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Max Life Insurance, a private life insurer, plans to ramp up investments on cloud and analytics as it goes about taking its digital journey to the next higher trajectory, said a top official.
As part of its aim to become a differentiated player and an innovative digital organisation over the next three years, the company will also create an omni channel-consistent experience for customers by increasing focus on digitisation, Prashant Tripathy, Managing Director & CEO, Max Life Insurance, told BusinessLine .
By an omni channel-consistent experience, Tripathy was referring to the aspect of using digitisation to give customers the same experience irrespective of the channel they choose for their product purchases. “We are reasonably digital. Now, we want to make it more sophisticated, more penetrated, and make it more robust. Cloud penetration for us must go up. The theme of digitisation and innovation is what we want to pursue rapidly,” he said.
Already, about 80 per cent of customer transactions are digital and 100 per cent of in-force policies are digital, he added.
For the just-concluded December quarter, Max Life Insurance had reported a net profit of ₹220 crore, up 43 per cent over the same quarter last fiscal. Gross written premium had recorded 19 per cent growth at ₹4,629 crore.
For the nine months ended December 31, 2020, Max Life’s margins went up to 25.9 per cent from 21 per cent in same period last year. The Value of New Business (VNB) written during the first nine months stood at ₹788 crore, reflecting a 37 per cent increase on a year-on-year basis.
“Our margins have gone up because we made smart changes in product mix. We have increased the share of protection and rebalanced the portfolio, did better underwriting. Throughout the year we maintained consistent pipeline of innovative designs which has helped. We got the tailwind of the market. Protection grew 55 per cent and online channel grew very significantly at 50 per cent. There is a tailwind towards protection that we have managed to leverage because of our strategy,” he added.
Till December-end 2020 this fiscal, Max Life reported a 11 per cent growth on individual adjusted basis. Tripathy said that January, too, was a good month for the company and expects to also ride on the base effect for March.
FDI cap increase
Asked if Max Life Insurance will see some capital structure rejig now that the government has announced a hike in FDI limit in insurance sector from 49 per cent to 74 per cent, Tripathy replied in the negative. “We don’t have any immediate plans. FDI limit increase for insurance sector creates more depth in the market. There is nothing specific on any plans we have. It’s going to be same like we are now following. At a long term basis, Max Financial and Axis Bank will be our shareholders,” he said. He also expressed confidence over getting IRDAI nod by end March for the recent Axis transaction.
ULIP taxation
Asked about the Budget announcement on Unit Linked Insurance Plan (ULIP) taxation, Tripathy said it would have negligible impact in terms of attractiveness of ULIP. “We get nearly 40 per cent of our revenues (sales) from ULIP and the rest from traditional products. The Budget proposal on ULIP taxation will at the most bring it down 2-3 per cent — nothing more than that,” he added.
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