SBI Life Insurance Q2 net profit stays flat amid rise in expenses

SBI Life Insurance’s net profit remained flat at Rs 380.19 crore in the second quarter of 2023-24 (Q2FY24) as the growth in expenditure outweighed that of premium.

The net profit of the country’s second-largest life insurer inched up by 0.93 per cent in Q2 from Rs 376.7 crore in the year-ago period.

Its net premium income jumped 21.68 per cent to Rs 20,049.66 crore from Rs 16,477.26 crore compared to the corresponding period last year.

However, the expenses increased by 22.07 per cent to Rs 19,121.4 crore from Rs 15,664.1 crore on account of strong growth in the operating expenses.

During the quarter, the insurer’s value of new business (VNB) surged 20.26 per cent to Rs 1,490 crore from Rs 1,239 crore in the first quarter of FY24.

The annualised premium equivalent (APE) grew 33 per cent to Rs 5,230 crore in the July-September quarter from Rs 3,930 crore in the year-ago period.

A key measure of profitability, VNB margin of the company fell to 28.49 per cent from 31.55 per cent across the time period because of product mix. However, the improvement in the product level margin helped in cushioning the drop.  

The insurer’s solvency ratio stood at 212 per cent, against 219 per cent in the year-ago period. The minimum regulatory requirement is 150 per cent.

In the first of FY24, the company maintained its leadership position in individual rated premium of Rs 7,060 crore with 24.6 per cent private market share. While its APE rose by 21 per cent to Rs 8,260 crore, the protection APE segment grew 39 per cent, totaling Rs 1,070 crore.