Leading private sector life insurer ICICI Prudential Life Insurance Co on Tuesday reported a flat net profit of Rs 303.22 crore in the September quarter, weighed down by higher tax outgo which offset the high underwriting profit and record margin from new premium income. The company had posted a net profit of Rs 301.86 crore in the year-ago quarter, it said in a statement.

The value of new business margin expanded to a record 27.4 percent for the quarter from 21.1 percent in the year-ago period. "We had very high underwriting profit, which clipped at 32 percent in the reporting quarter, while the margin in the value of new business jumped to a record 27.4 percent in the reporting quarter, yet higher tax outgo offset these gains," the company's managing director and chief executive N S Kannan told PTI.

He attributed the jump in value of new business (VNB) margin primarily to increase in protection mix and growth in non-linked savings. For the first time, the protection segment crossed 20 percent of total business, he added. VNB is a key profitability metric as it measures the profitability of new business written and it is the present value of all future profit to shareholders measured at the time of writing a new business contract.

Net premium income grew 6.3 percent to Rs 8,572.19 crore from Rs 8,064.71 crore a year ago, while total income more than doubled to Rs 16,835.36 crore. Investment income jumped to Rs 7,949.37 crore in the second quarter of the fiscal, chief financial officer Satyan Jambunathan said.

Kannan said the solvency ratio stood at 205.5 down from 210.6 a year ago, while assets under management stood at Rs 1.81 crore, up from Rs 1.65 lakh crore a year ago. For the first time, the share of fixed income products crossed the Rs 1 lakh crore mark.

Kannan said the business more than doubled in Q2 over Q1, showing a gradual recovery in the economy with lifting of lockdowns. "On the back of risk-averse behaviour of customers, we saw considerable interest for traditional long-term savings products which grew 45 percent year-on-year for the quarter, and annuity products grew 73 percent year-on-year for the quarter," Kannan said.

"This gives me the optimism to continue with our plan to double our VNB to Rs 2,600 crore by March 2021, as announced in FY19 when this was only Rs 1,300 crore," he added.

While refusing to quantify claims arising from the coronavirus pandemic, Kannan said the numbers are as per the projections. The insurer sells 43 percent products through banking channels, 23 percent through agents, 20 percent through direct sales to customers and 13 percent from group insurance, Jambunathan said. Shares of the company on Monday closed with a gain of 2.16 percent at Rs 413.50 on the BSE.