Page 18 - Insurance Times July 2023

long-term effects of Covid are not Rs 861 crore bonus announced in FY22.
HDFC Life faces Rs 942-
impacting lives as much as feared, A total of 7,49,229 Participating
crore GST demand ICICI Prudential Life Insurance's MD & Policies are eligible for this bonus.
CEO N S Kannan said. He expects
HDFC Life Insurance has received a “At Tata AIA, we are driven by our core
reinsurance companies, which had
show-cause-cum demand notice value of Consumer Obsession. Our
hiked rates and reduced exposure, to
from the Directorate General of endeavor is to partner our consumers
return with lower pricing.
Goods and Services Tax Intelligence in their financial well-being and this
asking the insurer why a tax of Covid and the surge in mortalities in bonus announcement is a
around Rs 942.18 crore should not the second year of the pandemic had demonstration of our commitment to
be demanded from it. led to many international reinsurers our policyholders in this regard,” Samit
hiking their rates. Some had even Upadhyay, President and Chief Financial
“The matter relates to the claiming
withdrawn from the market in the Officer, Tata AIA Life Insurance, said.
of input tax credit against supply of
wake of the second wave of the
services, which the (tax) authority PNB MetLife also declared its highest-
coronavirus. At the same time, the
believes are ineligible for such ever bonus of Rs 768.6 crore for eligible
pandemic resulted in increased
claims. The company has been policyholders. The insurer said this
awareness of life protection, increasing
advised by its legal and tax counsel bonus is 29% higher than that of the
demand for new insurance policies and
that it has a good contestable case,” previous year and is set to benefit 5.52
improving the persistence of those who
HDFC Life said. lakh policyholders.
had already bought cover.
The company said this is an industry- “The INR 768.6 crore bonus is the
"As far as health outcomes (of the
wide issue and it will be taking highest we have given out till date, and
pandemic) are concerned, there may
appropriate steps in due course to this is a testament to PNB MetLife’s
not be enough research right now. But
reply to the show-cause notice and robust financial performance, sound
in terms of deaths, the mortality
contest the matter. investment strategies, and efficient
variance in our embedded value is
The Mumbai Zonal Unit of risk management practices. It
positive," said Kannan. This means that
Directorate General of Goods and highlights the company’s strong
death claims during the period have
Services Tax Intelligence has sent position and our ability to generate
been lower than expected.
the notice to the private insurer sustainable returns for our
policyholders. This bonus will benefit
pertaining to the period of July 2017
TATA AIA, PNB Metlife to
to FY2022. HDFC Life informed the approximately 5.5 lakh PNB MetLife
HDFC Life: Insurers declare policyholders and enable us to assist our
stock exchanges that it had
clients in building a more secure and
deposited Rs 250 crore under highest-ever bonus for
confident future,” said Ashish Kumar
protest with the tax authority in this
policyholders Srivastava, MD & CEO, PNB MetLife.
matter in the past.
Several life insurance companies have HDFC Life declared its highest-ever
The insurance company also
recently declared their highest-ever bonus of Rs 3,660 crore on participating
informed that Irdai has granted its
bonus for policyholders of participating plans. The bonus was announced in the
approval for HDFC Limited to
plans. Company’s Board meeting held in April
acquire additional shares in HDFC
Life so as to hold more than 50% of Participating or par plans are life 2023. As many as 23.14 lakh
its total share capital. “We wish to insurance policies that provide the policyholders are eligible for this bonus,
inform you that the Insurance policyholder with profit-sharing the company said in a statement.
Regulatory and Development benefits in the form of bonuses. As per the statement, out of the total
Authority of India (IRDAI) vide its Tata AIA Life Insurance has declared a amount of Rs 3,660 crore, Rs 2,696
letter dated June 23, 2023, has bonus of Rs 1,183 crore for crore will be payable to policies in this
granted its approval for transfer of Participating (PAR) policyholders for financial year, as a bonus on maturing
shares of HDFC Life, from HDFC the Financial Year 2022-23. In a policies or as cash bonuses. The
Limited to HDFC Bank in view of the statement, the company said it has remaining bonus amount would be
proposed amalgamation, in terms of been paying bonuses to its eligible payable in the future upon policy
Section 6A of the Insurance Act,
policyholders over the years, and the cessation by way of maturity, death
1938,” it said.
FY23 bonus was 37% higher than the claim or surrender pay-outs.
The Insurance Times July 2023 17