Shriram Life Insurance Shares

Annual Report Summary

Shriram Life Insurance Company Limited's 19th Annual Report for FY 2023-24 highlights its financial and operational performance, its adherence to regulatory guidelines, and its commitment to corporate social responsibility.

About Shriram Group & Sanlam Group:

• The Shriram Group, established in 1974, is a major Indian financial services player focused on reaching the common man, with assets under management of around INR 2,848 billion. Shriram Capital Private Limited (SCPL) serves as the holding arm for the group's financial services businesses, including life insurance.
• Sanlam Group, a leading African financial services company established in 1918, partners with Shriram Group in its insurance ventures, providing technical support and strategic guidance. Sanlam holds an effective 62% of Santam's shares. Sanlam Group consists of Sanlam Life and Savings (SLS), Sanlam Emerging Markets (SEM), Sanlam Investment Group (SIG), and Santam.

Financial & Operational Review (FY 2023-24):

• The company reports significant growth in new policies (446,793 compared to 290,156) and premium income (Rs. 3507.54 Crores compared to Rs. 2546.40 Crores). New business premium grew by 38%.
• Sum Assured in force reached Rs. 180525 Crores, and Funds under Management (including Share holders' Funds) reached Rs. 11282.05 Crores.
• The expense ratio increased to 31.6, from 28.6 in the previous year.
• Profit Before Tax was Rs. 166.06 Crores, and Profit After Tax was Rs. 157.96 Crores. Cumulative Profits reached Rs. 696.18 Crores.
• The company achieved a surplus of Rs 213.52 Crores after tax in the Non-Linked business.

Business Performance:

• The domestic life insurance industry registered 2% growth for new business premium, while private insurers saw 12% growth and LIC saw 4% de-growth.
• Shriram Life Insurance Company saw 38% growth in Individual New Business, compared to 7% growth for private industry and 2% de-growth for LIC.

Rural and Social Sector Obligations:

• The company met regulatory requirements for Rural and Social Sector obligations. Achieved 41% rural business versus a 20% requirement. Insured 7847450 social lives compared to 253369.

Solvency, Dividend, and Share Capital:

• The company's Solvency Ratio was 206% as of March 31, 2024, exceeding the IRDAI minimum requirement of 150%.
• A final dividend of Rs. 3.00 per equity share was approved for the year ended 31st March, 2023, and an interim dividend of Rs. 0.84 per equity share was declared for FY 2023-24. Total dividend payout for FY 2023-24 is Rs 68.88 crores.
• The company's paid-up equity share capital stood at Rs. 179,37,50,000 during the year.

Products and Operations:

• The company has 403 branches and 3003 active agents, with 41 POSPs, as of March 31, 2024.
• 10 new products were launched and 9 were withdrawn during the year.

Governance and Compliance:

• There were no public issues, rights issues, or preferential issues during the year. No loans were taken from banks.
• The company has an Internal Control System commensurate with its size and complexity.
• The company has complied with Secretarial Standards on Meetings of the Board of Directors (SS-1) and General Meetings (SS-2) issued by the Institute of Company Secretaries of India (ICSI).
• The company has not accepted deposits within the meaning of Section 73 of the Companies Act, 2013.

Directorate Changes:

• Duruvasan Ramachandra and Stephanus Phillipus Mostert retire by rotation.
• V. Manickam and Venkatakrishna Narayana were appointed as Additional Directors.
• Thian Joost Fick was appointed as a Nominee Director.
• Brahmaiah Telaprolu resigned as Chief Finance Officer.
• Anand Soni was appointed as the Chief Finance Officer.
• Daniel Hermanus Gryffenberg resigned from the directorship.

Remuneration & Evaluation:

• The Board has approved a remuneration policy as per IRDAI guidelines.
• Bibhu Prasad Kanungo is paid Rs. 36,00,000 per annum.
• Board performance evaluations are conducted annually.

Meetings:

• Six Board Meetings and twenty-six Committee Meetings were convened during the year.

Other Disclosures:

• No material changes or commitments have affected the financial position of the company.
• No significant orders were passed by regulators or courts that impact the going concern status.

Directors' Responsibility Statement:

• The directors confirm adherence to accounting standards, maintenance of records, preparation on a going concern basis, and adequate internal financial controls.

Related Party Transactions:

• All related party transactions were on arm's length basis.

Corporate Social Responsibility (CSR):

• The Company has a CSR Committee. No Subsidiary, Joint Venture or Associate Company. Details of CSR Policy are included.

Auditors:

• M/s. GD Apte & Co. and M/s. CNGSN & Associates, LLP are the Joint Statutory Auditors.

Risk Management:

• The company has a risk-based internal audit framework.

Corporate Governance:

• The company adheres to Corporate Governance Regulations prescribed by IRDAI.

Indian Accounting Standards (Ind AS):

• The company is likely to fall under Phase 3 for Ind AS implementation.

Sexual Harassment:

• The company has zero tolerance for sexual harassment. No cases were filed pursuant to the Act.

Technology Absorption:

• The company aims to improve technology for customer service. Its foreign partner influences its technology plan.

Foreign Exchange:

• Foreign exchange earnings were Rs. 6.71 crores, and outgo was Rs. 4.78 crores.

Appreciation & Acknowledgements:

• The Board acknowledges faith and support from Policyholders, Shareholders, Banks, Financial institutions, Sanlam, IRDAI, and employees.