SBILIFE — earnings call

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Prepared remarks

Moderator · Conference Operator

Ladies and gentlemen, good day, and welcome to the SBI Life Insurance

Ladies and gentlemen, we will now begin the question and answer session.

The first question comes from the line of Avinash Singh from Emkay Global.

Avinash Singh

A couple of questions.

The first one is on margin front; it's a commendable performance.

But my question is that, I mean, given that now you sort of have been focusing to move more or grow more outside the bank as well.

And that's where I mean, agency expansion and opening of branches has been planned.

So , I mean, this opex assumption in this margin calculation.

Keeping that in mind, I mean, whatever your branch expansion and agency addition for kind of plans you have.

So if you were to kind of accelerate those branch opening this year, will that have some kind of any changes in your operating expense assumption or the current margin calculation keeping sort of that part of assumption?

And second piece, again, related to agency only.

Agency has been kind of a focus area, and I mean, you have a strong track record of your agency being SBI Life Insurance Company Limited July 24, 2025 productive.

But if we look at this point in time, the growth in agency looks weak.

So I mean, is there something, I mean, not clicking or is it unexpected lines, if at all by when we can expect a turnaround or other acceleration agency growth?

Moderator · Conference Operator

We take the next question from the line of Nischint Chawathe from Kotak.

Nischint Chawathe

Just a couple of questions.

One was, again, if you could just remind us about your growth kind of target for the year.

I believe you had in the past mentioned that you look at the agency to grow in kind of mid-teen levels.

And is that kind of any change over there?

And any specific cohort or segment of agency that has seen slow down?

Moderator · Conference Operator

The next question comes from the line of Aditi Joshi from JP Morgan.

Aditi Joshi

Just a couple of questions on the product mix within the channel.

So there is quite a varying growth in the particular product.

For example, non-par in the banca was weak, whereas it was strong in the agency.

And similarly, there was some differential within the ULIP sales as well, which was strong in the banca, but weaker on the agency.

So if you can just help us understand that what is causing this variance or differential in the mix across the products, it will be helpful.

And second question is on there has been some news on the new Chairman appointment by the regulators.

So if you can just comment on, what policy expectations will you have from the new Chairman?

And what is the outlook or your view on those?

That would be helpful.

SBI Life Insurance Company Limited July 24, 2025

Moderator · Conference Operator

The next question comes from the line of Nidhesh Jain from Investec.

Nidhesh Jain

Sir, first question is on protection growth.

If you look at the monthly disclosure, our individual sum assured growth was upwards of 70%, but retail protection grew 7% Y-o-Y in APE terms.

So what explains this difference?

Moderator · Conference Operator

The next question comes from the line of Swarnabh Mukherjee from B&K Securities.

Swarnabha Mukherjee

Congrats on strong margin.

I just first wanted to understand from the growth point of view.

So if you could help us understand that in terms of the individual business, I mean in the month of June, we saw a sharp improvement in growth.

So which channels and products are contributing for the same?

Because just wondering that if it is led by, say, for example, retail protection because ticket sizes are lower there, would that be so needle moving in terms of growth?

So if you could give us a broad sense how June growth was or maybe also some comments on July that from which channels and what product mix is driving the same?

And given that keeping the June growth in perspective, could we expect any upward revision to the guidance in terms of growth for the year, which you had previously given?

So that is the first question, sir.

Second is, I mean, I'm estimating that our Group Term Life growth is even much stronger than the Credit Life growth.

Just wanted to understand about the pricing environment in Group Term Life.

Has it improved significantly compared to what it was maybe a few months back.

So if you could comment on the same?

And thirdly, sir, in terms of the 49-month persistency, if you could highlight what kind of impact in that number?

Yes, sir, these will be my questions.

Moderator · Conference Operator

The next question comes from the line of Dipanjan Ghosh from Citigroup.

Dipanjan Ghosh

So just a few questions from my side.

First, in terms of the agency, despite a shift in business mix towards more of par and non-par, the agency activation rates are up Y-o-Y.

So just wanted to get some sense in case the market environment improves, and let's say, the ULIP kind of picks up, what sort of agent activity rates improvement are you really factoring in, in your overall growth estimate for the year?

Second, in terms of your overall commentary at the start of the call where you mentioned that there were green shoots towards the end of the quarter in your guaranteed return products and in terms of the overall business also.

I mean, are you seeing similar trends playing out, let's say, even in July?

And I mean how is the feet on street clearly kind of giving their response to it?

And last question is on the entire kind of journey of ULIP margins across the industry, we have seen pick up in the ULIP margin profile.

In terms of your positioning out there, how much more scope do you see in terms of improving the margin profile across each of the product segments and more specifically ULIP?

Moderator · Conference Operator

We take the next question from the line of Shreya Shivani from CLSA.

Shreya Shivani

I just have one question.

It's on the growth guidance for the year.

So at the end of fourth quarter last year, you had mentioned that individual APE growth of about 13%, 14%, driven by 25% growth from agency channel, 10% from banca channel.

Now unlike the past 6 months, when the commentary in the media about the PSU bank sales of insurance was very negative.

In the last 1 month, there have been a few media articles which suggested that government is telling the PSU banks to focus on selling insurance products, along with core banking operations as well.

So with that in the background, would we be revising our guidance upward?

Is there any different outlook you're getting from your banca partner?

Any commentary on that?

And whether the growth guidance, you're still sticking to the same growth guidance or you're looking at a different number that will be useful, particularly for the banca channel.

Moderator · Conference Operator

The next question comes from the line of Prayesh Jain from Motilal Oswal Financial Services Limited.

Prayesh Jain

Just a couple of questions.

Firstly, just asking that point on the growth in the month of June and so prior to June, the banca channel for us had been growing at a much slower rate.

And I think you alluded to the fact that in June the banca growth has come back.

What changed in the month of June that kind of allowed you to grow at a faster pace versus what was reported in the earlier months, right?

That was my first question.

Second is on the cost front, where we have seen some increase in cost ratio from 6.1% to 6.3%.

Is it just because of the opening of new branches and we should see this coming down going ahead?

Or it should remain elevated at these levels?

Those are my 2 questions.

Moderator · Conference Operator

The next question comes from the line of Mohit Mangal from Centrum Broking.

Mohit Mangal

Congratulations on a good set of VNB margin numbers.

My first is that you said that the growth basically in the protection business was primarily from the lumpy group business.

But if I look at retail protection, I just wanted to understand 2 things.

The 12% growth, I mean, how are we going to increase that?

That's point number one.

Point number 2, the growth in the retail protection is in Tier 1 or basically in Tier 2 and Tier 3 cities.

If you could show some kind of a colour on that, that would be helpful.

Moderator · Conference Operator

The next question comes from the line of Supratim Datta from Ambit Capital.

Supratim Datta

My first question is on the agency side.

So we have created a highly productive agency, and the recruitment numbers have also been fairly strong.

But what we're seeing is the peers have also getting more aggressive on agency, both in terms of recruitment and expansion, particularly in Tier 2 and Tier 3 cities.

So I wanted to understand what are you seeing from the field with respect to competition when it comes to recruitment or commissions that you have to provide?

Are you seeing any changes there?

If you could throw some colour on that, that would be helpful.

And my second question is, there has been rumours, media articles around extending free-look period from 1 month to 1 year or slightly longer than 1 month.

I wanted to understand if that happens, what would be the margin impact on the product?

That would be very helpful.

Moderator · Conference Operator

The next question comes from the line of Shobhit Sharma from HDFC Securities Limited.

Shobhit Sharma

Sir, my question is on your rider attachment.

You have mentioned that the rider attachment during the quarter was around 40-odd percentage.

Can you help us understand how has this moved as compared to last year Q1 and last year, Q4 FY '25?

And what would be our aspiration to take this number to? and lastly, if you can clarify whether this rider proportion of the premium is categorized in the term segment or the respective business segment?

Moderator · Conference Operator

We take the next question from the line of Prithvish Uppal from Elara Capital.

SBI Life Insurance Company Limited July 24, 2025

Prithvish Uppal

Congratulations on good results.

I just have one question, which is on the competition intensity that you alluded to in the non-par segment.

So I think the understanding was that post implementation of surrender regulation, there would have been a little bit less intensity here at least in terms of the pricing.

So just wanted to get your thoughts on the same and your outlook for this particular product category for the year ahead?

Moderator · Conference Operator

We take the next question from the line of Jeet Suchak from Asian Market Securities.

Jeet Suchak

So in the current quarter, Credit Life grew by 25%, but what I'm hearing from the market so that credit disbursements are lower from the few quarters in the industry?

So the growth is coming from the lower base or what is the strategy that is driving the growth?

And also what is the Credit Life mix in the group protection?

Moderator · Conference Operator

Thank you.

Ladies and gentlemen, we take that as the last question and conclude the question-and-answer session.

I now hand the conference over to Mr. Amit Jhingran for his closing comments.

Amit Jhingran

Thank you very much for your time and the queries, everyone.

You may get in touch with our Investor Relations team in case you have any follow-up questions.

All the best to all of you.

God bless.

Moderator · Conference Operator

Thank you, sir.

On behalf of SBI Life Insurance Company, that concludes this conference.

Thank you for joining us, and you may now disconnect your lines.

Safe harbour

Please note that this transcript has been slightly edited for the purpose of clarity.

Except for the historical information contained herein, statements in this release which contain words or phrases such as 'will', 'would', ‘indicating’, ‘expected to’ etc., and similar expressions or variations of such expressions may constitute 'forward-looking statements'.

These statements by the Company and its management are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions and are not guarantees of future performance.

Because forward- looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control, and actual results could differ materially from those presented in the forward-looking statements.

Questions and answers

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