
Presenters for the day dir a Prashant Tripathy Managing Director & CEO V Viswanand Deputy Managing Director Manu Lavanya Amrit Singh Director & Chief Operations Officer Chief Financial Officer Jose John Sachin Saxena Senior Director & Appointed Actuary Chief Risk Officer Suhail Ghai Chief Digital &
Slide 3: Agenda for the Day
• Agenda for the Day Future Outlook – Max Life’s Strategic Roadmap Innovating for customer segments and building distribution of the future Pervasive intelligence and automation across • the enterprise Strategic Risk Management Q&A: Interaction with the Management team
Slide 4: Future Outlook – Max Life's Strategic Roadmap
Future Outlook–Max Future Life’s Strategic Outlook-Max Life's roadmap Strategic roadmap Prashant Tripathy Amrit Singh Managing Director Chief Financial Officer and CEO November 30, 2021 1ddla% sham%et ota LEAD 18th Ranked Great Place To THE Work 6 A Max Financial and AAXIS BANKJV Certified ta fa 'l3
Slide 5: Purpose driven Organization
Purpose driven Organization )
Slide 6: Purpose
Purpose Inspire People to Increase the Value of their Life 6
Slide 7: Our Values
OUR VALUESCustomer Obsession: Customer at the core Growth Mindset: Curious to learn, Hungry to win Caring: Respect people, Act with compassion Collaboration: Stronger together 7
Slide 8: Max Life presence across India and distribution partners
Max Life has an extensive presence across India through its own offices and distribution partners and is the 4th largest private Life Insurance player Max Life has more ~6500 Point of Sales across the country 4th Largest Private Life Insurer^ 358 Own Branch Units •: 9 9 6000+ Partner Branches • ~10%
Slide 9: Key Highlights for Max Life (1/2)
Key Highlights for Max Life (1/2) Consistent growth Improved 5-Yr CAGR of 18% on Consistently maintained Individual new business market share 4 rank#4 vs from since last 5 years 13% of Top 3 listed life insurers 9.3% to 10.8% in 5 years New Business Margin 5-Yr EV VNB CAGR of 27% expansion from 17.9
Slide 10: Key Highlights for Max Life (2/2)
Key Highlights for Max Life (2/2) Great Places to Experienced leadership Employee metrics Asia's Best Employee engagement1 Work rank #18 in FY21 Workplaces 2021 with almost half consistently among the leadership’s the top decile Rank #55 among Great Places tenure with Max Life more than a decade (FY
Slide 11: Big trends that will shape the industry
) Big trends that will shape the industry
Slide 12: Life Insurance is a business of Risk Management
Life Insurance is a business of Risk Management; plays available for Life Insurers include Disciplined savings, Mortality & Morbidity and Longevity Disciplined savings A Mortality & Morbidity B Longevity C 12
Slide 13: Financialization and formalization of economy continues
Financialization and formalization of economy continues. India continues to maintain high savings culture and Life Insurance among the preferred asset classes Household Savings flow – Growth in financial assets flow higher than physical assets flow over 5 years Individual tax filers nearly doubled1
Slide 14: Protection gap in India is large
Protection gap in India is large; long term protection opportunity huge Retail protection market grew ~6X1 over the last 5 years in India Protection gap for India is significant Protection Gap (2019) 83% 76% Only 1 out of 40 people2 (2.5%) who can afford it, is buying a 70% 61% term policy III 55% 4
Slide 15: Increasing consumer awareness for health & wellness products
Increasing consumer awareness for health & wellness products Large incidents of non-communicable diseases along with significantly high out-of-pocket expenses on healthcare in Health insurance penetration relatively low in India India Health Insurance Penetration (2019) 4.1% As per BCG Top 10 Consum
Slide 16: Demographics and need for pension products
Change in demographics, emergence of nuclear families and advancement of healthcare facilities leading to pronounced need for pension products India’s pension market is under-penetrated Change in demographics and emergence of nuclear families; at ~7% of GDP population >60 years likely to become 1.4X
Slide 17: Increasing adoption of digital and personalization
Increasing adoption of digital; customers now more transparent in sharing data and expect personalization Government push towards Digital adoption Share of digital transactions in the total volume of Aadhar UID non-cash retail payments at ~98% in FY211 DigiLocker e-KYC I Air e-Sign Ey p • Number of
Slide 18: Strategic Direction for Max Life
Strategic Direction for Max Life )
Slide 19: Next 5 years Strategic Thrust Areas
Next 5 years Strategic Thrust Areas 1 2 3 4 5 Fastest Leader in growing Protection Leader in profitable + Health & online proprietary Wellness Leader in Inorganic acquisition distribution • proposition Retirement Expansion Digital and AI enablement Leverage strategic partnership with Axis People cap
Slide 20: Max Life's 5-Year Aspirations
Max Life’s 5-Year Aspirations . • • • . • • 1 OtiM •2 Fastest growing • 3 Leader in Protection + • 4 •5 Leader in online profitable proprietary Health & Wellness Leader in Retirement Inorganic expansion acquisition distribution proposition Leader in online #5 player in offline #5 player in Protectio
Slide 21: ESG Strategy and Key Targets
Max Life’s ESG Strategy revolves around four pillars and has set bold aspirations to drive Organization towards sustainability ® A B Digital C D Work Ethically & Sustainably Care for People & Society Financial Responsibility Green Operations Robust Corporate Diversity & Inclusion Sustainable I
Slide 22: Thank You
Thank You •
Slide 23: Innovating for customer segments and building distribution of the future
Innovating for Innovating for customer segments and customer-segments and mow building building distribution of the distribution of the future future ur V Viswanand Deputy Managing Director November 30, 2021 LEAD Ranked h n ketc. Great Place To THE Work 6A Max Financial and JAX1S BANKJV Certified DI
Slide 24: Max Life has built a challenger consumer brand
Max Life has built a challenger consumer brand emphasising importance of individual and value the consumer ascribes to self AMAX NoLIFE A Brand that inspires people to increase the value of their life 4 A Brand that caters to all key needs of the consumer – protection, 1k savings, wealth creation, r
Slide 25: Products innovation: first-in-industry propositions
Max Life has been at the forefront of driving Products Innovation by creating first-in-industry propositions 1. Break the endowments category clutter with 6. Enabled transparent customer participation 10. Hedged Guarantees with Derivatives Industry First Whole Life plan in Bonds with First Index-Lin
Slide 26: Trusted advice through well trained sales & service force
Max Life has established a reputation for providing trusted advise through a well trained sales & service force Virtual Relationship Right Advise through Highest share of Dil Se Ek – Axis MLI Manager for all Agent Advisors selection online* Partnership customers I \\ We aspire to be the epitome of t
Slide 27: Four consumer segments with distinctive traits
Max Life sees our consumer segments across four categories and they have distinctive traits ) Gen Z (<25 yrs) Gen X (40-55) ~8% c, ~30% Digital savvy Millennial (25-40) Retiree (>55) Prefer DIY, online ~57% ~5% More risk taking ability Seek safety & security Seek personalized advice Info
Slide 28: Diversified distribution network for consumer segments
Max Life has a well diversified distribution network to cater to these consumer segments Gen Z Millennial Gen X Retiree Mix* Median Median Age Income PROPRIETARY ONLINE A 16% 36 C7-8L PROPRIETARY OFFLINE 27% 40 5-6L PARTNERSHIPS 57% 40 6-7L *Basis FY21 number of policies 28
Slide 29: Geographic coverage in line with distribution reach
… and cover geographies in line with their distribution reach Top 20 Cities Other Geographies PROPRIETARY ONLINE PROPRIETARY OFFLINE PARTNERSHIPS 358 own branch units 6k+ bank branches *Basis FY21 number of policies 29
Slide 30: Differentiated distribution through dedicated verticals
Max Life’s distribution is differentiated in the market through dedicated org verticals, process execution rigour, deep digitalisation and integration with distribution partners Proprietary Online Proprietary Offline Partnerships • Leadership position at biggest • Demonstrated 4-Yr VNB CAGR of 34% •
Slide 31: Max Life distribution aspirations
As we look forward, Max Life has set the following aspirations 7-0-7a 00 000 Online Proprietary Partnership Leader in 17% CAGR (5Yr) 20% CAGR (5Yr) FROM Protection Leader in Fastest growing Deeper TO Savings & profitable integration to Protection proprietary deliver superior channel growth CAGR on I
Slide 32: Online proprietary aspirations
Online proprietary aspirations From To 000 Leader in Protection 000 Leader in savings and protection rv-rn"" Leader in online ., protection and b Strong D2C platform Build world-class D2C platform savings 25+ partnerships Ecosystem partner of choice Highest share of selection at India’s tat Pilot mo
Slide 33: Offline proprietary aspirations
Offline proprietary aspirations From To Accelerate proprietary growth through Profitable offline channels D C, 0 D C, agency variablization and geographic expansion Fastest growing profitable Best-in-class agent productivity proprietary Omni channel orchestration through distribution digital & AI en
Slide 34: Partnership aspirations
Partnership aspirations From To liii 2 big bank partners Add new partners Scale up across all Bank segments – Deeper digital / virtual integration to Tech integration with partners deliver superior Tap into health, retirement and growth protection opportunity Present in all bank touchpoints Analytic
Slide 35: Thank You
Thank You •
Slide 36: Intelligent and pervasive automation across the enterprise
Intelligent and Intelligent and pervasive pervasive automation automation across the across the enterprise enterprise '444111 hr.- -v Manu Lavanya Suhail Ghai 111111110 Chief Operations Chief Digital & Officer Information Officer November 30, 2021 Great Ind a " a shau0Ste LEAD Ranked Place THE 18th
Slide 37: Max Life is a leading Digital Insurer in India
Max Life is a leading Digital Insurer in India 3 second 99.35% Page Load Time Claims paid Text BEST IN CLASS BEST IN CLASS DIGITAL FRICTIONLESS NATIVE CUSTOMER TALENT ONBOARDING 49% 100% ( 6L Insta claim Systems of Engagement DIGITAL Policies DIGITAL Text SALES Issued SELF-SERVE Text settlement On c
Slide 38: Max Life's Digital Strategy is based on 9 Key Pillars
Max Life’s Digital Strategy is based on 9 Key Pillars Scale eCommerce Onboarding / Business 1 Digital Sales 2 Issuance IN 3 Customer Service 4 Enterprise 5 Digital Marketing Muscle Intelligent & Integrated Digital Native Omni Channel customer Mobile First Employee (Sharper prospecting) LEA
Slide 39: Digital native frictionless and intelligent onboarding journeys
Max Life has built digital Native Frictionless & Intelligent onboarding • 1&3 Journeys….. Key Accomplishments Mobile First Frictionless Key Accomplishments B2C Journey B2B % of Customers to Max Life 48%* Insta Issuance 18% 16% inPRO 16% 14% 12% 10% rn,PRI7 65% Human less U/W 8% 6% 4% 5 Cu orn. 0 tu
Slide 40: Agency enabled with digital tools across the value chain
2 Max Life’s Agency is enabled with digital assets end-to-end across the value chain Recruitment •• >> Learning >> Lead Generation >> Prospecting >> On boarding >> Servicing > M REC muddy Learning Management System nCluote 47717R0 CMPOWER J Attr, /Alec Dashboard Quote elf =1111* POWER El muddy 0, HR
Slide 41: Cross sell engine
2 Max Life has set up a channel focused exclusively on cross-selling, powered by strong analytics T-( .! A. -,3 0 INTELLIGENCE OFFER GENERATION EXECUTION tit PASA r Trigger Customer Data Personalised offer Lead warm up WhatsApp Video Cross sell engine High Relaxation of 0 CALL TO requirement >44 Med
Slide 42: Deep integration with Bank partners
Deep integration with Bank partners - multiple innovations to increase productivity, drive growth, sales efficiency and improve customer experience through reduced friction • 2 at Axis Bank Multiple innovations to New Customer Touchpoints Enhanced sales team capability System / Tech integration impr
Slide 43: High tech - high touch servicing model
4 Max Life is delivering the vision of “HIGH TECH - HIGH TOUCH” servicing model by providing omni-channel service experience to our customers Customer initiated ---- > KPI Customer's World RM's World 50L+ self-service o. transactions annually I API f 82% adoption (S1ADD +1/11113) 09E Jauunsn3 Web Br
Slide 44: Analytics capabilities across the value chain
6 Max Life has built capabilities across analytics spectrum to accelerate our journey of embedding intelligence across the value chain Capabilities Industry Recognition Best Data Science Top 40 Under 40 data Nasscom AI Game Changers Vision AI Conversational AI Award Project Award scientists Award Co
Slide 45: AI and ML solutions deployed across the value chain
Max Life has developed and deployed multiple solutions to enhance • 6 top line, optimize effort and proactively identify and manage risk New Business Purchase & Issuance Servicing, Retention & Claims Speech Analytics engine for Customer insights, call sentiment, s*4 ield Shield Early Claim & Fraud r
Slide 46: Technology foundation and people capability
7–8 ….aided by investments in strong technology foundation and People capability Digital Talent New Age Tech Foundation I 38% r 50+ Data Compute on Scientist and Azure aws Cloud Engineers 70% FY2023 Dedicated AI works Team since 2010 Move to Elastic Cloud Infrastructure !MM.. • ....verk.1,144. gall
Slide 47: Max Life Innovation Labs 2.0
THE SEARCH FOR THE NEXT BIC SPARK BEGINS, • 9 We are building innovation Muscle through Max Life Innovation Labs 2.0 -( MAX LIFE >200 INNOVATION Applications received LABS for Innovation Labs 2.0 PARTNERS USECASES SHORTLISTED FOR POC PARTNER startupindda .411A INVEST INDIA • Non Invasive Medical Tes
Slide 48: Digital ecosystem partnerships with InsurTech
9 Partnerships with InsurTech Eco system is accelerating our digital Journey :Karla %PI b.,-41.- LAPETUS Kwantics Finarkein i n„, ,ed Analytics •.::.• •• • • Experiarr 0 Cogno Al protiviti Digital DOCSA PP Ecosystem senseforth.ai Vidzdi ANUR CLOUD % nepik Chapter Vitamin Sales & Vernacular.ai toistr
Slide 49: Our goal in 12-18 months: leading Digital First Life Insurer
Our Goal in 12-18 months: We will be a leading Digital First Life Insurer Industry Leading AI/ML Driven Intelligent High- Touch High-Tech Iindustry Leading Digital Organization Customer Experience 300+ Engineers Digital Maturity Onboarding Experience Driven Online Channel <3 Seconds Page Load 15% Se
Slide 50: Thank You
Thank You •
Slide 51: Strategic Risk Management
4 Strategic Risk Strategic Risk Management Management Sachin Saxena Jose John Chief Risk Officer Appointed Actuary November 30, 2021 LEAD 8th Ranked Great Place THE 1 To Work /aims PO ,Lso DIFFERENCE in India Certified A Max Financial and JAX1S BANKJV
Slide 52: 3 Lines of Defense model to manage risks
3 Lines of Defense (LOD) model deployed to manage risks. Independent and experienced functionaries with direct access to Board 3 Board of Directors Risk Assurance C Review and Audits Risk Control Functions - Risk, 2 Risk, Ethics and ALM Committee (REALMC) Control Compliance, Actuarial 1 Management R
Slide 53: Risk Management Framework of Max Life
Risk Management Framework of Max Life Risk Management System Risk Policy Matters requiring CRO approval & consultation Independent review of annual business plan by CRO Identification of Material Risks I ‘Overarching Constraints’ on Key Outcomes Risk Appetite Statement 0 Quantified appet
Slide 54: Key Risks facing a Life Insurer
Key Risks facing a Life Insurer Strategic Risks Insurance Risks Economic Risks Operational Risks General Business Strategy Mortality Credit Risk Cyber Security Channel Concentration Discontinuity Market Risk Business Continuity Product Mix – Non-par Expenses Interest Rate Risk
Slide 55: Differential approach to manage key risks
Differential approach to manage key risks makes Max Life a ‘Resilient & Risk Intelligent’ organization A 0a • 11 I Preventable Risk External Risks Strategic Risks Risks arising from within the External, uncontrollable Risks taken for superior company that generates no risks strategic returns s
Slide 56: Best in Class Actuarial Governance and Prudence
‘Best in Class’ Actuarial Governance and Prudence deployed to manage risks O World class skill and expertise: The General Commercial and Economic Environment Actuary on the Board Standalone Board Committee for reviewing Actuarial matters One of the largest pool of fully qualified actuaries wit
Slide 57: Approach on Mortality and Persistency Risk
Approach on Mortality and Persistency Risk =o: Customer Profiling and Experience monitoring: Profitability & Risk Selection: Management: Regular portfolio review/ Post AI based risk models, Credit issuance verification Regular repricing of products Bureaus, IIB Database deployed in underwritin
Slide 58: Approach on Interest Rate Risk
Approach on Interest Rate Risk Robust Asset Liability Focused Product Management: Resilience and Expert Validation: Management Framework: Product design - repricing to align Direct Board oversight on the Cash flow and duration matching benefits with current rates with amount of interest-sensit
Slide 59: Approach on Investment Risk Management
Approach on Investment Risk Management Clearly segregated and independent Investment sub offices, together managing all aspects of investment risk Front Office – Led by CIO ri Middle Office – Led by CRO rx Back Office – Led by CFO ALM is primary aim for Traditional Independent credit review of p
Slide 60: Approach on Information Security and Business Continuity Risk
Approach on Information Security and Business Continuity Risk • - C -OW 4. C Business Continuity: Cyber DARE framework for Internal and External Validation: managing security goals: Robust framework based on ISO Dedicated CISO, internal security 22301 Robust framework based on ISO team and ext
Slide 61: Approach on Operational Risk
Approach on Operational Risk I Preventive Programs A Detective Programs g Corrective programs Multi-tier governance and Customized Incident Revenue Assurance model automation for highest Management program for concurrent checks impact areas Enterprise-wide tool for Cross functional forum f
Slide 62: How are we different
How are we different.. 1 Independent roles of Appointed Actuary, Chief Risk Officer, Chief Compliance Officer and Chief Audit Executive 2 Standalone Board Committee for reviewing Actuarial matters 3 CRO involvement in all matters of strategic importance with independent review of business plan 4 Qua
Slide 63: ERM Team's Proud Moments – Recognitions
ERM Team’s Proud Moments – Indian and Global Recognitions 7110444: ,„ "'"Ik WINNER 4 TH 4,11GLOBAL C15620106 .ASIA INSURANCE CONGRATULATIONS INDUSTRY AWARDS A WINNING TEAM 202Q‘i, ABHISHEK BANSAL #CISO100 HOTTOP ICS.HT AS +Ts uunoas IN PARTNERSHIP WITH CISO Sriar 19L13. :;,• 24th Asia Insurance Indu
Slide 64: Thank You
Thank You •
Max Financial Services — Investor Day (November 2021) on 6ix