HDFC Life Q2 Profit Up 13.6% at Rs 508 Crore as Net Premium Income Grows Nearly 16%
HDFC Life net premium income grew nearly 16% in the second quarter, alongside higher profitability, reflecting growth in its insurance business.
HDFC Life reported a 13.6% year-on-year rise in Q2 profit to Rs 508 crore, supported by strong growth in net premium income.
NEW DELHI – HDFC Life Insurance Company closed the July-September quarter with a net profit of Rs 508 crore, about 13.6% more than the Rs 447 crore it earned in the same period last year. The country’s second-largest private life insurer announced the numbers on Thursday. Net premium income climbed nearly 16% to Rs 21,727 crore. Analysts following the company said business routed through its promoter, HDFC Bank, has begun to recover, which helped the quarter.
The recovery matters because the bank channel has been a pain point. Over the last year, the insurer’s sales through its parent slowed as regulators examined how banks market financial products and rivals competed hard for the same customers. In the April-June quarter, bancassurance premiums rose only about 2%, while agency and non-bank partnerships grew 17%. The bank route still accounts for roughly 60% of HDFC Life’s retail insurance sales, and HDFC Bank makes up a large part of it.
HDFC Life – Sales Outpace the Private Industry
Managing Director and CEO Vibha Padalkar said the company’s individual weighted received premium grew 11% in the second quarter, against 10% for private insurers as a group.Over the first six months of the year, that figure was 9%, and the company’s share of the market edged up to 16.2% from 16.1% at the end of June.
Annualised premium equivalent, a common yardstick for new sales, grew 13% in the quarter and 11% in the half-year. The count of individual policies sold rose 9% in the first half, also ahead of the industry. Padalkar said management expects to keep up this pace and grow in step with the sector through FY27.
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HDFC Life – Profitability of New Business Improves
Executive Director and CFO Niraj Shah said the value of new business, which estimates the future profit locked in by policies sold during a period, reached Rs 2,037 crore in the first half, up roughly 12.1%. That outpaced growth in sales volumes. For the second quarter on its own, the measure grew 14.8%. Embedded value, a broader gauge of the company’s worth, stood at Rs 66,461 crore, and the rolling 12-month operating return on it was 14.9%.
Profit after tax for the first half totalled Rs 1,119 crore, a rise of about 12.7%. Assets under management reached Rs 4.1 trillion, up 13.8% from a year earlier. Net commissions paid out to distributors grew 15.7% to Rs 2,685 crore.
HDFC Life – Commission Rules Under Review
The results arrive while the insurance regulator, IRDAI, collects industry feedback on a two-part consultation paper titled “Recalibrating Economics of Insurance Distribution.” Published on September 23, it invites comments until October 25. The regulator wants to bring back product-specific limits on commissions, which it dropped in 2023 in favour of a single ceiling on insurers’ overall expenses. Its own analysis found that between FY23 and FY25, what distributors earned grew four to five times faster than premiums.
Under the draft, the cap on pay would depend on the type of product, the sales channel and the effort needed to sell and service a policy. Incentives, rewards and promotional spending would be counted within the limits. Lenders would face restrictions on making insurance a compulsory add-on to loans, and commissions could be recovered where a policy was mis-sold. Smaller towns and rural areas would get higher limits to encourage insurers to widen their reach, and insurers’ overall expense limits would be lowered over time.
Padalkar said the regulator has asked industry players to back their feedback with data and keep policyholders’ interests at the centre. Market reports say January 1 or April 1, 2027 are being considered as start dates. After reviewing the responses, IRDAI is expected to issue draft regulations for a second round of public comment.
