MUMBAI, 4th JULY, 2022 (GPN): HDFC International Life & Re has secured approval from SEZ authorities at Gift City and has secured in-principle approval from International Financial Services Centres Authority (IFSCA) for setting up a global-in-house centre.

While responding to shareholder’s query at the AGM of the company about plans for the GIFT city initiative, Ms. Vibha Padalkar – MD & CEO, HDFC Life clarified that this office will pool and aggregate all processing activities of HDFC International & Re’s businesses and provide optimisation benefits for current and future businesses.

HDFC LIFE’S Chairman – Mr Deepak S. Parekh’s Speech At The 22nd Annual General Meeting On 27th June 2022: —

STATE OF INDIA’S ECONOMY

We remain optimistic about the resilience of India’s economy despite the high volatility in the global environment. The world’s largest vaccination drive has allowed us to swiftly move beyond the acute phase of the pandemic that was witnessed at the start of the last financial year. We are now
witnessing early signs of a sustainable economic revival. High growth in non-oil & non-gold imports reflects a pickup in domestic demand. Domestic economic activity is fueled by private consumption
and rising discretionary spending.

Furthermore, the forecast for a normal southwest monsoon this year is expected to support rural consumption.
We remain vigilant of the implications from the current geopolitical tensions; elevated commodity prices; slowing external demand; supply disruptions; capital outflows; higher inflation in emerging
economies and the withdrawal of monetary accommodation in developed economies.

LIFE INSURANCE INDUSTRY
Despite the pandemic, the Indian life insurance industry’s new business premium grew by 16% in FY22. The physical distribution channels were severely constrained on account of the lockdown
restrictions during the second wave and to some extent during the third wave of Covid-19. On the other hand, the pandemic amplified the awareness for life and health protection covers amongst a major portion of our society. India’s insurance penetration and density still remain much lower than
the global average, which means with an increase in per capita GDP, there is an immense potential for continued sectoral growth.

HDFC LIFE PERFORMANCE UPDATE
At HDFC Life, we achieved another strong year of business performance whilst successfully balancing growth, profitability and business quality. We maintained our New Business market share of 21% and 7.7% in private and overall life insurance market, respectively. We thus retained our
position as the second largest private life insurer and the third largest on an overall basis. For thefirst two months of the current financial year, we continue to rank amongst the top 3 insurers in India in terms of overall New Business Premium.

In FY22, our Renewal Premium grew by 18% helped by a marked improvement in our 13th month persistency (without single premium) from 84.9% in the previous year to 87.5%. Our focus on product innovation, scale efficiencies and a balanced product mix aided an expansion of 130 bps in
new business margins (NBM) to 27.4%. as a result, the Value of New Business (VNB) grew by over 22% to Rs. 2,675 crore.

During the year, HDFC Life paid protection claims worth Rs. 5,804 crore as against Rs 1,037 crore in FY 2020-21. Despite this significant increase, our commitment to protect our policyholders remained steadfast and we settled 99.6% overall and 98.7% individual death claims.

SUBSIDIARIES UPDATE
Our subsidiaries Exide Life insurance, HDFC Pension and HDFC International Life and Re, have all continued to perform well.
Exide life Insurance’s individual weighted received premium grew at 22% for the financial year and its embedded value was a healthy Rs. 2,910 crore.

HDFC Pension, with a market leading share of 37% was also the fastest growing pension fund manager, with a 73% y-o-y increase in its Assets under Management (AUM) to reach Rs. 284 billion, as of March 31, 2022.
HDFC International Life & Re, has received letter of approval from SEZ authorities at Gift City and has recently received in-principle approval from International Financial Services Centres Authority
(IFSCA) for setting up a global-in-house centre.

OPPORTUNITY
Factors such as low market penetration, favourable demographics and rising awareness amongst consumers regarding the need for insurance, are considerable tailwinds for the industry. Our endeavour is to continue expanding sources of new business and introduce new products whilst
ensuring appropriate risk management and business quality.India’s demographic dividend not only offers a huge opportunity, but also poses a considerable challenge to reach and serve customers across the length and breadth of our country in a cost-
efficient manner. Given this, I have no doubt that technology will be a key enabler for life insurance companies to achieve their aspirations.

The pandemic has caused a fundamental shift in consumer preferences towards the use of technology to engage and transact with service providers. At HDFC life, we have invested in building market leading digital capabilities that put the customer first and provide greater reach, agility and efficiency.

CONSOLIDATION
It is a landmark year in our journey; we announced the first of its kind acquisition in the life insurance industry. The acquisition and subsequent merger of Exide life insurance will bolster our distribution reach, especially in south India. Exide life’s proprietary distribution network will help us access hitherto under-penetrated geographies. Exide life insurance is now a 100% subsidiary of our company and while final approvals should come through in the next couple of months, both teams
are working together to preserve and grow the value of the franchise.

REGULATORY ENABLEMENT
IRDAI has been supportive of the industry’s growth aspirations and has taken a proactive stance in helping facilitate the same. The IRDAI has articulated a reforms agenda, ‘Vision 2047’, aimed at ‘Insurance for All’ by 2047, commemorating 100 years of independence.

We welcome the authority having swiftly constituted 8 working groups that have recently submitted their recommendations. we are hopeful that the vision of the new IRDAI chairman will lead to several structural changes fructifying this year.

For example, as part of the development & penetration working group, we have requested the authority to accept the recommendations in the Health Indemnity Committee report, allowing life
insurers to distribute health indemnity plans. Another suggestion is to move to a risk-based capital framework that would help improve capital efficiency and facilitate better risk management for
insurance companies. The authority has already made a significant relaxation in the form of allowing use & file for select products. These kind of enablement for the industry are expected to support the growth agenda even more firmly going forward.

CONCLUSION
I would like to thank our customers for their trust in us. I would also like to thank our employees, especially frontline employees, without whose commitment we would not be where we are today. I also want to thank our shareholders for their support, and IRDAI for the empowerment that they are providing to the industry. with the combined support of all our stakeholders, I believe that we as a country, industry and as a company will emerge stronger from the current volatility.
**END OF CHAIRMAN’S SPEECH**