Financial Performance Highlights

Q2 FY27 Key Metrics:

  • Total insurance premium: ₹9,385 Cr, up 38% YoY
  • Consolidated operating revenue: ₹2,178 Cr, up 35% YoY
  • PAT: ₹192 Cr, up 43% YoY
  • PAT margin: 9% (improved from 8% in previous period)
  • Core insurance revenue: up 42% YoY
  • Core credit revenue: up 19% YoY

Operational Highlights:

  • Core online new health and term insurance grew 42% YoY
  • New health insurance specifically grew 46% YoY
  • Core new premium (excluding savings) has grown above 34% for 14 consecutive quarters
  • Core renewal and trail revenue: nearly ₹1,100 Cr (rolling 12-month basis, up 42% YoY)
  • Credit disbursals in core business grew 22% YoY (fifth consecutive quarter of growth)
  • Insurance-led initiatives (PB Partners, UAE Business, PB for Business): ₹826 Cr revenue, up 40% YoY, nearing break-even
  • UAE Premium grew 36% YoY

Regulatory Context - IRDAI Consultation Paper

Management addressed the IRDAI consultation paper that aims for:

  • Lower mis-selling
  • Better claims experience
  • Lower prices
  • Deeper insurance penetration

The company expressed full support for these goals but acknowledged that lower distribution payouts will reduce insurance distribution revenue. The management outlined a three-pronged mitigation strategy:

1. Expand non-insurance revenue within regulatory permissions

2. Accelerate ecosystem offerings

3. Evaluate other options to strengthen business over time

Claims Performance Metrics

  • Health claim settlement rate: 97% (vs industry average of 87%)
  • 11,156 rejected claims worth ₹185 Cr were reopened and paid last year
  • H1 FY27: Supported ~1.25 lakh health claims and 80,000 motor claims
  • Customer satisfaction: consistently above 90%

Persistency Metrics

  • Life policies: 71% in force at month 61 (vs benchmark of 51-66% for large players)
  • Health insurance renewal: 89%, rising to 91% from second-year renewals onwards

Complaint Metrics

  • Life insurance: 16 complaints per 10,000 customers (vs benchmark of 30-53)
  • Health insurance: 21 claim complaints per 10,000 claims (vs benchmark of 29-54)

Market Position

  • Health customers pay 9% less on average (up to 30% less than some channels)
  • 40% of new retail health customers in India come through Policybazaar
  • 17.8% of retail health premium and more than 25% of pure term premium came through Policybazaar last year
  • 74% of term policies and 64% of health policies from Tier 2 and Tier 3 cities

Cost Management and Strategy

Management emphasized maintaining strict cost discipline while:

  • Not cutting back on customer proposition (choice, transparency, claim support remain non-negotiable)
  • Remaining fully compliant with regulations
  • Repurposing existing management for new ecosystem offerings rather than hiring externally
  • Leveraging AI/GenAI for efficiency improvements (advisors handling 15-20% more leads, improved conversion, faster training)

Business Unit Updates

Paisabazaar:

  • Focused on adding new bank partnerships
  • Expanding into bill payments and wealth products (bonds, fixed deposits)
  • Maintaining risk discipline on credit quality

PB Health:

  • On track for ₹500 Cr annual revenue run rate by March 2027 (₹40-45 Cr monthly)
  • Currently breaking even in the business
  • Focus on executing existing hospital properties before aggressive growth
  • Addressing claims management through better disclosure and network management

PB Partners:

  • Revenue approximately ₹700 Cr for the quarter
  • POSP business model under review due to regulatory changes

Capital Expenditure

CapEx increased substantially (almost 4x compared to last year) primarily for:

  • Office expansion
  • Staff support infrastructure
  • However, October hiring was significantly reduced compared to historical patterns

Forward-looking Commentary

Management outlined a 1000-day strategy focusing on:

  • Serving customers well
  • Maintaining cost discipline
  • Continuing investment in underpenetrated markets
  • The company emphasized waiting for final regulations before making significant strategic changes

Regulatory Engagement

The company has:

  • Engaged constructively with IRDAI
  • Had multiple meetings with the chairman
  • Committed to fully aligning with regulatory expectations on dark patterns and other requirements
  • Submitted feedback along with 1,000+ other stakeholders