New Delhi, Wednesday,29th June, 2011:
MetLife India Insurance Company Limited (MetLife) today announced that the company has posted a net profit of Rs 35.35 crore for the financial year ended March 31, 2011, for the first time since it has launched operations in the country. MetLife India posted a loss of Rs 274.82 crore at the net level in the previous financial year ended March 31, 2010.
Improved operational efficiency coupled with planned sales helped the company register a profit. Further, persistency and robust risk management lead to reduced claims and dynamic product mix with a strong focus on traditional products.
“I am glad that we have achieved a break-even an year ahead of our plan. This is a testimony to the promise we made to our shareholders 5 years back to make the company profitable, while delivering growth. We have been able to balance our growth with profitability despite the uncertainty in the sector and this can be attributed to our healthy product mix and operational efficiency initiatives,” said Mr. Rajesh Relan, Managing Director & CEO, MetLife (India) while commenting on the performance.
The company registered flat total revenue at Rs 2,615.13 crore for the financial year ended March 31, 2011 compared to Rs 2,627.63 crore in the previous financial year. Renewal income has witnessed a 22% jump and grew to Rs 1801.95 crore from 1474.16 crore in the corresponding financial year. However, new business premium declined by 33.49 per cent owing to the market conditions.
Operating expenses declined 17.32 per cent to Rs 563.84 crore compared to Rs 681.99 crore for the year ended March 31, 2010. Further, operating expenses as a percentage of gross premium has declined to 22% from 27% in the previous financial year. MetLife India’s solvency ratio improved to 1.69 from 1.65. As on March 31, 2011, asset under management stood at Rs 7,851.46 crore compared to Rs 5,950.63
Mr Relan also added, “We are in discussion with leading banks and other financial institutions to expand our distribution, while we continue to improve the productivity and efficiency of our agency business. In our employee benefits business, we have been rated as the no.1 competitor by the industry players. We will continue to maintain the growth momentum and endeavour to grow faster than the market to increase the size of our profits”.
MetLife India has a well balanced portfolio of unit linked, traditional and group products, though the company has emerged as one of the highest mix of traditional products, which now comprise close to 50% of its product portfolio, compared with rest of private players (Life) at less than 10%. This provides us access to various customer segments having diverse needs and risk profiles and continues to give an edge for both growth and profitability. MetLife’s strategy of focusing on traditional plans has helped it deliver better margins, and a balanced product mix will continue to help in that effort.
Post the new regulation that has come into effect from September 1, 2010, the real trends are emerging gradually. Sales in the entire industry have been lower in September and October and growth seems to be flat over the previous year. As the company continue to achieve its planned sales along with the initiatives mentioned above, it will continue to restrain profits.
About MetLife India Insurance Company Limited
MetLife India Insurance Company Limited (MetLife) is an affiliate of MetLife, Inc. and was incorporated as a joint venture between MetLife International Holdings, Inc., The Jammu and Kashmir Bank, M. Pallonji and Co. Private Limited and other private investors. MetLife is one of the fastest growing life insurance companies in the country. It serves its customers by offering a range of innovative products to individuals and group customers at more than 700 locations through its bank partners and company-owned offices. MetLife has more than 55,000 Financial Advisors, who help customers achieve peace of mind across the length and breadth of the country.
MetLife, Inc., through its affiliates, reaches more than 70 million customers in the Americas, Asia Pacific and Europe. Affiliated companies, outside of India, include the number one life insurer in the United States (based on life insurance in force), with over 140 years of experience and relationships with more than 90 of the top one hundred FORTUNE 500® companies. The MetLife companies offer life insurance, annuities, automobile and home insurance, retail banking and other financial services to individuals, as well as group insurance, reinsurance and retirement and savings products and services to corporations and other institutions. For more details visit our website www.metlife.co.in
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Balachander Sekhar, MetLife India Insurance Co. Ltd.,