About the Company

SBI Life Insurance is a joint venture life insurance company between State Bank of India (SBI), the largest state-owned banking and financial services company in India, and BNP Paribas Cardif. BNP Paribas is a French multinational bank and financial services company with global headquarters in Paris. SBI owns 62.1% of the total capital and BNP Paribas Cardif 22% of the capital. Other investors are Value Line Pte. Ltd. and MacRitchie Investments Pte. Ltd., holding 1.95% of the total capital each and remaining 12% with Public.

Q4 2020 Updates

Financial Results & Highlights


Consolidated Financials (In Crs)
Q4FY20 Q4FY19 YoY % Q3FY20 QoQ % FY20 FY19 YoY%
Sales 5675 15601 -63.62% 15779 -64.03% 43843 44261 -0.94%
PBT 522 482 8.30% 395 32.15% 1415 1373 3.06%
PAT 531 458 15.94% 390 36.15% 1422 1327 7.16%


Detailed Results

    1. The company saw an income decline of 64% YoY in Q4 periods. PAT grew 16% YoY in the same period.
    2. This fall in income is mainly due to the impairment in investments due to the recent fall in Indian equity markets.
    3. There was a 17% growth in the Value of New Business (VNP).
    4. IRP (Individual Rated Premium) and APE (Annualized Premium Equivalent) grew 9% & 11% YoY while Total Protection NBP grew by 27% YoY.
    5. The new business premium grew 20% YoY. The new business Margin was at 18.7%.
    6. Total AUM and Net Worth grew 14% and 25% YoY respectively in the year.
    7. Indian Embedded Value grew 17% YoY.
    8. The company maintained a solvency ratio of 195%.
    9. The company increased its private market share based on IRP to 23.2% from 22.3% a year ago.
    10. As of 31st March 2020, the AUM was at Rs 1.41 Lac Cr and had a 79:21 debt to equity mix. 93% of debt investments were in AAA-rated bonds.
    11. The total no of lives insured rose 19% YoY to 6.1 Cr in FY20.
    12. The operating expense to the gross premium ratio declined 40 bps to 5.9%.
    13. Total Cost to gross premium ratio was at 9.9% from 10.5% a year ago.
    14. The company reported improvement in persistency across all time periods with 13-month figures improving to 86.14% vs 85.07% a year ago. 61st-month persistency also improved to 59.9% vs 57.23% a year ago.
    15. The company has now covered more than 8.9 million lives

Investor Conference Call Highlights

  1. ULIP grew 10% YoY with a share of 49% in New Business Premium for the company.
  2. Non-par grew 56% YoY with a share of 44% in New Business Premium.
  3. The Individual Protection business grew 42% YoY and contributes to 5% of individual new business.
  4. Group Protection business grew 22% YoY with credit life business 20% YoY.
  5. The traditional savings business grew 33% YoY.
  6. The bancassurance channel grew premiums by 14% with a share of 60% of total sales.
  7. The total number of CIS was at more than 56000 on March 31, 2020.
  8. Instant insurance through the SBI Yuno App has covered around 1.38 Lac lives in FY20.
  9. The total number of agents was at 1,30,418 at the end of FY20.
  10. The direct corporate aggregators and web channels grew by 60% YoY.
  11. Protection premium through online channels grew 41% YoY.
  12. The AUM for the company is the highest for any private life insurance company in India.
  13. The company has 96% of policies processed digitally and 37% of policies being underwritten digitally.
  14. The individual non-par business will not be a focus area for the company. The management states that the company will moderate this product and the hedging required for this product will determine the extent of how the company will push for this product.
  15. The management expects the first quarter to be muted but it is confident of some amount of growth after Q1FY21. The management is confident of the online channel participation and of the company’s ability to innovate and make new products.
  16. The management expects protection to grow going forward and may outpace the segment growth shown in FY20.
  17. The management has stated that it will concentrate on cost optimization and it is comfortable with the current opex ratios.
  18. The focus area for the coming year for the company will be digital sales.
  19. The company has stressed assets in DHFL only and the company has prepared provisions for this.
  20. The company had reduced its allocation to midcaps in FY20 and it was cautious in investing in equities given the high valuations. This is what helped the company maintain AUM growth according to the management.
  21. The management has admitted that its protection schemes are currently higher than HDFC life but is cheaper than ICICI Prudential. The company will be looking to apply feature expansion into its protection products and will align the rates marginally.
  22. The VNB has improved mainly due to the improved product mix with higher non-par sales.
  23. The management has assured that repricing will take place as interest rates go down and whenever the management sees any requirement for it.
  24. The management feels strongly that the protection business should do well post COVID-19.
  25. The management has stated that the target for policy renewal in the month of April has already been achieved. Although this target was lower than normal to account for the current economic environment, the renewals had exceeded the estimated target.
  26. The management is happy with the current ROP (Return of Premium) levels.
  27. The management has stated that the company sees reinsurance at least 60-70% of the protection products.
  28. The unwind rate currently for the company is at 8.5% and it is expected to go down as benchmark interest rates go down in the future.
  29. The management does not expect protection margins to go down in FY21. The company should also not undergo too big a repricing as well as going forward.
  30. The management has clarified that the company shall keep a single-digit growth for aspirational purposes and it is in no way a guidance given the uncertainty ahead.
  31. The company has had only 200+ branches open post-March 20, 2020.
  32. The management clarified that overall solvency should not be affected too much considering the product mix.

Analyst’s View

SBI Life is one of the front runners in the life insurance industry in India. The company has done well to establish itself as the biggest private insurance company in India in terms of AUM. The company has seen a big drop in investment income due to the fall in the investment portfolio from the fall in Indian equity markets. The focus of the management remains to maintain the company’s excellent cost structure during the upcoming economic down period. It remains to be seen whether the situation ahead unfolds within the company’s expectations or whether we may see more uncertainty arising from COVID-19. Nonetheless, given the company’s market positioning, its emphasis on cautious capital allocation, and the rapid proliferation of the company’s products through digital channels, SBI Life remains one of the most preferred life-insurance companies in the country.



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