Private insurance companies HDFC Life Insurance and ICICI Prudential Life Insurance reported double-digit profit growth in the first quarter of the fiscal year 2026-27 (April-June quarter). This growth was driven by an increase in premium receipts, growth in investment income, and sustained business development.
HDFC Life increased its net profit by 11.9% year-on-year, reaching 611 crore rupees. Meanwhile, ICICI Pru recorded a stronger profit growth of 27.8% year-on-year, amounting to 386.2 crore rupees.
HDFC Life's investment income grew by 14.1% year-on-year, reaching 16,653 crore rupees for the quarter. ICICI Pru's investment income increased by 11.1% year-on-year, totaling 18,500 crore rupees. Premium income also remained high: HDFC Life's net premium income grew by 14.4% year-on-year to 16,548 crore rupees, while ICICI Pru's grew by 14.7% to 9,749 crore rupees.
HDFC Life's Annual Premium Equivalent (APE) increased by 9% year-on-year to 3,515 crore rupees. The Value of New Business (VNB) grew by 8.7% to 879 crore rupees from 809 crore rupees the previous year, although the VNB margin slightly decreased to 25% from 25.1%. The company's operating expenses rose by 18.8% year-on-year, reaching 3,871 crore rupees, with the rise in commission expenses by 20% to 2,101 crore rupees being the main factor.
HDFC Life's solvency ratio decreased to 185% as of June 30, from 192% the previous year. As for ICICI Pru, its APE grew by 14.6% year-on-year to 2,136 crore rupees. The company's VNB increased by 25% to 571 crore rupees compared to 457 crore rupees in the quarter a year ago, and the VNB margin improved to 26.7% from 24.5%. ICICI Pru's expenses rose by 17.9% year-on-year to 2,230 crore rupees, while commission expenses increased by only 3% to 1,014 crore rupees. ICICI Pru's solvency ratio improved to 225.4% as of June 30, compared to 212.3% the previous year.
Both insurance companies continued to diversify their sales channels, reducing dependence on the bancassurance channel. In HDFC Life, the bancassurance channel accounted for 57% of individual APE during the quarter, which is lower than 60% the previous year. Meanwhile, the agency channel contribution increased to 18% from 15%, and direct channels to 10% from 9%. Vibha Padalkar, Managing Director and CEO of HDFC Life Insurance, noted that in Q1 FY27, proprietary channels, including agency and non-bank alliances, grew by 17%, outpacing the industry, while business through the bancassurance channel showed moderate growth, leading to a 7% rise in individual APE. She added that there is an encouraging improvement in the company's share in partner banks, and further normalization is expected in the coming months.
Anup Bagchi, CEO of ICICI Prudential Life Insurance, emphasized that protection remains a key focus area, noting strong growth in retail protection business of 60.4% year-on-year in Q1 FY27. This growth was stimulated by the exemption of Goods and Services Tax (GST) for protection products and various initiatives by the company itself. This marks the third consecutive quarter where retail protection growth exceeded 40% following GST reforms.
ICICI Pru's share in the bancassurance channel of total APE decreased to 27% from 30% the previous year. Meanwhile, the contribution of partnership distribution increased to 15% from 13%, and group distribution grew to 23% from 19%. After the announcement of results, ICICI Pru shares rose by 4.1% and closed at 524.8 rupees on BSE, while HDFC Life gained 2.4% and finished at 568.5 rupees.
ICICI Prudential Life Insurance announced that it will seek regulatory approval to change the status of Prudential Corporation Holdings from promoter to investor. This decision followed the British insurer's agreement to acquire 75 percent of the shares in Bharti Life Insurance.
The insurer stated in a filing to the stock exchange that its two promoters—Prudential and ICICI Bank—signed a letter of undertaking on July 4. This was done to eliminate any potential conflicts of interest that might arise from Prudential's alleged acquisition of Bharti Life.
The statement indicated that the company would apply to the Insurance Regulatory and Development Authority of India (IRDAI) to reclassify Prudential from the 'promoter' category to the 'investor' category according to IRDAI regulations.
Under this agreement, Prudential commits to refraining from voting on special resolutions in ICICI Prudential Life unless they adversely affect its rights or interests. Furthermore, Prudential will ensure the resignation of its nominee director from the board after the company approves the reclassification statement and will not nominate a new director until this process is complete.
Once the reclassification takes effect, ICICI Bank will support the appointment of one director proposed by Prudential, provided that Prudential maintains at least a 10 percent stake in ICICI Prudential Life and is not a promoter or holder of more than 10 percent in another Indian insurance company.
The filing also mentioned that if the company decides to remove 'Prudential' from its name after reclassification, Prudential will take necessary steps to support the company. These steps include coordinating the transition and limited use of the Prudential brand and the iciciprulife.com domain.
Prudential signed final agreements in May to purchase 75 percent of Bharti Life Insurance shares, but this was subject to obtaining the necessary regulatory approvals.
As of June 30, ICICI Bank held a 50.84 percent stake in ICICI Prudential Life, while Prudential held a 21.89 percent stake. The insurer emphasized that it is not a party to the letter of undertaking signed by its two promoters.
