Leadership adership in life fe insurance rance Nov ovember - PowerPoint PPT Presentation

Leadership adership in life fe insurance rance Nov ovember ember 2015 015

Agend enda Indust stry ry over ervie view w Outlook ok Company any st strategy tegy and per erformanc rmance 2

Agend enda Indust stry ry over ervie view w Outlook ok Company any st strategy tegy and per erformanc rmance 3

Evolution ution of life e insu suranc ance e indust stry y in India FY2010 10 FY2002 02 FY2015 15 New busine siness s premium remium 1 21.5% -5.8% 408 408 550 550 116 116 (Rs bn) n) 4.3% Total tal premi emium um (Rs bn) n) 23.2% 3,277 501 501 2,655 Penetra netration tion (as as a % to 2.8% 2.1% 2.6% 2.1% 4.1% GDP) P) Assets ets under der 12.7% 24.0% 2,304 12,899 99 23,442 42 manageme nagement nt (Rs bn) n) 16.0% In-fo In force ce sum assured ured 2 15.5% 37,505 05 11,812* 12* 78,786 86 (Rs bn) n) In-fo In force ce sum assured ured (as s 62.8% 50.1% 57.9% % to GDP) P) 1. Retai ail l weig ighted ted premium mium 2. Individ ividual al and Group in-forc rce e sum assu sured ed 4 Sourc rce: : IRDA DAI, I, CSO, Life insuranc urance counc ncil il * Comp mpany any estim imat ate

New busine ness ss 1 : : Pri rivate te player yers s showin wing g stro rong g gro rowth Growt wth FY2012 FY2013 FY2014 FY2015 H1FY20 Y2016 Privat ate -23.9 .9% 1.9% -3.4% 15.9% 15.2% LIC 11.2% 2% -4.1% 1% -3.4% 4% -26.3 .3% -11.1 .1% Industry ry -4.8% -1.9% -3.4% -10.3 .3% 0.4% 350 35 60 60% 49.0% 0% 300 30 50.2% 2% 50% 50 45.7% 7% 25 250 38.0% 0% 36.5% 5% 38.0% 0% 40 40% 200 20 bn Rs bn 30 30% Rs 15 150 20 20% 100 10 10 10% 50 50 0 0% 0% FY20 FY2011 11 FY2012 FY20 12 FY2013 FY20 13 FY20 FY2014 14 FY20 FY2015 15 H1FY2 1FY201 016 LIC LI Priv ivat ate Priv ivat ate mar market t shar hare 1. Retai ail l weig ighted ted new busin iness s premium mium 5 Sourc rce : IRDA DAI, I, Life insuranc urance counc ncil il

Bancas ncassu suranc rance e dominant ominant chan annel nel for r priva ivate te players yers 1 Indust stry ry Privat ate players rs 6% 6% 6% 6% 6% 6% 8% 8% 8% 8% 17% 17% 17% 17% 16% 16% 17% 17% 19% 19% 15% 15% 16% 16% 16% 16% 21% 21% 20% 20% 39% 39% 43% 43% 44% 44% 47% 47% 48% 48% 79% 79% 78% 78% 78% 78% 71% 71% 71% 71% 44% 44% 40% 40% 40% 40% 36% 36% 33% 33% FY FY20 2012 12 FY FY20 2013 13 FY FY20 2014 14 FY FY20 2015 15 Q1 Q1FY FY201 016 FY FY20 2012 12 FY FY20 2013 13 FY FY20 2014 14 FY FY20 2015 15 Q1 Q1FY FY201 016 Agency Bancas Ban assuranc urance Others Othe rs Agency Ban Bancas assuranc urance Othe Others rs  Given Given a well ell deve evelope ped banking anking sec sector, tor, ban ancas cassur surance ance has has beco come me lar argest gest channel nnel for private rivate player ayers  LIC- 95 95% of of Indi dividual idual new busine siness sales les contribute ntributed by by agency ency 1. Individ ividual al new business iness premium mium basis is 6 Source: : IRDA DAI, I, Public lic disclo losur sures Components nts may y not add up to the totals als due to rounding ing off off

Share e of ULIPs Ps on th the e rise se 1 Privat ate players rs Indust stry ry 7% 7% 29% 29% 35% 35% 38% 38% 10% 10% 40% 40% 41% 41% 12% 12% 12% 12% 15% 15% 93% 93% 71% 71% 65% 65% 62% 62% 60% 60% 90% 90% 59% 59% 88% 88% 88% 88% 85% 85% FY20 FY 2012 12 FY20 FY 2013 13 FY FY20 2014 14 FY FY20 2015 15 Q1 Q1FY FY201 016 FY FY20 2012 12 FY FY20 2013 13 FY FY20 2014 14 FY20 FY 2015 15 Q1 Q1FY FY201 016 Trad aditi itional al ULI ULIP Trad aditi itional al ULIP UL  Strong rong val alue ue prop ropositi sition of of ULIPs Ps  Transpar sparent nt and low charges es  Lowe ower disconti discontinuous uous char harge ges up upto to yea ear 5 and and ze zero ro sur surrend ender er pen penal alty ty afte ter 5 year ars  Choice ce of of asse set allocatio cation to to match ch risk sk appet etite te of of diffe ferent custome omer 1. New business iness premi mium um basis is 7 Source: : IRDA DAI, I, Life insuranc urance counc ncil il

Agend enda Indust stry ry over ervie view w Outlook ok Company any st strategy tegy and per erformanc rmance 8

Fav avourab urable le dem emograph ography y to dri rive ve macr acro o gr growth wth Larg rge and Growing ing Populatio lation Base se 1 High h Share of Workin king Populatio lation 2  Indian an econo nomy my poise sed to head Populat ation on of age 25-60 years s (in mn mn) 2013 013 Population (mn mn) towar ards ds susta tained ined 739 739 691 691 1,350 350 639 639 585 585 growt owth fuelled by 1,238 238 favoura urable ble 316 316 251 251 201 201 demo mogr grap aphics, hics, 143 143 127 127 rising sing afflue fluence ce 50 50 53 53 South ea Korea South Africa Japan ssia Brazil esia USA India China 201 2015 202 2020 202 2025 2030 203 Indonesi Russ So So Br  Growt owth rate te of Driving ving GDP Growth th 3 Rising sing Affluenc luence 1 total al prem emium um writte ten n by the GDP per 14.4% 4% Capita 9.8% CAGR (200 007- insura uranc nce e indust stry y 8.5% 2017) 017) 6.9% 7.3% 7.5% 7.9% 8.0% 8% 10.1% 1% 9.8% has outpaced ced the 6.6% 7.5% 5% 5.1% 4.9% GDP P growt owth rate te 4.3% 5.4% 4% 3.1% 2.4% 2.5% 2.6% 2.8% 3.3% 3.2% 4% 3.6% 6% 5% 3.4% over er the period d of 1.9% 1% 2.5% 2.1% FY2002 FY 02-FY201 Y2015 -1.7% FY02 FY08 FY10 FY12 FY13 FY14 FY15 FY16 FY17 FY18 Japan USA South ea Korea South Africa Brazil ssia India esia China Indonesi Russ So So Br Ind ndia World 1. 1. Source: : Econo nomist ist Intelli lligenc nce Unit it 9 2. 2. Source: : UN popula latio ion n divisio ision n 2013 3 releas ase 3. 3. Source: : World bank k database abase

Share of Insurance in Savings Expected to Rise Fi Financ ancia ial l savings ings headed ded toward rd a rebound ound Financi ncial l year 2002 02 2008 08 2010 10 2011 11 2012 12 2013 13 2014 14 2015 15 Financi ncial l saving ings / 10.5% 5% 11.6% 6% 12.0% 0% 9.9% 9% 7.3% 3% 7.0% 0% 7.2% 2% 7.6% 6% GDP GDP House usehol hold saving ings / 23.2% 2% 22.4% 4% 25.2% 2% 23.1% 1% 22.8% 8% 20.2% 2% 18.2% 2% 18.1%* 1%* GDP GDP 25 25 20 20 9.59 59 6.43 43 6.94 illion s trillion 8.19 19 15 15 7.74 74 7.75 75 5.71 71 10 10 Rs 5.80 80 13.71 1 4.38 38 13.22 2 13.08 8 12.46 6 5 10.26 6 3.13 13 2.47 47 8.56 56 7.60 60 5.38 38 4.31 31 3.44 44 2.98 98 0 Phy hysic ical al saving avings Fina inanc ncia ial sa l savin ings  India dia has s a high gh househo usehold d savi vings ngs rate te  Part rt of physica hysical l savi vings ngs shifting fting to finan ancial ial savi vings ngs *Co Comp mpany any estim imat ate 10

Sh Shar are e of ins nsur urance ance in n fina nanc ncial ial sav aving ngs s expecte ected to rise se Distribut ribution ion of financ ancial ial assets ets 1 100% 10 0% 80% 80 21.0% 16.0% 17.8% 19.5% 22.0% 19.0% 26.2% 60% 60 14.4% 40 40% 20% 20 0% 0% FY FY20 2002 02 FY FY20 2008 08 FY20 FY 2010 10 FY20 FY 2011 11 FY FY20 2012 12 FY FY20 2013 13 FY FY20 2014 14 FY FY20 2015 15 Currency urrency & & Dep Deposits sits Life ife Insura nsuranc nce Fund e Fund Shares / res / Debent bentures ures / MFS MFS Pro Provid vident ent / / Pe Pension nsion Fun Fund / d / Cla Claims on ims on Govt vt Penet netration ration (Premiu ium / / GDP) 2 Sum Assure sured d as % o of GDP 3 11.4% 4% 270% 270% 260% 300% 300% 260% 226% 226% 250% 250% 8.4% 12% 7.2% 166% 149% 166% 200% 200% 149% 9% 9% 150% 150% 106% 106% 96% 96% 3.6% 3.0% 2.6% 100% 100% 60% 60% 6% 6% 1.7% 1.1% 50% 50% 3% 3% 0% 0% 0% 0% US US apan an pore Korea laysia sia many ny nd iland ia India ingapor Ind frica Japan Korea nd iland US US India ia ina China sia onesia Jap Kor Germa Thaila Mala Ind Kor Singa Thaila S.Afr Ch Ma Th Indon Th Ind 1. 1. Source: : Reserve rve Bank nk of India ia 2. Source: 2. : Swiss ss Re - World ld insur uranc ance in 2014 2014 11 3. 3. Source: : McKinsey Kinsey analysis lysis 2013

Agend enda Indust stry ry over ervie view w Outlook ok Company any st strategy tegy and per erformanc rmance 12