Niva Bupa Health Insurance Company (NIVABUPA) Q4 19/20 earnings summary

Executive summary

• FY20 gross written premium rose 31% YoY to Rs 12,428,869 thousand; operating profit increased to Rs 1,171,579 thousand, while net loss widened to Rs 615,520 thousand from Rs 483,868 thousand.

• Auditors issued an unmodified opinion and found internal financial controls adequate and operating effectively; emphasis matters covered investment treatment and possible COVID-19 effects.

Financial highlights

• Net earned premium was Rs 8,410,691 thousand, up from Rs 6,594,788 thousand; net claims incurred rose to Rs 4,500,691 thousand from Rs 3,556,426 thousand.

• Net commission increased to Rs 428,756 thousand from Rs 308,500 thousand; insurance operating expenses rose to Rs 4,194,575 thousand from Rs 3,574,727 thousand.

• PBT and net loss were Rs 615,520 thousand, versus Rs 483,868 thousand loss in FY19; basic and diluted EPS were both (Rs 0.58), versus (Rs 0.51).

• Results included Rs 1,473,550 thousand excess expenses of management transferred from the Revenue Account to P&L, plus provisions of Rs 150,000 thousand for investment diminution and Rs 350,002 thousand for doubtful debts.

Outlook and guidance

• Management assessed COVID-19 effects as not significant to FY20 financial position or performance after actuarial and recoverability adjustments, but noted future impacts remain uncertain and estimates may change.

• IRDAI granted expenses-of-management forbearance through FY22; FY20 expenses were broadly in line with the submitted convergence plan.

• Strategic priorities focused on profitable, sustainable growth through agency and bancassurance expansion, direct and digital channels, cost optimization, and product development.