Axis Bank becomes a co-promoter of

Axis Bank becomes a co-promoter of Max Life

•            Axis Entities will own 12.99% stake in Max Life

•            Max Life’s Board to be recast with three Axis nominees

•            Axis Entities have right to acquire another 7% in Max Life

Axis Bank Limited (“Axis Bank”), India’s third largest private sector bank, together with its subsidiaries Axis Capital Limited and Axis Securities Limited (collectively referred to as “Axis Entities”) have become the co-promoters of Max Life Insurance Company Limited (“Max Life”), after completion of the acquisition of 12.99 % stake collectively by the Axis Entities in India’s fourth largest private life insurance firm - Max Life.  The Board of Max Life recorded the closure of the deal today.

 The transaction was completed after the Insurance Regulatory and Development Authority of India (IRDAI) gave its formal approval in February this year. Max Life’s holding company Max Financial Services Limited (“MFSL”) and Axis Bank had first announced their intent to bring in the latter as a strategic partner in Max Life in February 2020.

Transaction

Axis Bank and its two subsidiaries—Axis Capital Limited and Axis Securities Limited collectively own 12.99% stake in Max Life after the consummation of the deal. The Axis Entities have a right to acquire an additional stake of up to 7% in Max Life, in one or more tranches, subject to regulatory approvals.

With the conclusion of this transaction, Max Life’s Board will be strengthened further, with co-option of three nominee directors of Axis Entities on its Board. 

Amitabh Chaudhry, Managing Director & CEO, Axis Bank said: “We are delighted to see the strategic partnership come through. Axis Bank has been a long-term partner to Max Life and together we have contributed to deepening insurance penetration in India over the last decade. We have the opportunity now to shape the future of the industry through continued leadership in products, technology, and customer centricity. We are confident this venture will enhance the value for all the stakeholders of Axis Bank and Max Life.”

Welcoming this long-awaited strategic development, Analjit Singh, Chairman of Max Group and Max Financial Services, said, “The conclusion of this transaction is truly a monumental milestone, which will bring added strength to Max Life and help it chart a new growth trajectory by combining the forces of the third largest private bank in India with the fourth largest private life insurer in the country.

We are again privileged to welcome another sterling name to Max’s history of storied partners. Throughout our decade-long business association, Axis Bank has exhibited value across customer insights, distribution expertise and a myriad of functional benefits which will be of great benefit to our business.”

Subrat Mohanty, Group Executive, Banking Operations & Transformation, Axis Bank, said, “We have a long-term commitment to build a strong insurance distribution platform for our customers. This deal is an affirmation of that commitment. Max Life is a well-managed professional organization with a stellar track record. We are excited to enter into this new phase in our partnership with them.”

Mohit Talwar, Managing Director, Max Financial Services, said, “With the conclusion of this deal between Max Life and Axis Bank, we are ready and equipped to integrate the synergies of the two players and commence a relationship that will cement Max Life’s position as a top quartile life insurer delivering sustainable and profitable growth.”

Prashant Tripathy, Managing Director & CEO, Max Life Insurance, added, “This closure marks a new phase of growth and stability for Max Life. The JV enhances our brand in the eyes of our customers, business partners and investors by integrating the resources and benefits that the two players bring. This development is also a reflection of the relentless efforts put in over the years by the Max Life team. We are looking forward to entering this promising era for Max Life with utmost fervor and dedication.”

Axis Bank has shared a successful business relationship with Max Life for over a decade, providing long-term saving and protection products to nearly 20 lakh customers. The total premium generated through this alliance has aggregated to over Rs. 40,000 crores. Both companies have invested extensively in product and need-based sales training, thereby leading to a consistent increase in productivity.

Max Life has been consistently outperforming the private industry. Its asset under management (AUM) grew by 23% YoY and reached Rs 84,724 crore as on 31st December 2020, which has more than doubled in less than 4 years. In the last four years (FY 16 –20), its Individual Adjusted New Sales registered a compounded annual growth rate (CAGR) of 18%. In the first 11 months of last fiscal FY 21, Max Life has outperformed the top three private players with YoY Individual Adjusted New Sales growth of 14%.

Max Life Insurance achieves Claims Paid Ratio of

 Max Life Insurance achieves Claims Paid Ratio of 99.22% during FY 2019-20

• Paid 15,342 death claims during the financial year 2019-20*
• Digital forensic controls and predictive analytics underwriting models decrease repudiation ratio to 0.78%

Max Life Insurance Company Ltd. (“Max Life” / “Company”), in line with its continued promise of trust to its customers, announced that it has paid off 15,342* claims received in FY 2019-20, thereby settling INR 562.54 crores* worth of individual claims received in FY 2019-20. The Company has achieved high claims paid ratio of 99.22%* – in comparison with the company’s last five-year performance.

With consistent investment in fraud detection and mitigation at the issuance stage through robust predictive analytical based underwriting models, Max Life has demonstrated steady improvement of 226 bps in claims paid ratio over the last five years from 96.95%** in FY 2015-16 to its current figure of 99.22% in FY 19-20*. During FY 2019-20, out of total death claims received, only 120 were rejected and 1 case was pending for closure at the end of the financial year. The company’s repudiation ratio has fallen to 0.78% at the back of best-in-class digital forensic controls.

Since its inception till March 2020, Max Life has paid INR 3801 crores towards 128,288 policies for individual death claims.

Commenting on the accomplishment, Mr. Manu Lavanya, Director and Chief Operations Officer, Max Life said, “Over the years, we have remained steadfast in our commitment towards our customers by working towards improving our claims paid ratio - the ultimate moment of truth that defines a life insurer’s relationship with its customers. Our consistent performance in achieving 99.22% claims paid ratio in FY 19-20 bears testament to the devotion we have towards our customers. We are committed to further enhancing our investments in the areas of improved underwriting capabilities, technological interventions, and an overall robust claims ecosystem to ensure that we scale newer heights when it comes to settling claims in a timely and efficient manner.”

Given the disruption caused by the COVID-19 pandemic, Max Life has digitized its claims management process to ensure that all support documents are accepted online, and customers can submit claims on time through WhatsApp, email or by using self-service options - website, digital bots, and AI-driven interactive voice response.

*Basis IRDAI Annual Report 2019-20

**Basis IRDAI Annual Report 2015-16

 

Universal Sompo General Insurance

Universal Sompo General Insurance Co. Ltd Q1 FY21 PAT up by 165% at ₹ 46.21 Cr

The Board of Directors of Universal Sompo General Insurance Co. Ltd approved its Unaudited Financial Results for the quarter ended June 30^th, 2020.

Universal Sompo General Insurance Co. Ltd reported PAT of ₹ 46.21 Cr in Q1 FY21 (growth of 165% as compared to Q1 FY20), which was better than expected performance. The GDPI of the company rose by 16.62% to ₹ 418.62 Cr in Q1 FY21.

The loss ratio improved by 2.58% to 78% as compared to Q1 FY20 at 80.58%. This was mainly due to an improvement in Health Insurance, Personal Accident Insurance, Marine Insurance and Motor Insurance loss ratio. The combined operating ratio improved by 7.16% to 101.41% (Q1 FY20 was 108.57%). The Company reported a healthy growth of 25.34% in its investment income to ₹ 56.38 Cr as compared to ₹ 44.98 Cr in Q1 FY20 last year. Shareholder net worth increased by 4.59% in Q1 FY21, while the solvency ratio stands at 2.21 times.

Health Insurance remains a key growth driver for the company. It is important to note that Motor Insurance profitability is improving, and company has signed up some great digital alliances with many notable partners.

Apart from introducing a Covid-19 specific health product on a Group platform during the quarter, company has also begun to promote Arogya Sanjeevani, standardized health product formulated by IRDAI.

Liberty General Insurance Introduces

Liberty General Insurance Introduces ‘Liberty Assure’ – An Industry First Feature that Offers Waiver of Compulsory Deductible at NO EXTRA PREMIUM

-          Introduced under Regulatory Sandbox approval received from IRDAI

-          Waiver of ‘Compulsory Deductible’ at No Extra Premium at the time of raising a claim/Loss

-          Savings of INR 1000/INR 2000 per claim

-          The additional benefit of Service Warranty ascertains that Peace of Mind comes standard for the customers

-          Feature available to customers across select cities- Ahmedabad, Jaipur, Kolkata, Bangalore, Hyderabad, Mumbai, Chandigarh, and Delhi-NCR

Liberty General Insurance Ltd. (LGI), in an industry first move, today launched an innovative service ‘Liberty Assure’ as a part of its existing Private Car Package Policy, under the Regulatory Sandbox approval received from IRDAI. This innovative offering is one of its kind in the industry where the customer will not have to bear the cost of ‘Compulsory Deductible’ for every claim at NO EXTRA PREMIUM to avail this service at the time of raising a claim/loss. The new feature will also give customers even more control over their insurance costs, thus enabling them to save more.

Additional benefits under this feature include the Service Warranty, which ascertains that Peace of Mind comes standard for the customers. It covers any defects arising from the repair of an accidental vehicle. The Company’s preferred provider network (PPN) workshop will make such loss good by providing the required repair/replacement of the defect at no additional cost. The customer can visit the same workshop with the service warranty certificate for any further repair/replacement of the defect. 

However, the service warranty will be available up to 6 months or 10000 kms and it will be effective from the date of delivery of vehicle from Liberty’s PPN Workshop.

All customers intimating their vehicle’s own damage partial loss claim(s) under Private car package policy during July 03, 2020 – December 31, 2020 will be eligible to avail the benefits specified under this unique feature at the Company’s PPN workshops only.

Further, this feature will be available to the customers across eight locations- Ahmedabad, Jaipur, Kolkata, Bangalore, Hyderabad, Mumbai, Chandigarh, Delhi-NCR. The vehicles repaired at Liberty’s PPN workshops will also entitle the customers to avail free value-added services such as pick-up & drop, exterior car wash, engine tune-up and A/C Check Up among others.

Speaking on the launch of this new feature under the regulatory sandbox, Mr. Roopam Asthana, CEO & Whole Time Director, Liberty General Insurance Ltd. said, “Innovation and customer centricity are a sine qua non in an industry where trust takes precedence. With the introduction of ‘Liberty Assure’—an industry first offering where the customers can save the cost of compulsory deductible without paying any additional premium—the Company re-affirms its commitment to innovate and design value-driven products and services for its customers. I am hopeful that such value-add services will lead to an increase in the penetration of motor insurance in the country by incentivizing more people to opt for private car package policy.

Illustration for reference only:

Like in all Motor insurance policies, a compulsory deductible is the amount that the insured must pay. If the compulsory deductible for a Private car is ₹2000 and the customer incurs a total assessed claim expense of ₹2500, then the customer’s insurance company will pay ₹500, after deducting the compulsory deductible of ₹2000. Now, with Liberty Assure, this ₹2000 will also be paid by the Insurance company.

What is a Compulsory Deductible?

It is a fixed amount deducted at the time of claims and it is common across all insurance companies (as prescribed by India Motor Tariff). It is determined based on the engine capacity of an individual’s private car. The compulsory deductible per claim in case of private cars up to 1,500 cc engine is ₹1000; for cars above 1,500 cc it is ₹2000