|
Report Date : |
17.08.2012 |
IDENTIFICATION DETAILS
|
Name : |
HDFC STANDARD LIFE INSURANCE COMPANY LIMITED |
|
|
|
|
Registered
Office : |
Ramon House, 169, H.T. Parekh Marg, Backbay Reclamation, Backbay Reclamation, Churchgate, Mumbai –
400020, Maharashtra |
|
|
|
|
Country : |
|
|
|
|
|
Financials (as
on) : |
31.03.2011 |
|
|
|
|
Date of
Incorporation : |
14.08.2000 |
|
|
|
|
Com. Reg. No.: |
11-128245 |
|
|
|
|
Capital
Investment / Paid-up Capital : |
Rs.19948.801
Millions |
|
|
|
|
CIN No.: [Company Identification
No.] |
U99999MH2000PLC128245 |
|
|
|
|
TAN No.: [Tax Deduction &
Collection Account No.] |
MUMH05080F |
|
|
|
|
PAN No.: [Permanent Account No.] |
AAACH8755L |
|
|
|
|
Legal Form : |
A Closely held Public Limited Liability Company |
|
|
|
|
Line of Business
: |
Providing Legal and Financial Services and Insurance Services |
|
|
|
|
No. of Employees
: |
13000 Approximately ( In
Corporate Office – 200 and all over Branches) |
RATING & COMMENTS
|
MIRA’s Rating : |
B (38) |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
|
Maximum Credit Limit : |
USD 89000000 |
|
|
|
|
Status : |
Moderate |
|
|
|
|
Payment Behaviour : |
Usually Correct |
|
|
|
|
Litigation : |
Clear |
|
|
|
|
Comments : |
Subject is one of India’s Leading Private Insurance Companies, which
offers insurance solutions to individuals and group. It is a joint venture between Housing Development Finance Corporation
Limited (HDFC), India’s leading housing finance institution and a group
company of Standard Life PLC, UK. It is a well established company having moderate track. Profitability
of the company is under pressure. There appears huge accumulated losses.
However trade relations are reported as fair. Business is active. Payments
are reported to be usually correct and as per commitments. In view of strong promoters, the company can be considered normal for
business dealings at usual trade terms and conditions. |
NOTES:
Any query related to this report can be made
on e-mail: infodept@mirainform.com
while quoting report number, name and date.
RBI DEFAULTERS’ LIST STATUS
Subject’s name is not enlisted as a defaulter in
the publicly available RBI Defaulters’ list.
EPF (Employee Provident Fund) DEFAULTERS’ LIST STATUS
Subject’s name is not enlisted as a defaulter
in the publicly available EPF (Employee Provident Fund) Defaulters’ list as of
31-03-2012.
INFORMATION DECLINED BY
|
Name : |
Mr. Gaurav Purohit |
|
Designation : |
Legal Department |
|
Contact No.: |
91-22-67516682 |
|
Date : |
16.08.2012 |
LOCATIONS
|
Registered Office : |
Ramon House, 169, H.T. Parekh Marg, Backbay Reclamation, Backbay Reclamation, Churchgate, Mumbai –
400020, Maharashtra, India |
|
Tel. No.: |
91-22-67516680/ 67516666 |
|
Fax No.: |
91-22-67517680/ 67516333 |
|
E-Mail : |
|
|
Website : |
|
|
Location : |
Owned |
|
|
|
|
Corporate Office 1: |
2nd Floor, ‘A’ Wing, Trade Star Building, Junction of
Kondivita and M.V. Road, Andheri Kurla Road, Andheri (East), Mumbai – 400059,
Maharashtra, India |
|
Tel. No.: |
91-22-28220055/ 67516666 |
|
Fax No.: |
91-22-28229998/ 26222414 |
|
E-Mail : |
|
|
Website : |
|
|
Location : |
Owned |
|
|
|
|
Corporate Office
2: |
12th and 13th Floor, Lodha Excelus, Apollo Mills
Compound, N. M. Joshi Road, Mahalaxmi, Mumbai – 400011, Maharashtra, India |
|
Tel No.: |
91-22-67516666 |
|
Fax No.: |
91-22-67516333 |
|
E-Mail : |
|
|
Website : |
|
|
|
|
|
Branch Office : |
Located at : ·
·
Kolkata ·
Mumbai ·
·
·
|
DIRECTORS
(AS ON 09.08.2011)
|
Name : |
Mr. Gautam Ramanlal Divan |
|
Designation : |
Director |
|
Address : |
95C, |
|
Date of Birth/Age : |
22.07.1940 |
|
Date of Appointment : |
03.02.2004 |
|
DIN No.: |
00001176 |
|
|
|
|
Name : |
Mr. Ranjan K. Pant |
|
Designation : |
Director |
|
Address : |
1Portion – B, 10-A, Kasturba Gandhi Marg, New Delhi – 110001, India |
|
Date of Birth/Age : |
29.06.1959 |
|
Date of Appointment : |
03.05.2004 |
|
DIN No.: |
00005410 |
|
|
|
|
Name : |
Mrs. Renu Sud Karnad |
|
Designation : |
Director |
|
Address : |
BB 14, Greater Kailash Enclave II, |
|
Date of Birth/Age : |
03.09.1952 |
|
Date of Appointment : |
25.01.2006 |
|
DIN No.: |
00008064 |
|
|
|
|
Name : |
Mr. Keki Minoo Mistry |
|
Designation : |
Director |
|
Address : |
Flat No.0702/703, Hasmukh Mansion, 14 Road, Junction, Khar (West),
Mumbai – 400 054, Maharashtra, India |
|
Date of Birth/Age : |
07.11.1954 |
|
Date of Appointment : |
20.12.2000 |
|
DIN No.: |
00008886 |
|
|
|
|
Name : |
Mr. Deepak Shantilal Parekh |
|
Designation : |
Director |
|
Address : |
9/B Darbhanga Mansion, 12 Carmichael Road, Mumbai – 400026, Maharashtra,
India |
|
Date of Birth/Age : |
18.10.1944 |
|
Date of Appointment : |
17.08.2000 |
|
DIN No.: |
00009078 |
|
|
|
|
Name : |
Mr. |
|
Designation : |
Director |
|
Address : |
602 Neat House, 766, College Galli, Dadar (West), Mumbai – 400 028, |
|
Date of Birth/Age : |
19.08.1955 |
|
Date of Appointment : |
28.04.2005 |
|
DIN No.: |
00062596 |
|
|
|
|
Name : |
Mr. Norman Keith Skeoch |
|
Designation : |
Director |
|
Address : |
|
|
Date of Birth/Age : |
05.11.1956 |
|
Date of Appointment : |
02.11.2005 |
|
DIN No.: |
00165850 |
|
|
|
|
Name : |
Mr. Amitabh Omsingh Chudhary |
|
Designation : |
Managing Director and Chief Executive Officer |
|
Address : |
Flat 4301 , 43rd Floor, Tower III, Electra Planet Godrej,
Near Jacob Circle, Saat Rasta, Mahalaxmi East, Mumbai- 400011, Maharashtra,
India |
|
Date of Birth/Age : |
02.07.1964 |
|
Date of Appointment : |
18.01.2010 |
|
DIN No.: |
00531120 |
|
|
|
|
Name : |
Mr. Alwarthirunagari Kuppuswamy Thiruvenkata |
|
Designation : |
Director |
|
Address : |
181-A, Twin Towers, Prabhadevi, Mumbai-400025, Maharashtra, India |
|
Date of Birth/Age : |
16.12.1936 |
|
Date of Appointment : |
05.08.2010 |
|
DIN No.: |
00746153 |
|
|
|
|
Name : |
Mr. Gerald Edgar Grimstone |
|
Designation : |
Alternate Director |
|
Address : |
34, |
|
Date of Birth/Age : |
27.08.1949 |
|
Date of Appointment : |
10.02.2010 |
|
DIN No.: |
01910890 |
|
|
|
|
Name : |
Mr. Michael Gerald Connarty |
|
Designation : |
Director |
|
Address: |
3 Joppa Road, Edinburgh- EH152HA, Unted Kingdom |
|
Date of Birth/ Age: |
18.11.1955 |
|
Date of Appointment: |
12.08.2009 |
|
DIN No.: |
01960618 |
|
|
|
|
Name : |
Mr. Paresh Shreesh Parasnis |
|
Designation : |
Executive Director and Chief Operating Officer |
|
Address : |
Plot No.166-B, Khareghat Road, Hindu Colony, Dadar, Mumbai – 400014, Maharashtra,
India |
|
Date of Birth/Age : |
11.10.1961 |
|
Date of Appointment : |
14.11.2008 |
|
E-Mail : |
|
|
DIN No.: |
02412035 |
|
|
|
|
Name : |
Mr. Nathan Richard Parnaby |
|
Designation : |
Director |
|
Address : |
2 Barton Loan, Edinburgh EH46JQ, United Kingdom |
|
Date of Birth/Age : |
21.09.1958 |
|
Date of Appointment : |
05.08.2010 |
|
DIN No.: |
02901942 |
|
|
|
|
Name : |
Mr. David Thomas Nish |
|
Designation : |
Director |
|
Address : |
Kiloran, Houseton Road, Kilmalcolm PA134NY, United Kingdom |
|
Date of Birth/Age : |
05.05.1960 |
|
Date of Appointment : |
05.08.2010 |
|
DIN No.: |
02912150 |
KEY EXECUTIVES
|
Name : |
Mr. V. Prakash |
|
Designation : |
Account Manager |
|
|
|
|
Name : |
Mr. Atul Gopalkrishna Juvle |
|
Designation : |
Secretary |
|
Address : |
C-209, Omshradha CHS Limited, Jayaraj Nagar, Borivali West, Mumbai – 400091,
Maharashtra, India |
|
Date of Birth/Age : |
24.09.1963 |
|
Date of Appointment : |
11.12.2010 |
|
PAN No.: |
AAJPJ5117A |
|
|
|
|
Name : |
Mr. Gaurav Purohit |
|
Designation : |
Legal Department |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
(AS ON 31.03.2011)
|
Names of Shareholders |
No. of Shares |
% of Holding |
|
Promoters |
|
|
|
-
Indian/Holding Company |
1443733842 |
72.37% |
|
-
Foreign |
518668824 |
26.00% |
|
Others-Domestic |
32477430 |
1.63% |
|
|
|
|
|
Total |
1994880096 |
100.00% |
(AS ON 30.09.2011)
Equity Shares Break – up
|
Category |
|
Percentage |
|
|
|
|
|
Foreign Holding (Foreign institutional investor(s), Foreign
companie(s) Foreign financial institution(s), Non-resident Indian(s) or
Overseas corporate bodies or others) |
|
26.00 |
|
Bodies Corporate |
|
72.37 |
|
Directors or relatives of directors |
|
0.13 |
|
Other top fifty (50) shareholders (other than listed above) |
|
0.21 |
|
Others |
|
1.29 |
|
|
|
|
|
Total |
|
100.00 |
BUSINESS DETAILS
|
Line of Business : |
Providing Legal and Financial Services and Insurance Services |
|
|
|
|
Products : |
Life Insurance |
GENERAL INFORMATION
|
No. of Employees : |
13000 Approximately ( In
Corporate Office – 200 and all over Branches) |
|
|
|
|
Bankers : |
·
HDFC Bank Limited ·
Bank of Baroda ·
Union Bank of India ·
State Bank of India ·
Indian Bank ·
The Saraswat Co-op Bank Limited ·
Federal Bank ·
State Bank of Travancore ·
Central Bank of ·
Indian Overseas Bank ·
South Indian Bank |
|
|
|
|
Banking
Relations : |
-- |
|
|
|
|
Auditors : |
|
|
Name 1: |
S B Billimoria and Company Chartered Accountant |
|
Address : |
12, |
|
PAN No.: |
AAAFS7376P |
|
|
|
|
Name 2: |
Kalyaniwalla and Mistry Chartered Accountant |
|
Address : |
Kalpataru Heritage, 127, Mahatma Gandhi Road, Mumbai – 400001,
Maharashtra, India |
|
Pan No.: |
AAAFK7554R |
|
|
|
|
Holding Company : |
Housing Development Finance Corporation Limited CIN No: L70100MH1977PLC019916 |
|
|
|
|
Investing Company: |
·
Standard Life Assurance Company ·
Standard Life ( |
|
|
|
|
Fellow Subsidiaries : |
·
HDFC Assets Management Company Limited ·
HDFC Developers Limited ·
HDFC Holdings Limited ·
HDC Trustee Company Limited ·
HDFC Realty Limited ·
HDFC Investments Limited ·
HDFC ERGO General Insurance Company Limited ·
GRUH Finance Limited ·
HDFC Sales Private Limited ·
HDFC Venture Capital Limited ·
HDFC Venture Trustee Company Limited ·
HDFC Property Ventures Limited ·
HDFC IT Corridor Fund ·
HDFC Investment Trust ·
Credila Financial Services Private Limited ·
HDFC Asset Management Company ( ·
Griha Investments (Subsidiary of HDFC Holdings
Limited) |
CAPITAL STRUCTURE
(AS ON 31.03.2011)
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
3000000000 |
Equity Shares |
Rs.10/- each |
Rs.30000.000 Millions |
|
|
|
|
|
Issued, Subscribed & Called-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
|
|
|
|
|
1994880096 |
Equity Shares |
Rs.10/- each |
Rs.19948.801
Millions |
|
|
|
|
|
NOTE:
Share Capital amounting to Rs.14437.338
Millions (Previous year Rs.14280.560 Millions) is held by Housing development Corporation
Limited, the holding company.
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
SHAREHOLDERS FUNDS |
|
|
|
|
1] Share Capital |
19948.801 |
19680.000 |
17958.180 |
|
2] Share Application Money Received pending allotment of shares |
-- |
-- |
-- |
|
3] Reserves & Surplus |
2206.790 |
552.892 |
552.892 |
|
4] Credit /[Debit] Fair Value Change Account |
(0.350) |
184.435 |
(77.610) |
|
Sub-Total |
22155.241 |
20417.327 |
18433.462 |
|
|
|
|
|
|
BORROWINGS |
|
|
|
|
POLICYHOLDERS’ FUNDS: |
|
|
|
|
Credit /[Debit] Fair Value Change Account |
(15.447) |
205.087 |
(296.885) |
|
Policy Liabilities |
51233.325 |
37666.908 |
29092.419 |
|
Insurance Reserves |
-- |
-- |
--- |
|
Provision for Linked Liabilities |
183502.921 |
127701.636 |
84085.083 |
|
Add: fair value change |
21728.415 |
27516.164 |
(15302.147) |
|
Total Provision for Linked Liabilities |
205231.336 |
155217.800 |
68782.936 |
|
|
|
|
|
|
Sub-Total |
256449.214 |
193889.795 |
97578.470 |
|
|
|
|
|
|
Funds for Future Appropriations |
1917.148 |
1490.013 |
586.395 |
|
Funds for future appropriation – Provision for lapsed policies
unlikely to be revived |
2555.106 |
1064.831 |
531.970 |
|
|
|
|
|
|
TOTAL |
283076.709 |
216061.966 |
117130.297 |
|
|
|
|
|
|
APPLICATION OF
FUNDS |
|
|
|
|
INVESTMENTS |
6999.708 |
6304.757 |
4291.597 |
|
Shareholders |
53349.840 |
43415.382 |
30050.097 |
|
Policyholders |
205231.336 |
155217.800 |
68782.936 |
|
Assets held to cover Linked Liabilities |
331.239 |
40.366 |
30.248 |
|
LOANS |
2395.729 |
1143.777 |
1447.706 |
|
FIXED ASSETS |
|
|
|
|
Cash and Bank Balance |
3837.312 |
3030.176 |
4108.660 |
|
Advances and Other Assets |
6770.283 |
4917.758 |
5534.969 |
|
|
|
|
|
|
Sub-Total (A) |
10607.595 |
7947.934 |
9643.629 |
|
|
|
|
|
|
SUNDRY CREDITORS |
5163.157 |
4836.270 |
3894.536 |
|
OTHER CURRENT LIABILITIES |
7874.393 |
7649.129 |
4925.689 |
|
PROVISIONS |
150.102 |
187.617 |
208.813 |
|
Sub-Total (B) |
13187.652 |
12673.016 |
9029.038 |
|
|
|
|
|
|
NET CURRENT
ASSETS (C) = (A-B) |
(2580.057) |
(4725.082) |
614.591 |
|
|
|
|
|
|
DEBIT BALANCE IN PROFIT AND LOSS ACCOUNT [Shareholders account] |
15654.987 |
14664.966 |
11913.122 |
|
Deficit in the report |
1693.927 |
-- |
-- |
|
|
|
|
|
|
TOTAL |
283076.709 |
216061.966 |
117130.297 |
PROFIT & LOSS
ACCOUNT
|
PARTICULARS |
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
|
|
|
|
|
Amounts Transferred from The Policyholders Account (Technical Account) |
446.326 |
472.930 |
794.984 |
|
Income from Investments |
|
|
|
|
a) Interest, Dividends and Rent – Gross |
399.900 |
289.102 |
302.367 |
|
b) Profit on sale/ redemption of investments |
183.531 |
49.152 |
13.924 |
|
c) (Loss on sale / redemption of investments) |
(1.697) |
(0.487) |
(35.870) |
|
d) Transfer/ Gain on revaluation/ change in fair value |
-- |
-- |
51.887 |
|
e) Amortisation of (premium)/discount on investments |
(3.042) |
(2.634) |
(2.965) |
|
|
|
|
|
|
Sub Total |
578.692 |
335.133 |
329.343 |
|
Other Income |
0.029 |
3.522 |
0.300 |
|
|
|
|
|
|
TOTAL (A) |
1025.047 |
811.585 |
1124.627 |
|
|
|
|
|
|
Expenses other than those directly related
to the insurance business Bad debts written off |
9.412 |
3.981 |
5.307 |
|
Contribution to the Policyholders Fund |
2005.656 |
3559.448 |
6148.951 |
|
|
|
|
|
|
TOTAL (B) |
2015.068 |
3563.429 |
6154.258 |
|
|
|
|
|
|
Profit/(Loss) Before Tax |
(990.021) |
(2751.844) |
(5029.631) |
|
Provision for Taxation |
-- |
-- |
-- |
|
Profit/(Loss) After Tax |
(990.021) |
(2751.844) |
(5029.631) |
|
|
|
|
|
|
APPROPRIATIONS |
|
|
|
|
Balance at the beginning of the year |
(14664.966) |
(11913.122) |
(6883.491) |
|
Interim Dividends Paid during the year |
-- |
-- |
-- |
|
Proposed Final Dividend |
-- |
-- |
-- |
|
Dividend Distribution Tax |
-- |
-- |
-- |
|
|
|
|
|
|
Profit / Loss carried forward to the balance
sheet |
(15654.987) |
(14664.966) |
(11913.122) |
|
|
|
|
|
|
Earning per share Basic/ Diluted |
(0.50) |
(1.51) |
(3.28) |
LOCAL AGENCY FURTHER INFORMATION
SUNDRY CREDITORS
DETAILS:
|
Particulars |
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
|
(Rs. In Millions) |
||
|
|
|
|
|
|
Sundry Creditors |
5163.157 |
4836.270 |
3894.536 |
|
|
|
|
|
|
Total |
5163.157 |
4836.270 |
3894.536 |
|
Sr. No. |
Check List by Info Agents |
Available in Report (Yes / No) |
|
1] |
Year of Establishment |
Yes |
|
2] |
Locality of the firm |
Yes |
|
3] |
Constitutions of the firm |
Yes |
|
4] |
Premises details |
No |
|
5] |
Type of Business |
Yes |
|
6] |
Line of Business |
Yes |
|
7] |
Promoter's background |
Yes |
|
8] |
No. of employees |
Yes |
|
9] |
Name of person contacted |
Yes |
|
10] |
Designation of contact person |
Yes |
|
11] |
Turnover of firm for last three years |
Yes |
|
12] |
Profitability for last three years |
Yes |
|
13] |
Reasons for variation <> 20% |
-- |
|
14] |
Estimation for coming financial year |
No |
|
15] |
Capital in the business |
Yes |
|
16] |
Details of sister concerns |
Yes |
|
17] |
Major suppliers |
No |
|
18] |
Major customers |
No |
|
19] |
Payments terms |
No |
|
20] |
Export / Import details (if applicable) |
No |
|
21] |
Market information |
-- |
|
22] |
Litigations that the firm / promoter involved in |
-- |
|
23] |
Banking Details |
Yes |
|
24] |
Banking facility details |
Yes |
|
25] |
Conduct of the banking account |
-- |
|
26] |
Buyer visit details |
-- |
|
27] |
Financials, if provided |
Yes |
|
28] |
Incorporation details, if applicable |
Yes |
|
29] |
Last accounts filed at ROC |
Yes |
|
30] |
Major Shareholders, if available |
Yes |
|
31] |
Date of Birth of Proprietor/Partner/Director, if available |
Yes |
|
32] |
PAN of Proprietor/Partner/Director, if available |
No |
|
33] |
Voter ID No of Proprietor/Partner/Director, if available |
No |
|
34] |
External Agency Rating, if available |
No |
BUSINESS
PERFORMANCE HIGHLIGHTS
FY10-11 saw significant regulatory changes that impacted the
availability of products, the economics of distribution channels and the customer
disposition towards the insurance sector. These structural changes that were
focused on long term customer interests would improve the health of the
industry in future, the speed of the implementation of these changes, however,
did impact the new business premium collections for the industry. The industry
(including LIC) witnessed a degrowth of almost 20% on individual new business
(weighted received premium) in the second half (Oct 10—Mar11) of this financial
year.
Despite the dynamic external environment, the Company saw strong growth in new business premium and renewal premium during the FY 10-11.The first year premium income grew by 21% (over FY 09-10) to Rs.40590.000 Millions and renewal premium collected grew by 36% (over FY 09-10) to Rs.49450.000 Millions. The strong performance in the renewal collections helped the company improve its conservation ratio of individual business to 81% from 72% in the previous year. Total premium (including Group business) registered a 29% growth to Rs.90040.000 Millions during the current year. The sum assured in force for the overall business at the end of the current year stood at Rs.989170.000 as compared to Rs.726100.000 Millions for the previous year.
The Company was ranked #1 amongst private life insurers on individual new business (weighted received premium) during the second half of the year. On a full year basis, the company increased its market share (weighted received premium of individual business) in private life insurance space to 13% from 9% in the previous year. This was the largest market share gain among the top 10 private insurers (on new business premium) over the previous year.
The Company continued its focus on improving operational efficiencies and cost containment. Operating expense ratio (total expenses excluding service tax to total premium) reduced from 20% in 2009-10 to 16% in 2010-11. The company launched a raft of efficiency enhancement initiatives that included tightening span of control, automation, vendor consolidation and stronger alignment of performance with incentives.
The annual losses as per Indian GAAP reduced from Rs.2750.000 Millions in 2009-10 to Rs.990.000 Millions in 2010-11.
During the year the Company continued with its ongoing efforts on customer service and building awareness about insurance, There were industry leading initiatives that were carried out on providing multiple payment options to customers, offering a 30 day free look-in period instead of the mandated 15 day period, need based selling, coaching amongst the sales force and welcome calling to every new policy holder to ensure there are no expectations mismatch at the time of buying a policy. The Underwriting and Claims Management practices were rated best-in-class in a benchmarking survey done by Swiss Re during the year.
The Company undertook a revamp of its visual identity based on market research to make it more appealing and relevant to the target demographics. The new visual identity that positioned the company as ’HDFC Life’ was launched along with the 10th year anniversary celebration during the year. The new identity has been well received by all the key stakeholders.
The Company also received significant recognition and accolades during the year for its people practices, brand promise, quality and process maturity and enabling technology.
NEW BUSINESS
The Company issued over 8.3 lac policies (including policies sold in
rural areas) amounting to Rs.40593.000 Millions of new business regular premium
during the financial year. The Group business received Rs.5910.000 Millions of
premiums during the year.
During the year, IRDA introduced new guidelines regarding ULIP products
to be followed by all life insurers, effective September 1, 2010. These
guidelines made the industry review and revamp existing products, distribution
channels and cost models. The guidelines on Group ULIP led to almost 3 months
of no group product being available for customers.
An entire range of new individual ULIP products had to be launched since
September 1, 2010 that impacted the growth momentum of the life insurance
industry. Pressures on channel cost, low commission payout to advisors and the
absence of a viable regular premium pension product led to the private
insurance industry showing a negative growth of4l % in weighted received
premium (WRP) terms in the second half of FY11 and ended the year with a
degrowth of 20% over the previous year.
The company was able to navigate through the change in business
environment and emerged as the leader among private players in individual new
business weighted received premium terms in H2’ FY11 .This was achieved through
a well thought out product launch schedule, speed in embracing the new regime
within operations, sales and training teams, focused efforts on strengthening
new channels and delivering the right advice and service to the customers.
The long term story for life insurance in India stays strong. The
industry is on track to adjust to the ‘new normal The company plans to build on
its solid performance in FY 10-11 and outperform the industry growth in the
next year.
INDIVIDUAL RENEWAL
BUSINESS
The company’s efforts on persistency management helped it achieve a conservation ratio of 81% and a growth of 36% in renewal premium. This was achieved through a dedicated Persistency ‘vertical’ that analysed customer disposition, delivered timely communication to customer through different media and proactively supported the customers to move into self payment modes. The vertical plans to pioneer innovative practices in FY 11-12 on midterm benefit illustrations, advanced analytics to spot trends and last mile engagement of customers to maintain the high levels of conservation ratio.
DISTRIBUTION
Offices:
During the year, the Company focused on containing the operating costs of all its offices. As a part of this exercise the Company carried out a Lean Branch initiative that reduced the total rented area and the overhead costs associated with the branches. This lean branch model will be used for all relocation and future expansion. The Company has also reworked its branch closing and opening process and the new process will ensure the policyholders, financial consultants and employees attached to the respective branch are kept informed and that there is no impact on the continuity in customer service. The Company has ensured that all of the above is done within guidelines set by the regulator.
The Company currently has 498 offices across the country and through the network of these offices the company’s financial consultants, corporate agents and brokers are able to service customers in over approximately 700 cities and towns across the country.
Financial
Consultants:
The Company’s distribution strategy continues to lay emphasis on the development of the tied agency channel. The Company is currently implementing a large scale transformation programme called Manthan to dramatically improve the productivity, customer focus and the effectiveness of the channel.
The Company had around 1,38,000 Financial Consultants as of March 31,2011. The Company provides extensive and thorough training to them to ensure they correctly assess the customer’s needs and offer the right advice relevant to them.
As an ongoing process, the front line sales and Financial Consultants of HDFC Life are being trained on a specialized ‘need based selling approach’ called EDGE. The focus of all communication to the distribution partners and customers is on maximizing long term value by staying invested in the contract. The company has also launched an online learning portal “GOAL” and conducts assessments through the same. This initiative has improved the conservation ratio of policy premiums.
The company has introduced an all round Sales Management Process, called “Sates Activity Manager (SAM)” to measure and monitor productivity of sales staff supporting channel sales. It helps to track prospects better, improves conversion rate and helps in monitoring and enhancing the productivity expectations from the field staff. SAM helps the sales force in aligning their daily activities with the achievement of organization objectives and brings a discipline and rigor in 5elling process that will help the channel.
Corporate Agent:
The Company continued its strong association with its banc assurance partners including HDFC Bank, Indian Bank, Saraswat Bank, HDFC Limited, HDB Financial Services Limited and HDFC Securities Limited. The banc assurance channel has contributed handsomely to the growth of the Company during 2010-11. The Company is in process of further expanding its reach in the banc assurance channel by exploring arrangements to bring in new partners.
The company has also started to forge relationships with leading insurance brokers. It has also invested in direct and loyalty channels during the course of the year.
The company would continue to focus on fortifying its existing relationships and diversify its channel mix by investing in new channels and relationships.
Rural and Social Sector
Obligations
As against the regulatory requirement, they have met the 20% rural target. During the current financial year, the company has covered 99,335 lives under the social category.
Investments
Investments of insurance companies are regulated under the IRDA (Investment) Regulations, 2000 as amended from time to time. The total assets under management (AUM) as on March 31,2011 were Rs.271770.000 Millions. These include assets of Rs.203230.000 Millions under the unit linked products and Rs.61750.000 Millions under the conventional products and shareholder funds. The corresponding numbers for last year were Rs.156610.000 Millions and Rs.51060.000 Millions.
The total equity AUM being managed by the Company as of March 31, 2011 is Rs.143160.000 Millions. Under the unit linked products, the Company offers a series of funds ranging from pure equity to money market funds, thus providing policyholders the flexibility to choose the asset allocation as per their requirements.
Bonus
The Company declared the following reversionary (RB) and interim bonus (IB) rates for the with-profits policies.
CONTINGENT
LIABILITIES:
|
Particulars |
31.03.2011 Rs. in Millions |
31.03.2010 Rs. in Millions |
|
|
|
|
|
Claims other than against policies, not acknowledged as debts by the company |
4.838 |
6.370 |
|
Statutory demands and liabilities in dispute, not provided for |
7001.010 |
2990.733 |
|
|
|
|
FIXED ASSETS:
· Land – Freehold
· Leasehold Improvement
· Building
· Furniture and Fittings
· Information Technology Equipment
· Vehicles
· Office Equipment
· Computer Software
CMT REPORT (Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources including
but not limited to: The Courts,
1] INFORMATION ON
DESIGNATED PARTY
No exist designating subject or any of its beneficial owners,
controlling shareholders or senior officers as terrorist or terrorist organization
or whom notice had been received that all financial transactions involving
their assets have been blocked or convicted, found guilty or against whom a
judgement or order had been entered in a proceedings for violating
money-laundering, anti-corruption or bribery or international economic or
anti-terrorism sanction laws or whose assets were seized, blocked, frozen or
ordered forfeited for violation of money laundering or international
anti-terrorism laws.
2] Court Declaration :
No records exist to suggest that subject is
or was the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper
payments to government officials for engaging in prohibited transactions or
with designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records on Int’l
Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No
available information exist that suggest that subject or any of its principals
have been formally charged or convicted by a competent governmental authority
for any financial crime or under any formal investigation by a competent government
authority for any violation of anti-corruption laws or international anti-money
laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
Our market
survey revealed that the amount of compensation sought by the subject is fair
and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on
Corporate Governance to identify management and governance. These factors often
have been predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws,
regulations or policies that prohibit, restrict or otherwise affect the terms and
conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.55.99 |
|
|
1 |
Rs.87.55 |
|
Euro |
1 |
Rs.68.69 |
INFORMATION DETAILS
|
Information Gathered
by : |
SVA |
|
|
|
|
Report Prepared
by : |
VRN |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
5 |
|
PAID-UP CAPITAL |
1~10 |
5 |
|
OPERATING SCALE |
1~10 |
4 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
5 |
|
--PROFITABILIRY |
1~10 |
3 |
|
--LIQUIDITY |
1~10 |
4 |
|
--LEVERAGE |
1~10 |
4 |
|
--RESERVES |
1~10 |
4 |
|
--CREDIT LINES |
1~10 |
4 |
|
--MARGINS |
-5~5 |
-- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
NO |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
NO |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
NO |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
38 |
This score serves as a reference to assess SC’s credit risk
and to set the amount of credit to be extended. It is calculated from a composite
of weighted scores obtained from each of the major sections of this report. The
assessed factors and their relative weights (as indicated through %) are as
follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)
RATING EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest capability
for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
- |
NB |
New Business |
- |
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.