ICICI group ICICI group ICICI group ICICI group –––– insurance insurance insurance insurance businessesbusinessesbusinessesbusinesses
July 2003July 2003July 2003July 2003
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ContentsContentsContentsContents
Indian insurance sector Indian insurance sector Indian insurance sector Indian insurance sector
ICICI Prudential Life InsuranceICICI Prudential Life InsuranceICICI Prudential Life InsuranceICICI Prudential Life InsuranceICICI Prudential Life InsuranceICICI Prudential Life InsuranceICICI Prudential Life InsuranceICICI Prudential Life Insurance
ICICI Lombard General InsuranceICICI Lombard General InsuranceICICI Lombard General InsuranceICICI Lombard General InsuranceICICI Lombard General InsuranceICICI Lombard General InsuranceICICI Lombard General InsuranceICICI Lombard General Insurance
3
The insurance opportunity in IndiaThe insurance opportunity in IndiaThe insurance opportunity in IndiaThe insurance opportunity in India
Source: Swiss Re, Economic Research & Consulting (June 2002)
14.2%14.2%14.2%14.2%
12.1%12.1%12.1%12.1%
9.0%9.0%9.0%9.0%
5.2%5.2%5.2%5.2%
2.9%2.9%2.9%2.9% 2.7%2.7%2.7%2.7% 2.2%2.2%2.2%2.2%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
UnitedKingdom
SouthKorea
UnitedStates
Malaysia Thailand India China
Life insurance General insurance
The Indian insurance sector is under penetrated in both the lifeThe Indian insurance sector is under penetrated in both the lifeThe Indian insurance sector is under penetrated in both the lifeThe Indian insurance sector is under penetrated in both the life & & & & general insurance segmentsgeneral insurance segmentsgeneral insurance segmentsgeneral insurance segments
Premium as a % of GDPPremium as a % of GDPPremium as a % of GDPPremium as a % of GDP
4
95.595.595.595.5 90.590.590.590.5
0.0
25.0
50.0
75.0
100.0
FY02 FY03
Private sector is gaining market share…Private sector is gaining market share…Private sector is gaining market share…Private sector is gaining market share…
Life InsuranceLife InsuranceLife InsuranceLife Insurance NonNonNonNon----Life InsuranceLife InsuranceLife InsuranceLife Insurance
4.5%4.5%4.5%4.5% 9.5%9.5%9.5%9.5%
%%%%
Public sectorPublic sectorPublic sectorPublic sector
Private sectorPrivate sectorPrivate sectorPrivate sector
98.298.298.298.2 92.292.292.292.2
0.0
25.0
50.0
75.0
100.0
FY02 FY03
1.8%1.8%1.8%1.8% 7.8%7.8%7.8%7.8%
%%%%
5
The Indian insurance landscape todayThe Indian insurance landscape todayThe Indian insurance landscape todayThe Indian insurance landscape today
Source: IRDA Journal (July 2003)
With increasing competition in the sector, success would depend With increasing competition in the sector, success would depend With increasing competition in the sector, success would depend With increasing competition in the sector, success would depend on the following key factors…on the following key factors…on the following key factors…on the following key factors…
Private Private Private Private sectorsectorsectorsector
12121212LifeLifeLifeLife
Public Public Public Public sectorsectorsectorsector
1111
TotalTotalTotalTotal
13131313
9999NonNonNonNon----lifelifelifelife 4444 13131313
----ReinsuranceReinsuranceReinsuranceReinsurance 1111 1111
SegmentSegmentSegmentSegment
Number of playersNumber of playersNumber of playersNumber of players
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Key success factorsKey success factorsKey success factorsKey success factors
Experience of sponsorsExperience of sponsorsExperience of sponsorsExperience of sponsorsAccess to capitalAccess to capitalAccess to capitalAccess to capitalStrong brandStrong brandStrong brandStrong brandChannel strengthChannel strengthChannel strengthChannel strength
Speed & quality of reach to customerSpeed & quality of reach to customerSpeed & quality of reach to customerSpeed & quality of reach to customer
Access to customer baseAccess to customer baseAccess to customer baseAccess to customer baseSound risk measurement and management Sound risk measurement and management Sound risk measurement and management Sound risk measurement and management practicespracticespracticespractices
Building an optimal product portfolioBuilding an optimal product portfolioBuilding an optimal product portfolioBuilding an optimal product portfolio
Scale of operationsScale of operationsScale of operationsScale of operationsKey requirement for ensuring operating & cost Key requirement for ensuring operating & cost Key requirement for ensuring operating & cost Key requirement for ensuring operating & cost efficienciesefficienciesefficienciesefficiencies
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ContentsContentsContentsContents
Indian insurance sector Indian insurance sector Indian insurance sector Indian insurance sector Indian insurance sector Indian insurance sector Indian insurance sector Indian insurance sector
ICICI Prudential Life InsuranceICICI Prudential Life InsuranceICICI Prudential Life InsuranceICICI Prudential Life Insurance
ICICI Lombard General InsuranceICICI Lombard General InsuranceICICI Lombard General InsuranceICICI Lombard General InsuranceICICI Lombard General InsuranceICICI Lombard General InsuranceICICI Lombard General InsuranceICICI Lombard General Insurance
8
Joint venture partner Joint venture partner Joint venture partner Joint venture partner –––– Prudential Prudential Prudential Prudential plcplcplcplc
Largest life insurance company in U.K. & a leading Largest life insurance company in U.K. & a leading Largest life insurance company in U.K. & a leading Largest life insurance company in U.K. & a leading player in Asiaplayer in Asiaplayer in Asiaplayer in AsiaPresent in about 15 countries Present in about 15 countries Present in about 15 countries Present in about 15 countries Serves over 12 million customersServes over 12 million customersServes over 12 million customersServes over 12 million customersManages assets of about US$ 250.00 billionManages assets of about US$ 250.00 billionManages assets of about US$ 250.00 billionManages assets of about US$ 250.00 billionHolds 26% stake in ICICI PrudentialHolds 26% stake in ICICI PrudentialHolds 26% stake in ICICI PrudentialHolds 26% stake in ICICI Prudential
9
Share in Pensions (%) in Share in Pensions (%) in Share in Pensions (%) in Share in Pensions (%) in FY2003FY2003FY2003FY2003
23232323
8888
69696969
ICICI Prudential Other Private Players LIC
Market leadershipMarket leadershipMarket leadershipMarket leadershipShare in private life insurance Share in private life insurance Share in private life insurance Share in private life insurance
market (%) in FY2003market (%) in FY2003market (%) in FY2003market (%) in FY2003
39393939
61616161
ICICI Prudential Other Private Players
Over twice the size of the Over twice the size of the Over twice the size of the Over twice the size of the nearest private playernearest private playernearest private playernearest private player
23% share in the overall 23% share in the overall 23% share in the overall 23% share in the overall pensions businesspensions businesspensions businesspensions business
1111
1Excludes group business
10
Product mixProduct mixProduct mixProduct mix1111
Par62%
Linked3%
Non Par8%
Par Pensions27%
FY2002FY2002FY2002FY2002
Higher proportion of linked business enhances capital efficiencyHigher proportion of linked business enhances capital efficiencyHigher proportion of linked business enhances capital efficiencyHigher proportion of linked business enhances capital efficiency
FY2003FY2003FY2003FY2003
Linked27%
Non Par3%
Par Pensions
10%
Par36%
Linked Pensions
24%
1 1 1 1 Annualised Premium Equivalent (APE) basisAnnualised Premium Equivalent (APE) basisAnnualised Premium Equivalent (APE) basisAnnualised Premium Equivalent (APE) basis
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Growth in distributionGrowth in distributionGrowth in distributionGrowth in distribution
Continued focus on expanding reach & penetration for Continued focus on expanding reach & penetration for Continued focus on expanding reach & penetration for Continued focus on expanding reach & penetration for increasing market shareincreasing market shareincreasing market shareincreasing market share
FY2003FY2003FY2003FY2003
25252525LocationsLocationsLocationsLocations
FY2002FY2002FY2002FY2002
13131313
Q1Q1Q1Q1----2004200420042004
29292929
29292929BranchesBranchesBranchesBranches 14141414 41414141
1,9321,9321,9321,932StaffStaffStaffStaff 843843843843 2,4752,4752,4752,475
18,34418,34418,34418,344AgentsAgentsAgentsAgents 9,6419,6419,6419,641 22,06022,06022,06022,060
8888Bancassurance Bancassurance Bancassurance Bancassurance relationshipsrelationshipsrelationshipsrelationships 3333 8888
ParticularsParticularsParticularsParticulars
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Channel mixChannel mixChannel mixChannel mix
FY2003FY2003FY2003FY2003
% of APE% of APE% of APE% of APE
FY2002FY2002FY2002FY2002
72%72%72%72%Tied agencyTied agencyTied agencyTied agency 82%82%82%82%
10%10%10%10%Corporate agencyCorporate agencyCorporate agencyCorporate agency 11%11%11%11%
18%18%18%18%BancassuranceBancassuranceBancassuranceBancassurance 7%7%7%7%
100%100%100%100%TotalTotalTotalTotal 100%100%100%100%
ParticularsParticularsParticularsParticulars
ICICI Bank’s share in bancassurance was about 46% in Q1ICICI Bank’s share in bancassurance was about 46% in Q1ICICI Bank’s share in bancassurance was about 46% in Q1ICICI Bank’s share in bancassurance was about 46% in Q1----2004200420042004
Q1Q1Q1Q1----2004200420042004
79%79%79%79%
7%7%7%7%
14%14%14%14%
100%100%100%100%
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Financial performance in FY2003Financial performance in FY2003Financial performance in FY2003Financial performance in FY2003(Rs. million)
Net premiumNet premiumNet premiumNet premium
Q1Q1Q1Q1----2004200420042004
978.8978.8978.8978.8
PAT/ (Loss)PAT/ (Loss)PAT/ (Loss)PAT/ (Loss) (352.0)(352.0)(352.0)(352.0)
NetworthNetworthNetworthNetworth 1,373.71,373.71,373.71,373.7
NBAPNBAPNBAPNBAP 224.5224.5224.5224.5
ParticularsParticularsParticularsParticulars FY2003FY2003FY2003FY2003
4,176.24,176.24,176.24,176.2
(1,471.8)(1,471.8)(1,471.8)(1,471.8)
1,724.91,724.91,724.91,724.9
714.4714.4714.4714.4
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ContentsContentsContentsContents
Indian insurance sector Indian insurance sector Indian insurance sector Indian insurance sector Indian insurance sector Indian insurance sector Indian insurance sector Indian insurance sector
ICICI Prudential Life InsuranceICICI Prudential Life InsuranceICICI Prudential Life InsuranceICICI Prudential Life InsuranceICICI Prudential Life InsuranceICICI Prudential Life InsuranceICICI Prudential Life InsuranceICICI Prudential Life Insurance
ICICI Lombard General InsuranceICICI Lombard General InsuranceICICI Lombard General InsuranceICICI Lombard General Insurance
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Joint venture partner Joint venture partner Joint venture partner Joint venture partner –––– Lombard CanadaLombard CanadaLombard CanadaLombard Canada
One of the leading nonOne of the leading nonOne of the leading nonOne of the leading non----life insurers in Canadalife insurers in Canadalife insurers in Canadalife insurers in CanadaAsset base in excess of Canadian $1 billionAsset base in excess of Canadian $1 billionAsset base in excess of Canadian $1 billionAsset base in excess of Canadian $1 billionAnnual gross premium in excess of Canadian $750 Annual gross premium in excess of Canadian $750 Annual gross premium in excess of Canadian $750 Annual gross premium in excess of Canadian $750 million million million million Lombard is a subsidiary of FairfaxLombard is a subsidiary of FairfaxLombard is a subsidiary of FairfaxLombard is a subsidiary of Fairfax
Fairfax had total assets of about Canadian $35 billion Fairfax had total assets of about Canadian $35 billion Fairfax had total assets of about Canadian $35 billion Fairfax had total assets of about Canadian $35 billion and gross written premiums of over Canadian $8 and gross written premiums of over Canadian $8 and gross written premiums of over Canadian $8 and gross written premiums of over Canadian $8 billion in FY2002billion in FY2002billion in FY2002billion in FY2002
Holds 26% stake in ICICI LombardHolds 26% stake in ICICI LombardHolds 26% stake in ICICI LombardHolds 26% stake in ICICI Lombard
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Market shareMarket shareMarket shareMarket share
21.721.721.721.7
16.716.716.716.7 16.116.116.116.1
13.813.813.813.8
15.515.515.515.5
16.216.216.216.2
30.330.330.330.3
16.816.816.816.8
5.85.85.85.8
15.315.315.315.3
16.516.516.516.5
15.315.315.315.3
Bajaj Allianz
Tata AIG
ICICI Lombard
Iffco Tokio
Reliance
Others
FY2002 (%)FY2002 (%)FY2002 (%)FY2002 (%) FY2003 (%)FY2003 (%)FY2003 (%)FY2003 (%)
Source: IRDA Journal
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Product mix in FY2003Product mix in FY2003Product mix in FY2003Product mix in FY2003
Public sectorPublic sectorPublic sectorPublic sector
Private sector*Private sector*Private sector*Private sector*
ICICI LombardICICI LombardICICI LombardICICI Lombard
TotalTotalTotalTotal
Fire & Fire & Fire & Fire & EnggEnggEnggEngg....
24.324.324.324.3
34.534.534.534.5
71.871.871.871.8
25.825.825.825.8
MarineMarineMarineMarine
8.78.78.78.7
6.66.66.66.6
4.24.24.24.2
8.48.48.48.4
MotorMotorMotorMotor
38.938.938.938.9
34.034.034.034.0
1.31.31.31.3
38.038.038.038.0
OthersOthersOthersOthers
28.128.128.128.1
24.924.924.924.9
22.722.722.722.7
27.827.827.827.8
TotalTotalTotalTotal
100.0100.0100.0100.0
100.0100.0100.0100.0
100.0100.0100.0100.0
100.0100.0100.0100.0*excludes ICICI Lombard
Focused on profitable segments such as fire & engineeringFocused on profitable segments such as fire & engineeringFocused on profitable segments such as fire & engineeringFocused on profitable segments such as fire & engineeringhaving low loss ratioshaving low loss ratioshaving low loss ratioshaving low loss ratios
Source: IRDA Journal
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ReachReachReachReach
Presence in 38 locationsPresence in 38 locationsPresence in 38 locationsPresence in 38 locations
DelhiDelhiDelhiDelhi
A’badA’badA’badA’badBarodaBarodaBarodaBaroda
MumbaiMumbaiMumbaiMumbai
PunePunePunePune H’badH’badH’badH’bad
B’loreB’loreB’loreB’lore
CoimbatoreCoimbatoreCoimbatoreCoimbatore
KolkataKolkataKolkataKolkata
LudhianaLudhianaLudhianaLudhiana
BhubaneshwarBhubaneshwarBhubaneshwarBhubaneshwarNagpurNagpurNagpurNagpur
JaipurJaipurJaipurJaipur
CochinCochinCochinCochin
ChennaiChennaiChennaiChennai
ChandigarChandigarChandigarChandigarhhhh
IndoreIndoreIndoreIndoreBharucBharucBharucBharuc
hhhhSuratSuratSuratSurat AurangabadAurangabadAurangabadAurangabad
VizagVizagVizagVizag
UdaipurUdaipurUdaipurUdaipurJamshedpurJamshedpurJamshedpurJamshedpur GuwahatiGuwahatiGuwahatiGuwahati
AnandAnandAnandAnand BhopalBhopalBhopalBhopal
PanjimPanjimPanjimPanjim
RaipurRaipurRaipurRaipur
KanpurKanpurKanpurKanpurBhujBhujBhujBhuj
JalandharJalandharJalandharJalandhar
MaduraiMaduraiMaduraiMadurai
LucknoLucknoLucknoLucknowwww
RachiRachiRachiRachi
PatialaPatialaPatialaPatiala
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ReReReRe----insurance & claims settlementinsurance & claims settlementinsurance & claims settlementinsurance & claims settlement
Continued support of reinsurance majors Continued support of reinsurance majors Continued support of reinsurance majors Continued support of reinsurance majors including:including:including:including:
Munich Re (lead) Munich Re (lead) Munich Re (lead) Munich Re (lead) Swiss Re Swiss Re Swiss Re Swiss Re
Highest reinsurance commission income levels Highest reinsurance commission income levels Highest reinsurance commission income levels Highest reinsurance commission income levels amongst private insurers in India amongst private insurers in India amongst private insurers in India amongst private insurers in India TieTieTieTie----up with Cunningham Lindsey, world’s second up with Cunningham Lindsey, world’s second up with Cunningham Lindsey, world’s second up with Cunningham Lindsey, world’s second largest surveyors, for uniform and efficient claims largest surveyors, for uniform and efficient claims largest surveyors, for uniform and efficient claims largest surveyors, for uniform and efficient claims settlement practicessettlement practicessettlement practicessettlement practices
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Financial performance in FY2003Financial performance in FY2003Financial performance in FY2003Financial performance in FY2003
Net premiumNet premiumNet premiumNet premium
Q1Q1Q1Q1----2004200420042004
PAT/ (Loss)PAT/ (Loss)PAT/ (Loss)PAT/ (Loss)
NetworthNetworthNetworthNetworth
ParticularsParticularsParticularsParticulars FY2003FY2003FY2003FY2003
(Rs. million)
141.6141.6141.6141.6
63.963.963.963.9
1,100.51,100.51,100.51,100.5
272.3272.3272.3272.3
33.033.033.033.0
1,036.21,036.21,036.21,036.2
Gross Written PremiumGross Written PremiumGross Written PremiumGross Written Premium 1,261.51,261.51,261.51,261.52,152.12,152.12,152.12,152.1
Underwriting resultUnderwriting resultUnderwriting resultUnderwriting result 11.411.411.411.4(107.1) (107.1) (107.1) (107.1)
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