(Reuters) – India’s ICICI Prudential Life Insurance on Tuesday reported a surge in fourth-quarter profit, helped by strong demand for its group insurance offerings.
The insurer’s standalone profit more than doubled to 3.86 billion rupees ($45 million) for the quarter ended March 31. Its quarterly net premium income grew 11% to 16.37 billion rupees, driven by a 30% jump in single premiums.
Demand for its market or unit-linked insurance plans (ULIP) dropped during the fourth quarter as India’s stock markets underwent a sharp correction.
In the previous quarters, demand for ULIPs rose consistently as the stock markets traded at record high levels.
However, analysts pointed out that a rise in the demand for group insurance plans during the January-March quarter has boosted premium income for ICICI Prudential.
Group insurance policies cover multiple people in the same plan and are generally taken by companies to provide coverage for employees.
ICICI Prudential’s value of new business (VNB), or expected profit from new policies, rose 2.5% to 7.95 billion rupees for the quarter, according to Reuters calculations.
However, the insurer’s annualised premium equivalent (APE) sales, which is the total value of all single- and recurring-premium policies, fell 3.1% to 35.02 billion rupees during the quarter due to the drop in the sales of ULIPs.
Meanwhile, ICICI Prudential’s VNB margins for the full year deteriorated to 22.8% from 24.6% a year ago.
ULIPs accounted for 48.3% of the company’s overall product mix, down from 50.8% a year earlier.
Peer HDFC Life will report its quarterly results later this week, while SBI Life Insurance is scheduled to post its earnings next week.
($1 = 85.7230 Indian rupees)
(Reporting by Kashish Tandon in Bengaluru; Editing by Shreya Biswas)
