(12m) 2013-14

This is the sole and exclusive property of HDFC Life

HDFC Standard Life Insurance Company Limited

Financial Year ended March 2014

Economic overview

Overview of Indian life insurance industry

HDFC Life performance

2

Agenda

In purchasing power parity (PPP) terms, India is now the world’s third largest economy with 6.4 percent share of global GDP

Strong macro economic prospects coupled with increasing working population and higher income levels presents a huge opportunity for financial services in India

India’s middle class expected to make India a sizeable savings-led and consumption-driven market, acting as the growth engine for the economy in the medium to long term

Stabilising real estate prices and the softening of gold prices shall help shift a proportion of domestic savings towards financial instruments

Key parameters growth forecast

3 Source : IMF WEO (October 2013), OECD Economic Outlook No.93, EY Attractiveness Survey India – 2014, RBI, World bank’s ICP

2014 2016 2018

GDP Growth (%) 5.1 6.5 6.7

Gross National

Savings (% of GDP) 31 32 33

Current Account

Deficit (% of GDP) 3.8 3.2 2.8

Consumer Price

Inflation (%) 9 7 7

Potential

employment (Crs) 48 50 52

Financial services poised for growth

48% 44% 50% 50%

52% 56% 50% 50%

FY 2004-08 FY 2011 FY 2014 (E) FY 2017 (P)

Household Savings Composition

Financial Savings Physical Savings Household Savings as % of GDP

23% 24% 24% 25%

11%

56%

19%

14%

Financial Saving of the household sector

(Gross) FY12

CurrencyDepositsShare and DebenturesLife Insurance FundsProvident and Pension Funds

10%

56%

3%

16%

15%


(Gross) FY13

CurrencyDepositsShare and DebenturesLife Insurance FundsProvident and Pension Funds

Source: * MasterCard Index of Financial Literacy Report, 2013, Financial Literacy ranking computed as weighted average of Basic Money Management, Financial Planning and Investment ranking, # RBI Annual Report 2013, ^ FICCI & BCG Report on life insurance, 2013 4

India financial literacy ranking*

Parameter Rank

Financial Literacy 15

Basic Money Management 16

Financial Planning 9

Investment 11

Financial savings of household sector (Gross) FY13#

India ranked 15th out of 16 countries across Asia Pacific region in financial literacy. Increased financial awareness among people will lead to higher participation in financial products

Increasing life expectancy and shift towards nuclear families demands increasing focus on financial planning for retirement and protection needs

The long-term savings and protection offerings from the industry are unique among the competing product class. They will serve to increase the level of financial protection in the economy

The low penetration of life insurance at 3.2%^ of GDP in FY13 indicates promising growth prospects for the industry

Growth potential for life insurance industry

FY13 FY12 10%

56%

3%

16%

15%


(Gross) FY13

Currency Deposits Share and Debentures

Life Insurance Funds Provident and Pension Funds

Economic overview



5

Agenda

2,000

7,000

12,000

17,000

22,000

27,000

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

13 7 4

Number of private life insurance entrants

Entry of Private Life Insurers

Start of Equity Bull Market

Global Financial Crisis

Riding the wave (ULIPs1) 1st wave of private

insurers 2nd wave of entrants

Companies stabilising their

operating model, 3rd wave

BSE S

EN

SEX

Life Insurance in India has seen 3 distinct phases post FY 2000 – the market has 24 private life

insurers present today

Shift of focus to quality growth and regulatory changes to ensure policyholder’s protection, resulted

in a more stable performance for the industry post FY 2010

1 Unit Linked Insurance Plans are products where the investor bears the investment risk. Graph not as per scale

Source : BSE Sensex Performance Jan 1, 2000 – March 31, 2014, Google Finance, HDFC Life Analysis. 6

The development of life insurance industry in India

138

260 261

203

262273

304292 282

72

143

266 269288

230

175 178 172

34%35%

50%

57%

52%

46%

37% 38% 38%

-5%

5%

15%

25%

35%

45%

55%

65%

0

50

100

150

200

250

300

350

400

450

FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14

Priv

ate

Mar

ket

Shar

e %

Ind

ivid

ual

WR

P in

Rs.

Bn

LIC Private Players Private Market Share

* Data presented above is basis Individual WRP

Source: IRDA data, HDFC Life Analysis

Insurance industry opened to private sector in 2000 and garnered 57% market share in individual

WRP by FY09

Between FY09 and FY14, private sector slowed down with de-growth of 9% CAGR, while LIC

continued to grow at 7% CAGR resulting in a slide in the private sector’s market share

The industry had to continuously reinvent to stay relevant to customers and distributors due to the

pace & magnitude of regulatory changes

With stabilisation in product regime ensuring higher protection and onset of online channel, industry

is poised for steady growth in future

Note: WRP refers to Weighted Received Premium

7

ULIP

Regulations in

Sept 10

Industry new business* trends

83%

69%

41%

35%

17%

31%

59%

65%

FY10 FY11 FY12 FY13

UL Conventional

83%

69%

41%

35%

17%

31%

59%

65%

FY10 FY11 FY12 FY13

UL Conventional

51%47% 44%

40%

25% 33% 39%43%

10%9%

8% 6%3%

5%5%

5%11%

6% 4% 6%

FY10 FY11 FY12 FY13

Individual agents Corporate Agents ‐ Banks Corporate Agents ‐ Others

Brokers Direct Business

Industry seen to be moving to a more stable regime due to increase in focus on conventional

products and new product guidelines issued by IRDA in recent years

Alternative distribution channels such as Online and Direct

serve as a cost-efficient means of selling insurance products

give insurers an opportunity for developing a direct relationship with the customer

Source: IRDA Journal

Distribution Mix Product Mix

8

Private Industry Distribution & Product mix

Economic overview



9

Agenda

10

Reven

ue

• Total premium growth of 7% (PY 11%)

• Renewal premium higher by 17% (PY 9%)

• Conservation ratio* at 79% (PY 79%)

• Continued to rank amongst Top 3 in private sector in individual and group business

In

dia

n G

AA

P F

inan

cia

ls

• Maiden dividend of ` 1.0 bn (5%)

#

• Registered net profit of ` 7.3 bn with growth of 61% (PY ` 4.5 bn)

• Expense ratio at 10.7% of total premium (PY 10.8%)

AU

M a

nd

NB

M

• Assets under management at ` 503 bn (PY ` 401 bn)

• Assets under management grew at CAGR of 25% over the last 5 years

• NBM stood at 26.2% for individual business (PY 17.8%)

• Solvency Ratio of 194% against a regulatory requirement of 150%

Performance Snapshot

* Conservation ratio has been reworked after adjusting for change in accounting policy for unit-linked business since Q1 FY13. Conservation ratio is for individual business

# Dividend @ 5% on face value of shares of ` 10 each excluding Dividend Distribution Tax

15.5%

17.5%

13.8%

5.7%

6.7%

5.2%

FY12 FY13 FY14

8.7%

10.9%

14.4%

1.9%2.5% 2.5%

FY12 FY13 FY14

WRP growth impacted mainly due to processes

introduced to strengthen the quality of business

which is reflected in strong growth in total

premium

Rebound in Q4 FY14 with market share of 16%

3 4 3 Rank 2 2 3

Ranked 3rd amongst private players in FY14

The Company grew by 30% whilst private

sector de-grew by 1% in this segment for FY14

Individual WRP Group Premium

New Business Market Share

11

12.9%

15.5%

17.5%

13.7%

5.9% 5.7%6.7%

5.0%

FY11 FY12 FY13 11M FY14

Private Industry Total Industry

26.9 31.1 23.6

63.5

68.9 80.2

9.5

11.4 14.8

2.1

1.8

2.0

FY12 FY13 FY14

113.2

102.0

120.6

13%

-65%

29%

61%

-7%

11%

-13%

9%

20%

16%

7%

10%

17%

30%

-24%

Premium Income

12

Total premium grew by 7% vs PY, largely due to 17% growth in renewal premium and 30% growth in

group business

Consistent renewal growth over the years, aided by a number of customer education initiatives,

reflects the quality of business underwritten by HDFC Life

Introduction of stricter AML/KYC* related processes at new business stage to ensure business quality

has impacted first year growth

First Year Regular Premium (Individual)

Total Premium Single Premium (Individual)

Renewal Premium (Individual)

Group Premium

*AML - Anti-Money Laundering, KYC - Know Your Customer

` Bn

Distribution & Segment Mix

13

Contribution from non bancassurance channels increased vs PY in line with the Company’s

diversification efforts

The Company is investing in the new Develop, Nurture, Achieve (DNA) model under the Agency

umbrella and has also established new relationships with various NBFCs in FY14 as a part of its

diversification efforts

As a part of the product strategy, the non-par segment has picked up well due to strong growth in

online term products

Note: The percentages are with reference to APE for individual business

19% 16% 16%

4% 7% 7%

73% 72% 70%

4% 5% 7%

FY12 FY13 FY14

Agency Broker Bancassurance Direct

56% 61%49%

43% 36%

36%

1% 3%

15%

FY12 FY13 FY14

Unit Linked Participating Non Participating

11.7 12.2 12.9

11.5% 10.8% 10.7%

-50.0%

-40.0%

-30.0%

-20.0%

-10.0%

0.0%

10.0%

20.0%

30.0%

-

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

20.0

FY12 FY13 FY14

11.7 12.2 12.9

11.5% 10.8% 10.7%

-50.0%

-40.0%

-30.0%

-20.0%

-10.0%

0.0%

10.0%

20.0%

30.0%

-

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

20.0

FY12 FY13 FY14

Operating Expenses Operating Expense/Total premium Ratio

Operating Expenses

14 Note: Operating expenses exclude service tax

Opex / Total Premium Ratio continues to decline and is one of the lowest in the industry

Significant investments made in new distribution channels, products, technology and digital space

while keeping costs under stringent control

` Bn

101.5 112.6

119.7

27.0 35.7

40.6

1.9 3.3 6.0

72.5 73.6 73.1

-

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

-

20.0

40.0

60.0

80.0

100.0

120.0

140.0

160.0

FY12 FY13 FY14

Total Premium Surrenders & Withdrawals

Claims by Death, Maturity & Others Net Cash flow

Premium less Policyholder Payouts

15

Note: Total Premium and Benefits Paid are net of reinsurance Source: Public Disclosures

Focus on need based selling with strengthening of AML/KYC processes has enabled the Company to

maintain a healthy positive premium post policyholder payouts

The Company continues to maintain the highest premium post policyholder payouts amongst peer

companies

` Bn

Conservation Ratio

16

80% 79% 79%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

FY12 FY13 FY14

Persistent efforts in customer education, customer interaction avenues and a heightened focus on

“need-based” selling helped the Company maintain its Conservation ratio

Successful in maintaining a high Conservation ratio relative to peers, despite adverse regulatory

changes post Sept 2010

Note: Conservation ratio is for individual business and has been reworked after adjusting for change in accounting policy for unit-linked business

Source: Public disclosures

Persistency Ratios

17

Improvement in 49th month persistency due to higher proportion of v5 products (with better persistency)

in CY vs PY

Persistency of non-annual mode has shown improvement in CY after introduction of pre-conversion

verification calling

Drop seen in 13th month persistency aided by guarantee on Discontinued Policy Fund

78%

91%

70% 71%66%

71%

89%

70%

83%

61%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

13th month 25th month 37th month 49th month 61st month

FY13 FY14

Note: Persistency ratios have been calculated with a lag of 3 months on reducing balance basis

1.1 0.6

2.5 3.9

7.7 0.2

0.6

(0.4)(0.5)

0.5

1.5

2.5

3.5

4.5

5.5

FY12 FY13 FY14

3.8

5.1

7.3

Indian GAAP Results

18

Maiden dividend of ` 1.0 Bn (5%*)

Declared a net profit of ` 7.3 Bn in the current year due to a strong back book, primarily contributed

by UL segment

Surplus from back book has helped us invest in new channels such as Protection and Health that have

high levels of strain

* Dividend @ 5% on face value of shares of ` 10 each excluding Dividend Distribution Tax Notes: 1. Deficit in Revenue account as of 31st March 2012 of ` 0.6 Bn was completely off-set in Q1 FY13 2. Tax credit of ` 0.8 Bn during FY14 is unrecognised previous Deferred Tax Credit, which has been recognised in accordance with AS 22

` Bn

(50)

50

150

250

350

450

550

FY 2012 FY 2013 FY 2014

Shareholders' surplus Policyholders' surplus Deficit reversed in policyholders' A/c

48%55% 54%

52%45% 46%

31st Mar 2012 31st Mar 2013 31st Mar 2014

Debt Equity

323

401

503

17,404

18,836

22,386

13,500

15,500

17,500

19,500

21,500

23,500

25,500

150

200

250

300

350

400

450

500


AUM in Rs bn Sensex

25.3%

21.7%

24.4%

Growth in AUM vs LY

Assets Under Management

19

AUM at ` 503 bn in FY14, growing by 25% vs PY and at a 3 year CAGR of 24%

The debt-equity mix has stabilized over the recent years with the Company maintaining a balanced

portfolio

48%55% 54%

52%45% 46%


Debt Equity

MCEV as at 31st March 2014

20 Note: Market Consistent Embedded Value (MCEV) results are unaudited

` Bn

20.1

56.1

-1.0

-5.3

69.9

Shareholders Adjusted Networth

Present Value of Future profits

Frictional Cost of Required Capital

Cost of Non Hedgeable Risks

Shareholders Adjusted Net worth

20.1

+ Value of Inforce49.8

= MCEV 69.9

Cost of Non Hedgeable Risks

Present Value of Future Profits

Frictional Cost of Required Capital

Analysis of Change in MCEV

21

11.1

Embedded value operating profit (EVOP)

11.2

EV profit

* New business profits pertain to Overall (Individual + Group) business

` Bn

19% growth in MCEV vs PY

EVOP as a percentage of opening EV is 19%

` 1.6 Bn impact in methodology and assumption changes includes change in mortality and tax

assumption and guarantee costs

Operating variance is mainly due to adverse persistency experience

58.7

1.6 6.6 -2.5 4.4

-0.1 1.1 1.3 -1.2

69.9

MCEV at

31st Mar 13

Methodology

and

assumption

changes

New

business

profits

(before

expense

over-run)*

Acquisition

expense

overrun

Expected

return on

inforce

Operating

Variances

Investment

variances and

change in

economic

assumptions

MCEV at 31st

Mar 14

Tax

changes

Dividend

payout

New Business Profits

22

Change in product mix has enhanced our new business margin with Non Par products being major

contributors

` Bn

17% 18%

26%

11%

13%

16%

5%

10%

15%

20%

25%

30%

FY12 FY13 FY14

NBM (pre overrun) NBM (post overrun)

FY12 FY13 FY14

New business APE1 27.9 32.8 25.4

New business profits1,2 4.8 5.8 6.7

New business margin1,2 17.2% 17.8% 26.2%

New business profits (after impact of

acquisition expenses overrun) 1,22.9 4.3 4.1

1 Margins and APE are shown for individual business only

2 Based on loaded acquisition expenses

New business margin (after impact of

acquisition expenses overrun) 1 10.5% 16.1%13.2%

Progress on Strategic Themes

23

Long Term Positioning

• Average policy term has improved to 13.5 years (PY 12.3 years)

• Balanced product mix with Traditional (51%) and Unit Linked (49%)

• More than 3/4th business in Agency and Direct from traditional plans

Fortification & Diversification

• Agency channel distribution build-up with ~23,000 licences in FY14

• DNA comprising highly skilled productive work force successfully launched

• Direct and Group Sales primary growth engines in FY14

• Widened reach through new tie ups with NBFCs, MFIs and other partnerships

Owning Customer Segments

• Leader in launching 30 products (22 Individual and 8 group) under new regime

• First regular income plan (par) and first savings plan (non-par) launched

• Enhanced focus on Protection (Young aspirants) & Annuities (Wisdom Investors)

• Special products filed to cater to the “New India” customers through online medium

• Over 2.4 million Facebook fans, 0.1 million followers on Twitter & 29,000 followers on Linkedin

• Exclusive You Tube Brand Channel launched with Over 3,50,000 views in FY14

Progress on Strategic Themes Contd...

24

Unique Customer Experiences

• MyMix – personalised solution through need based product combination offerings

• Purchase process “wow” for customer and empowering front line sales personnel

• Revamped website - Simple, user friendly interface with 68.1% of the total service transactions processed through website

• 43.3% of renewal payments received through electronic and auto debit modes

• 81% of new business applications initiated using POS platforms

• Ranked 1st in group claim settlement ratio* (99.8%) and 2nd in Individual claim settlement ratio* (95.7%) amongst private players with average claim settlement time of 10 days

Cost Leadership

• Improving cost ratios

• No capital infusion in last 3 years

*As per data published by IRDA for FY13

Awards and Accolades

25 For more details about our Awards & Accolades, kindly refer our website at www.hdfclife.com

SAP ACE Award for Customer Excellence 2013 - Best Run Award in Budgeting, Planning & Consolidation

Silver award at Express IT Awards 2013

Golden Peacock HR Excellence award in private life insurance sector

Finnoviti 2013 award for Quest2Green project

HDFC Life- Swabhimaan awarded by Give India for its effort during Joy of Giving

Most admired Life Insurance Companies in Pvt Sector – BFSI

Awards 2014

Best Business Process Excellence Program at the National Quality Excellence Awards 2014

Awards and Accolades Contd…


Award for Brand Excellence (BFSI), Marketing Campaign of the Year &

Best Use of SM Marketing

Winner – Excellence in PR Financial Communication

Top 100 CISO Award 2013

TISS-Leap Vault CLO Award in Program in Sales Enablement category

Asian Leadership Award 2013 for Brand Excellence in Effective

Communication

National Award for Excellence in Cost Management

Loyalty Award for Financials - Non Banking Financial Sector

Awards and Accolades Contd…


CIO 100 Award (International) for Point of Sale– CLICK2BUY

Featured in 'Top 25 Best Places to Work for' 2013

Best Campaign in the Financial Services Sector &

Best In House Team of the Year

Gold for ‘Integrated Media Campaign of the Year by a

Brand’

D.L. Shah Quality Award for re-cycling customer payouts

Celent Model Insurer of Asia 2013 & Model Insurer Award

ASTD Citation for improving FLS Productivity

Appendix & Glossary

28

Appendix 1 : MCEV methodology and approach

MCEV methodology

The calculations of embedded value and new business profits have been performed using a market consistent embedded value (“MCEV”) approach. This approach differs from a traditional EV approach primarily in respect of the way in which allowance for risk is made.

Within the traditional EV approach allowance is made for risk through an increase in the risk discount rate used to value future shareholder cash flows, whilst within the MCEV calculation explicit separate allowances are made for risk.

Components of MCEV

There are two components to the MCEV:

1. Shareholders’ adjusted net worth –this component represents the market value of assets attributable to shareholders. This amount is derived from the Indian GAAP balance sheet adjusted to allow for assets on a market value basis, elimination of intangible assets and to allow for shareholder attributable assets or liabilities residing within the unit-linked and non Par policyholder funds.

2. Value of in-force –this component represents the discounted value of after tax shareholder attributable cashflows expected on the business as at the valuation date. No allowance is made for future new business. This amount has been adjusted to deduct allowances for non hedgeable risk, frictional costs of required capital and the time value of financial options and guarantees.

29

Appendix 2 : Components of value of in force (“VIF”)

30

Present value of future profits (“PVFP”)

This component has been calculated by discounting the projected future after tax shareholder attributable cash-flows expected to arise on in-force business at the valuation date. The cash-flows have been projected on a deterministic basis using the Company’s best estimate view of future persistency, mortality and expenses. Future investment returns and the risk discount rate have been set equal to the returns from the risk free (government bond) yield curve at the closing balance sheet date.

Time Value of Financial Options and Guarantees ("TVFOG")

The Company has regularly carried out analysis of the profile of guarantees in its Par funds to identify the level of guaranteed benefits occurring at future time periods. The investment strategy of the Par funds is re-set to enable, where possible, hedging of these guaranteed benefits through cashflow matching of the guarantees with fixed interest assets. As a result, the Company is of the view that there is no residual TVFOG associated with the Par funds.

The cost associated with the investment guarantees in the unit linked funds has been allowed for in the PVFP calculation.

Frictional Costs of Required Capital (“FCRC”)

The VIF allows for a deduction in respect of the frictional costs of holding required capital (“FCRC”). Required capital has been set equal to the amount of shareholder attributable assets required to back local regulatory

solvency requirements. The FCRC has been calculated as the discounted value of investment costs and taxes on shareholder attributable assets backing the required capital over the lifetime of the in-force business.

Cost of non hedgeable risk (“CNHR”)

The VIF incorporates an explicit deduction to allow for non hedgeable and non economic risks. The CNHR has been derived using a cost of capital approach and is calculated as the discounted value of an annual charge applied to projected risk bearing capital.

The initial risk bearing capital has been calculated based on 99.5th percentile stress events for non economic assumptions over a 1-year time horizon. This initial risk bearing capital has been updated based on the portfolio of business as at 31st March 2013.

Projected risk bearing capital has been determined by running-off the initial risk bearing capital in line with the expected movement in the regulatory solvency margin requirement.

99.5th Percentile stress events have been taken from the EU Solvency II, QIS 5 framework (previously QIS 4 framework). In order to allow for the greater risks associated with emerging markets, the risk bearing capital has been uplifted by 50%.

The annual charge applied to the projected risk bearing capital is 4% p.a.

The stress events, uplifts to NHR, run-off pattern for projected risk bearing capital and annual charge, are reviewed and modified if necessary on an annual basis.

Expenses

Maintenance expenses have been based on the latest expense analysis done in FY13 and are inflated at 7.5% per annum. These assumptions do not incorporate any allowance for future productivity improvements.

Given the substantial changes in regulations, the Company has reviewed its cost structure, as a result of which the long-term acquisition expense levels have been calibrated at a level lower than that used earlier. These new long-term acquisition expense levels, as approved by the committee of Board, have been incorporated into the pre-overrun margins.

Economic assumptions

The closing MCEV is calculated assuming projected earned and risk discount rates are both set equal to the risk free (government bond) yield curve at the closing balance sheet date.

The new business profitability is calculated with similar assumptions, except that the yield curve at the opening balance sheet date is used.

No allowance for any illiquidity premia is made within the earned rates, except for group credit spread products.

Mortality and morbidity

Mortality and morbidity assumptions are set by product line and are based on past experience.

Persistency

Persistency assumptions are set by product line, payment mode and duration in-force, based on past experience and expectations of future experience. Separate decrements are modeled for lapses, surrenders, paid-ups and partial withdrawals.

Tax assumptions

Tax assumptions are based on interpretation of existing tax legislation, where appropriate supported by legal opinion.

Profits attributable to shareholders are assumed to be taxed at 14.16% for Life business and 0% for Pensions business.

Allowance is made within the tax computation for dividend offsets permitted under Section 2A of the Income Tax Act and for losses incurred within the Shareholder Fund.

No allowance is made for future changes to taxation such as the Direct Tax Code. These changes will be incorporated only once materially enacted. It is expected that implementation of DTC in its current form will result in a material negative impact to the MCEV and new business profitability.

Appendix 3 : Key assumptions underlying MCEV

31

Analysis of change in MCEV

Opening modeling, assumptions and methodology changes: The models, assumptions and methodology are continuously refined and improved and the impact of these refinements is reflected in the opening changes.

Expected return on inforce: This item reflects expected investment income on shareholder assets during the period, and reflects that future shareholder profits are closer than at the start of the period. This positive item will occur in each MCEV period.

Operating Variances: The Operating Variances capture the impact of the deviations of the actual claims, persistency and maintenance expense experience during the period from that assumed in the opening MCEV calculation.

Investment variances and change in economic assumptions: This reflects the impact due to the actual investment return being different from the expected returns and the impact from the change in the yield curve at the end of the period compared to the yield curve at

the start of the period.

Appendix 4 : Key components underlying MCEV movements

32

Glossary

33

Commission ratio – Ratio of total commissions paid out on first year, single and renewal premiums to total premiums. Conservation ratio – Ratio of current year renewal premiums to previous year’s renewal premium and first year premium. APE (Annualized Premium Equivalent) – The sum of annualized first year regular premiums and 10% weighted single premiums and single premium top-ups. First year premiums – Regular premiums received during the year for all modes of payments chosen by the customer which are still in the first year. For example, for a monthly mode policy sold in March 2013, the first installment would fall into first year premiums for 2012-13 and the remaining 11 installments in the first year would be first year premiums in 2013-14. New business received premium – The sum of first year premium and single premium. Operating expense – All expenses of management excluding service tax. It does not include commission. Operating expense ratio – Ratio of operating expenses (excluding service tax) to total premiums. Renewal premiums – Regular recurring premiums received after the first year. Solvency ratio – Ratio of available solvency margin to required solvency margins. Total premiums – Total received premiums during the year including first year, single and renewal premiums for individual and group business. Weighted received premium (WRP) – The sum of first year premium and 10% weighted single premiums and single premium top-ups. 13th month persistency – Percentage of contracts, measured by premium, still in force 13 months after they have been issued.

Disclaimer

34

This release is a compilation of published financial results, other information and is not a statutory release. This may also contain statements that are forward looking. These statements are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could differ from our expectations and assumptions. We do not undertake any responsibility to update any forward looking statements nor should this be constituted as a guidance of future performance. This release is a privilege copy intended for reference of selected group. These disclosures are subject to the prevailing regulatory and policy framework as on March 31, 2014 and do not reflect any subsequent changes.

35

Thank You

In partnership with Standard Life

(12m) 2013-14

Documents