SBI Life Insurance Company Ltd

NSE:SBILIFE

Earnings Call Analysis

SBI Life Insurance Achieves Strong Financial Growth

For the quarter ending June 30, 2024, SBI Life Insurance reported notable results. The new business premium grew by 13%, reaching INR 70.3 billion, while the individual new business premium increased by 17% to INR 47.5 billion. The company maintained its private market leadership with a 21.8% share and saw a 36% rise in profit after tax, totaling INR 5.2 billion. The value of new business (VoNB) grew 12% to INR 9.7 billion, with a VoNB margin of 26.8%. Assets under management surpassed INR 4 trillion, showing a substantial growth of 26% over the previous year.

Introduction and Strategic Initiatives

SBI Life's leadership kicked off the quarter by highlighting their strategic focus on increasing digital adoption and agent productivity. The company's new business premiums grew by 13%, reaching INR 70.3 billion. A large part of this success is attributed to the aggressive onboarding of new agents, the implementation of digital initiatives and innovations, particularly in linked and non-linked products【4:0†source】【4:4†source】.

Digital Transformation

Digital transformation remains at the core of SBI Life’s strategy with a remarkable 99% of their business sourced digitally. This digital pivot isn't just about efficiency; it’s also aimed at meeting evolving customer needs and distinguishing the brand in a competitive market【4:0†source】 .

Premium Growth and Market Share

The company posted a 15% increase in gross written premiums, reaching INR 155.7 billion. Their individual new business premiums grew by 17%, and they maintained a leading private market share of 25.9%. Renewal premiums also saw a 16% rise to INR 85.4 billion, underscoring the company’s strong customer retention【4:0†source】 .

Profitability and Margins

SBI Life reported a profit after tax of INR 5.2 billion, marking a robust 36% growth from the previous year. The value of new business (VoNB) increased by 12% to INR 9.7 billion, with a VoNB margin of 26.8%. However, the company faced a slight compression in margins due to a mix of higher ULIP sales and a tactical decision not to pass on interest rate drops in their non-par savings products【4:0†source】 .

Agency and Distribution Channels

There was significant growth in the agent network, with a 15% increase to 257,266 agents. This growing network contributed to a 27% improvement in agency productivity and a 28% rise in agency business premium. The company also saw meaningful growth across other distribution channels such as online platforms and bancassurance, which contributed a major share of new business premiums 【4:0†source】 .

Product Mix

The product portfolio showed diversification with a solid contribution from ULIP products (58% of individual new business premium). Non-par guaranteed savings products also accounted for 21% of the individual APE basis. Protection new business premium stood at INR 7.2 billion, while credit life premiums grew by 6% to INR 4.7 billion【4:0†source】【4:4†source】.

Operational Efficiency

Operational efficiency saw improvements with the OpEx ratio reducing to 6.1% compared to 6.8% in the previous year. The total cost ratio also decreased slightly to 10.5%. Improvements were noted in the persistency ratio of individual regular premiums, which reached 86.5% for the 13-month persistency and 59% for the 61-month persistency【4:0†source】【4:4†source】.

Regulatory Changes and Customer-Centric Initiatives

SBI Life fully supports the new regulatory reforms introduced by IRDAI, including the implementation of an Internal Ombudsman to enhance customer satisfaction. Despite changes in regulatory guidelines around surrender penalties, the company expects minimal impact on their margins due to their prudent assumption setting and product mix【4:0†source】【4:4†source】 .

Future Outlook

Looking ahead, SBI Life aims for a top-line growth in the higher teens to 20% range. They also expect to maintain a VoNB margin around 28%. With focused strategies on product launches, particularly in protection and digital platforms, the company is well-poised to sustain its growth trajectory【4:0†source】【4:12†source】 .

Earnings Call Transcript 2025-Q1

[Operator]

Ladies and gentlemen, good day, and welcome to the SBI Life Insurance Company Q1 FY '25 Earnings Conference Call. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Amit Jhingran, Managing Director and CEO. Thank you, and over to you, sir.

[Amit Jhingran, executive]

Good evening, ladies and gentlemen. We welcome you all to the results update call of SBI Life Insurance for quarter ended June 30, 2024. We appreciate and thank you wholeheartedly for your time. Update on our financial results can be assessed on our website as well as on the websites of both the stock exchanges.

Along with me present in this room are Mr. Sangramjit Sarangi, President and CFO; Mr. Abhijit Gulanikar, President, Business Strategy; Mr. Subhendu Bal, Chief Actuary and Chief Risk Officer; Mr. Prithesh Chaubey, Appointed Actuary; and Ms. Smita Verma, Senior Vice President Finance and Investor Relations.

I'm pleased to share that we have seen progress in several key areas as compared to previous quarter of corresponding period, demonstrating the strength and dedication of our team work. We are building a strong base for the year ahead by registering growth in banca and agency productivity, onboarding new agents and digital initiatives. This is a testament to the hard work and strategic initiatives we have implemented, ensuring that we not only meet, but also exceed our goals. Moreover, our efforts in new business development have been fruitful. We have seen a notable increase in our new business premium, especially in the linked and products. With higher insurance awareness, there is a positive trend in the insurance industry and higher focus on financial planning and long-term savings.

During the period, 99% of our business is sourced digitally. We will continue our digital initiatives by embracing agility and innovation in meeting the evolving needs of customers in the digital age and fostering brand differentiation. It has been a good start to the year. And during the year ahead, we will continue to accelerate on this momentum, striving for excellence in everything we do. We remain confident of navigating the winds of change ensuring a future where insurance is not just a product, but a pillar of financial security and empowerment for all.

Now let me give you some key highlights for this quarter ended 30th June 2024. Our new business premium registered a growth of 13% over previous period, and it stands at INR 70.3 billion and maintained private market leadership with share of 21.8%.

Individual new business premium stands at INR 47.5 billion with a growth of 17% and private market share of 25.9%. Gross written premium stands at INR 155.7 billion with a growth of 15%. Protection new business premium stands at INR 7.2 billion. Profit after tax stands at INR 5.2 billion with a strong growth of 36% over corresponding period of last year. Value of new business stands at INR 9.7 billion, registering a growth of 12% over last period. VoNB margin stands at 26.8% in for period ended June 30, 2024. Our assets under management has crossed a milestone of INR 4 trillion mark with a growth of 26% in over corresponding period last year, robust solvency ratio of 2.01x as against the regulatory requirement of 1.50x.

We will now update you on each of the key parameters in detail. Let me start with the premium. The growth of Indian insurance industry for the current quarter has re-bounced and has demonstrated a robust performance during the quarter. It grew by 22.9% over previous period. We have successfully maintained our market position amongst private players in individual and total new business premium and have delivered an enduring performance for the quarter. In the year ahead, our endeavor is to continue to maintain and grow our market share as compared to the previous year.

Individual new business premium has grown to INR 47.5 billion with a growth of 17% over last period. Single premium contribution is 36% of individual new business premium, which is mainly attributed to growth in our individual annuity product. If we exclude the annuity business, single premium contribution is at 18% of individual business. The company's private market share stands at 25.9% and industry market share stands at 15.7%. On individual rated new business premium, we stand at INR 32.2 billion with a growth of 21% over last period and maintaining our leadership position with private market share of 22.4% and total market share of 15%.

Also, group new business premium stands at INR 22.9 billion, with contribution of 32% in new business premium and a growth of 6% over last period. Having said that, we have collected total new business premium of INR 70.3 billion. The company's private market share stands at 21.8%, and total market share stands at 7.8%. Renewal premium grew by 16% to INR 85.4 billion, which accounts for 55% of the gross written premium. To sum up, gross written premium stands at INR 155.7 billion with a growth of 15% over corresponding quarter of last year. In terms of APE, premium stands at INR 36.4 billion, registering a growth of 20%. Out of this, individual APE stands at INR 33.1 billion with growth of 22%.

During the quarter ended June 30, 2024, total 4.25 lakh new policies were issued. We remain committed towards the goal of increasing the penetration and achieve holistic growth. Number of lives covered during the quarter ended June 30, 2024, is 4 million. The company is aligned with the regulator's vision of insurance for all and will continue to focus on various reforms, enabling deeper penetration of the life insurance industry. Individual new business sum assured registered a growth of 16% over corresponding quarter of previous years.

Let me give you some details about the product mix. So as on June '24, our guaranteed non-par savings products are contributing 21% of individual APE basis. Individual ULIP new business premium is at INR 27.5 billion, which now constitutes 58% of individual new business premium. Growth in ULIP is attributed to positive movement in equity market and change in customer preferences. Individual protection new business premium is at INR 1.5 billion. Group protection stands at INR 5.7 billion, credit life new business premium has grown by 6% and stands at INR 4.7 billion.

On protection business contribution, 8% of APE stands at INR 3 billion. Retirement plans assist customers in building a substantial corpus of funds to maintain the desired lifestyle and manage expenses in their golden years. Our comprehensive solutions ensure a secure, comfortable and fulfilling retired life for our valued customers. Total annuity and pension new business underwritten by the company is INR 15.4 billion. Annuity business is at INR 11.5 billion and contributes 16% of new business premium. Individual annuity business contributes 90% of total annuity business.

Moving to updates on the distribution partners. With the strength of more than 59,000 CIFs, SBI and RRBs, bancassurance business contributes a share of 63% and on individual APE basis, it stands at INR 20.7 billion with a growth of 12%. SBI branch productivity on individual APE terms stands at INR 3.5 million for the current quarter and registered a growth of 14%. With enhanced focus on agency channel and strategic launch of Agency 2.0, we have made impressive strides in agent activation, agency channel productivity and onboarding of new agents and better collaboration.

Our agent productivity for the quarter stands at INR 1.7 lakhs on individual APE terms, registering a growth of 27% over corresponding quarter of previous year. Agency registered business premium growth of 28% over corresponding quarter of previous year and contributes 21%. Agency channel individual APE showed a growth of 48% over last period and stands at INR 10.7 billion. As on June 30, 2024, the total number of agents stands at 2,57,266, a growth of 15% over previous year. During the quarter ended, the company added a net of 11,188 agents. The share of agency channel in individual rated premium has increased from 27% in previous period to 32% in current period.

During the quarter ended June 30, 2024, other channels that is the direct channel, corporate agents, brokers, online and web aggregators grew by 61% in terms of new business premium and 38% in individual new business. Linked business through other channels registered growth of 89% on APE basis. The share of other channels in new business premium have increased to 28% in current period from 19% in corresponding quarter of previous year. We are focused to strike optimum balance among various distribution channels, and we expect to grow by leveraging these multiple drivers and further strengthening our distribution network.

Now to some updates on profitability. The company's profit after tax for the quarter ended June 30, 2024, stands at INR 5.2 billion with a robust growth of 36% as compared to previous quarter of previous year. Our solvency remained strong at 201% as against regulatory requirement of 150%. Value of new business stands at INR 9.7 billion with a growth of 12% as against INR 8.7 billion in last period. VoNB margin stands at 26.8% for the period ended June '24. The shift in VoNB is mainly on account of increase in share of ULIP business as compared to previous period and for a specific period in non-par savings, the impact of yield movement was absorbed by the company instead of being passed on to the customers.

Talking of operational efficiency. OpEx ratio stands at 6.1% for the quarter ended June 30, 2024, as compared to 6.8% for corresponding quarter of previous year. Our total cost ratio will stand at 10.5% for the period ended June 30 as compared to 10.8% for corresponding quarter of last year. With respect to persistency of individual regular premium, 13th-month persistency stands at 86.5%, with an improvement of 150 basis points. 61st month persistency stands at 59.0% with an improvement of 229 basis points. As mentioned in my opening remarks, assets under management stand at INR 4.15 trillion as at June 30, 2024, having a growth rate of 26% as compared to June 30, 2023.

Death claim settlement ratio stands at 98.7%. The company has registered an improvement of 107 basis points over last year. At SBI Life, an unwavering commitment to our customer-centric approach remains at the heart of everything we do. Our mis-selling ratio stands at just 0.04%, which is lowest in the industry. To further strengthen it and keeping customer at the center stage in order to better address the customer grievances, we have created the position of Internal Ombudsman and appointed an industry veteran to set a new benchmark in customer satisfaction. This is first in the entire insurance industry.

We are committed to delivering need-based solutions that address the ever-evolving customer needs based on customer profile, life stage and goal prioritization. The company continues efficient usage of technology for simplification of processes with 99% of the individual proposals being submitted digitally. 42% of individual proposals are processed through automated underwriting. We have aligned our business strategies with IRDAI vision and other regulatory initiatives, emphasizing the importance of consumer empowerment in driving growth of the industry. IRDAI has issued a master circular on life insurance products that encompasses a series of forward-thinking reforms aimed at enhancing the efficiency, transparency and overall functioning of the insurance sector.

These reforms are designed to foster innovation, improve customer satisfaction and ensure the stability and growth of the industry. Measures like increase in special surrender value, increase in free look cancellation period, loan against policy for all nonlinked savings products offering surrender value and robust processes to address customer grievances will further increase insurance penetration. We, at SBI Life, fully support these initiatives and are committed to aligning our operations with the new regulatory framework. We believe that these changes will bring about a positive transformation in the insurance industry, benefiting all stakeholders involved.

To conclude, by fostering a culture of resilience and continuous improvement and with our expanding multi-distribution network, committed team members and best-in-class customer service, we are confident of our ability to navigate the future and maintain our position as a trusted leader and preferred market player. We will continue to focus on long-term sustainable and profitable growth.

Thank you all. And now we are happy to take any questions that you may have.

[Operator]

[Operator Instructions] The first question is from the line of Avinash Singh from Emkay Global.

[Avinash Singh, analyst]

A couple of questions. The first one is more around what will be your strategy around protection income passing both the retail protection and credit life? Because I mean, on the credit life side, you have a large bank like SBI, as a partner, and also on the retail side, you have a big reach. But I mean, since last almost more than a year, protection somehow seems to be losing momentum at least on a relative basis to savings. So what is going to be the strategy to sort of improve protection, say, in the product mix, particularly the retail protection and credit life. GTI, I'm separating for the moment. So that's the first question.

And the second question, if you can sort of outline your strategy or plans around product design or the commission tweaking post September 30, once this new product has to be sort of a file, where you have this enhanced special surrender value, so what are your thoughts on sort of an impact in terms of how we're going to deal with balancing the margin, payout to the customers at the same time the commission payouts?

[Amit Jhingran, executive]

So taking your protection question first, there was a slight blip during the quarter in the protection sales as we saw in the results. And that was basically, I think, was being driven by more demand of ULIP products in the market depending on the returns that are being generated through ULIPs and natural attraction of the customer segment for these higher returns. But having said that, being in the insurance industry, protection remains very important and this is on top of our mind also.

To improve the protection business, we have gone into a huddle with our main banca partner, SBI, and depending on the data analytics of SBI on its database, we are going to offer a product very soon on the digital platform of the State Bank of India that is YONO. And this will be a simpler product with 3-click kind of issuance based on the data analytics and preapproved kind of sum assured with very competitive rates. And being on the digital platform, the journey will be very easy for the customer. The rates will be very competitive and we expect a very good response through this particular product.

In addition to that, we are also designing a product for the ultra-HNI kind of segment where higher sum assured is needed. And this product should also be launched sometime during the month of August and we expect to garner a good business out of this high sum assured product also. Of course, underwriting, offering higher nonmedical limits and simplified medical procedures also are being introduced to improve the individual protection business. The group protection, of course, has shown some growth, and we expect that with the property market in boom, the group protection business, especially with the banca partner, will definitely show further growth during the year.

Coming to your second question about the strategy and plans, we have maintained that the new customer-centric approach of IRDAI, the better surrender value and all to the customers, SBI Life being the lowest cost operator, and also because of the kind of product mix that we have at SBI Life, we will be the least affected company. And as of now, we are not planning any commission structure change for our corporate agents or for our individual agents. And the rate structure will also continue to be the same.

[Avinash Singh, analyst]

Okay, sir. Just on first part, on credit life. Do you have any plans to sort of meaningfully improve traction beyond home loans? Because I mean, SBI, of course, are pretty big in auto loan, even in personal loan, they're reasonably big. I mean, are you looking to sort of increase penetration of credit life in auto loan customer or personal loan customer or is the home loan going to be the core area?

[Amit Jhingran, executive]

Home loan continues to be the largest portfolio for the bank also, and we see good value increasing penetration there. In addition to that, with these new protection products also on individual basis as well as on the group term basis, we will be targeting the education loan customers. So for these young customers, the protection will be priority and we will try to cover them through group or through individual products.

[Operator]

The next question is from the line of Nischint Chawathe from Kotak Institutional Equities.

[Nischint Chawathe, analyst]

I'm not sure if I really understood the reason for year-on-year decline in margins. As I understand your margins in ULIPs, at least in the past, you had kind of highlighted at higher than margins in the par book. So what has driven the compression in margins?

[Unknown Executive]

Nischint, the main thing is our protection has not grown to the extent we wanted. That is one of the key reasons why our margin has gone down. And in opening remarks, MD, also stated that for a short while, the drop in interest rate was not passed on to the customer. That is also -- so there is some -- of course, non-par remains high-margin products. But within non-par, our margins have gone down comparatively slightly compared to last year because we did not pass on the drop in interest rate to customers. So it's a combination of product mix, slightly higher ULIP sale and these 2 factors, which have caused a decrease in margin.

[Nischint Chawathe, analyst]

So slightly higher ULIP sales should have actually lifted your margins and you are saying that these 2 components probably more than offset that and which is the reason why your margins are down?

[Unknown Executive]

Correct, correct.

[Nischint Chawathe, analyst]

And if I look at purely the savings vertical versus protection vertical margin, is the savings vertical margin kind of almost stable or gone up? Or how should one think of it?

[Amit Jhingran, executive]

They are almost stable.

[Nischint Chawathe, analyst]

Okay. So then practically, it's only the protection in which you probably have around maybe 60%, 70% margin on individual protection, which is -- I mean, practically driving all the difference in numbers this quarter?

[Amit Jhingran, executive]

Yes. So I mean, directionally correct, we will not comment on the amount, I mean, the numbers.

[Nischint Chawathe, analyst]

Sure. And just one more thing is on the regulatory side, there have been quite a few changes. Anything else that we are now really envisaging at this stage?

[Amit Jhingran, executive]

So we have always stood by the changes that the regulator brings in because we firmly believe that whatever is being done by the regulator is to ultimately benefit all the stakeholders in the industry, be it customers, be it the insurance companies or the distributors. So whatever comes in, we are ready to implement that. And in fact, we have gone ahead, if you noticed during my comments, I said that some of the customer-centric approach like the introduction of Internal Ombudsman in the company, that is for the first time in insurance industry that we are doing that. So all the customer favoring decisions of regulator, we fully stand by that.

[Nischint Chawathe, analyst]

And because of the surrender penalty guidelines change, what could be the impact on margins? Because I think you mentioned somewhere that you're going to absorb it and not to really share it with the distributors?

[Unknown Executive]

Not much, Nischint. As you know, our product mix is not -- more -- is [indiscernible] based on the non-par. Secondly, we always used to be very prudent in terms of setting our assumptions. Our surrender value is higher than the regulatory requirement, so we don't penalize the customers. Our approach in the pricing the product is to ensure consistency, continuity in terms of what returns we're offering to the current policyholder and things. We're not banking our return based on the surrender penalty coming from there. So to that extent, there is very less impact. Only impact will be coming on the year 1, our assumptions, our experience is also very low. So we don't see much impact will come on that prospective.

[Nischint Chawathe, analyst]

Sure. And just finally, any guidance that you want to give for the growth for the financial year?

[Amit Jhingran, executive]

So we stand by the guidance that we gave during the end of the last financial year results. Our top line growth will be in higher teens to 20%. And regarding the margin also, we will be in the same range of plus/minus 28% kind of...

[Operator]

The next question is from the line of Prayesh Jain from Motilal Oswal Financial Services.

[Prayesh Jain, analyst]

A couple of questions. Firstly, on commission costs that have gone up, what could be the reason for that? Secondly, there is a slowdown in annuities as well, could you highlight the reasons of that? What is the outlook there?

[Unknown Executive]

For the commission part, as you know, we have provided as required under the expense of management guideline, which was not there in the last year's first quarter. That is the reason, there is a little spike shown in the current quarter. And as far as the annuity is concerned, we have been very focused on the individual annuity. And group annuity, this is coming based on the transactions which you do over a period of time. So which are in pipeline. So we expect that annuity will also pick up overall for the financial year in the next few quarters.

[Prayesh Jain, analyst]

Okay, okay. And just lastly, on the surrender charges, you are saying that if your product mix remains the same and the new products are launched from October, your margins would not be impacted. Is that a fair assumption to go with?

[Unknown Executive]

We are saying that there will be very minimal impact? We can't see there will be no impact, but looking into our product mix and the way we -- surrender value that we're currently offering, there will be much -- minimal impact will come on our margins -- on overall margin for the company.

[Prayesh Jain, analyst]

Then how do we kind of come to plus/minus 28% margin guidance that you have given, then how can we -- if the second half margins are likely to be lower, would be impacted by this, then how do you arrive at the guidance of 28%?

[Unknown Executive]

So we are saying that products will improve, and that will compensate for the loss in margin that you are seeing in the first quarter.

[Operator]

The next question is from the line of Shreya Shivani from CLSA.

[Shreya Shivani, analyst]

I have 2 questions. First is on the banca channel. SBI channel, I know in last couple of quarters also, they were slow. Is there -- but in general, the trend for this channel last year through the fourth quarter was of [ slight growth. ] I mean, it didn't decline, but the growth sort of slowed down. So has there been any updated SBI stance over insurance or anything that you can share on that? Second is on the competitive landscape. Sir, In terms of your figures after last year's taxation change [Technical Difficulty] Tier 3, 4 geographies, which is your home turf in a way. So are we seeing any increased competition in your geographies, any color you can give around that?

[Amit Jhingran, executive]

So if you are following company's results, you would have noticed that there is a very strong seasonality, especially in the banca channel. After a very robust December quarter, our growth in March quarter for the banca channel was flat, in fact, a little negative. But if you notice the numbers for June we are back on the growth path. So although it is in the lower double digit, but the growth is back. And second and third quarter usually are stronger for banca and we expect that we will be back on the same growth path in banca again.

[Unknown Executive]

The second one, I think you referred about the Tier 2, Tier 3 cities for change in that. So as you know, we have been very strong on the Tier 2, Tier 3 cities, almost kind of 48% to 50% of our business comes from these regions and the presence of SBI across geographies in this particular regions are very high. So we don't see much competition per se from any quarter, and we will try to enhance our penetration more on these regions to take the target, which we have planned for the company.

[Shreya Shivani, analyst]

Sure. So even incrementally right now, you're not seeing any increased competition or is that what you're trying to indicate?

[Amit Jhingran, executive]

You can see that the industry is having very robust growth. So there is enough in the market for all the players to take in. We won't say that we are being affected by the competition in any major way.

[Operator]

The next question is from the line of Supratim Datta from AMBIT Capital.

[Supratim Dutta, analyst]

So my first question is on the agency channel. Now the agency channel has been growing fairly strongly and one of the key drivers behind that has been the number of agents that you have been adding over the last few years. Just wanted to understand that how sustainable is this agent addition? And do you have a target -- annual target about how many agents you would like to add every year? So that would be my first question before I come to my second question.

[Amit Jhingran, executive]

So as you would have noticed in my address, I talked about our agency -- strategic initiative of Agency 2.0, what we are calling it internally in the company. And as you yourself said that you have been noticing the agent accretion during last few quarters in the company. And the first quarter growth in agency business is the result of the addition of these agents over previous quarters. As we recruit the agent, it takes some time to mature and increase the productivity. And we are now noticing that increase in productivity of our agents and the consequent growth in agency number. Agency almost grew by 43% on IRP basis. And that is the kind of growth we are looking for in the current year, so that our overall distribution mix, the contribution of agency is slated to go up.

[Supratim Dutta, analyst]

Got it. Understood. And could you give us a sense how the margins across the different channels are typically? Would the agency be a higher or a lower margin channel as compared to banca and the other channels? If -- do you have -- could you give us some sense around that?

[Amit Jhingran, executive]

So we don't diverge the distribution channel-wise margins for the products as such. So that is the company strategy and that is how we want to continue in the current year also.

[Supratim Dutta, analyst]

Got it. Understood. And lastly, I understand that you have indicated that in the second and third quarter, the growth typically picks up. But if I see that in the second and third quarter, you're cycling fairly strong growth over the last 2 years. If I see on a 2-year basis, both quarters, you are cycling fairly strong growth. So could you give us a sense that will this growth that you're targeting going to come from new product launches or are there other strategies at play that we will focus on in the second and third quarter, which will result in the growth acceleration?

[Unknown Executive]

So we will have some segment-specific product launches to drive growth in protection, which we mentioned earlier. And we do believe that certain initiatives on digital platform of the bank that are underway. We fructify in this quarter, that is quarter 2 of financial year and our normal activity level in bank, all 3 of them will result in higher sales in banca channel.

[Operator]

The next question is from the line of Dipanjan Ghosh from Citibank.

[Dipanjan Ghosh, analyst]

A few questions. First, if you can give some color on the business growth in the other channel, which is non-agency, non-SBI? What are the underlying constituents in terms of both product and which is the fastest-growing subsegment within that particular segment in terms of the channel mix? Second, you mentioned on the protection product pipeline, but is there any other products that is expected to be launched in the next 3 quarters? And also will you be refiling your credit before 1st of October? And if so, what would be the new computes? Are you planning for any changes? And you mentioned you won't be tweaking the commission structure, but is there going to be any other product structure tweaking that you kind of would be doing?

And lastly, you have grown -- I mean, we have seen some dichotomy in the non-par growth that we've seen across all the players who have reported till now and you have reported a 20%-plus-or-so Y-o-Y growth. I just wanted to get some color on the policy growth versus the ticket size growth or the quality of customers who are really buying this policy?

[Unknown Executive]

I will take the question on the other channels, and Pritesh will answer on the product. So on the other channels, it's a mix of PSU bank partners we have, non-PSU bank partners we have, brokers, online channel and direct channel, all, everything. So we have seen good growth in the online channel and good growth in some of the partners that we have. There has been a subdued growth in some of the bank partners we have. So net-net, it is -- there is -- what we expect is the bank partners, which have shown subdued growth will come back in quarter 2, quarter 3, quarter 4, and we will continue to show robust growth in our online channel. That is our expectation.

And in this channel, depending upon the partner, the product mix keeps varying. So in some partners, the share of -- some channel share of protection and par, non-par is very high. In some other channels, we are offering only NPS like products, so there is a different color. Partner-by-partner analysis will have to be done in terms of product mix for this channel. On the product structure and -- Pritesh will mention on the launch.

[Prithesh Chaubey, executive]

On the product side, what MD sir has also mentioned that we will be launching a term plan for the ultra HNI customer, also for the bank. What we're doing there, we're also looking into revamp our par portfolio. So you see a few products we are working on, on the par business. We're also coming out of the par on the non-par. And as we mentioned that we're adopting the segment-wise approach, so we have a different geography, different kind of customers, trying to understand their need and come out with a product with them suitable to their profile, demographic profile and their income profile. What we identified another child segment is a growing segment of the country. So we will be revamping the product from child segment and we'll see the planning to introduce child part in all 3 major segments, par, non-par and platform.

So -- and in addition to that, we are revamping our rider portfolio. So this month, month of August, we will be launching the rider and there are other few protection riders in pipelines. Objective is to give the complete solution to the customer and we hope that will help us not only to meet the need of the customer, but also help us to improve the growth and -- along with improvement in the our margin.

[Dipanjan Ghosh, analyst]

All right, sir. And on the -- any expected refiling of credit prior to 1st October?

[Prithesh Chaubey, executive]

Yes. We will. So we have plan and we are going to reprice and refile all this par in the phased manner, not limited to filing on the 30th September. So in gradual manner, we'll file these products.

[Dipanjan Ghosh, analyst]

Got it. And sir, just a [indiscernible] question. If you can give the credit protect APE for the quarter?

[Unknown Executive]

Credit product APE is around INR 47 crores.

[Operator]

The next question is from the line of Aditi Joshi from JPMorgan.

[Aditi Joshi, analyst]

So 2 questions from my side. Sir, firstly, on the composite licensing thing. So are you still expecting that this composite licensing might come into play? And then if it actually takes into effect, then what sort of benefits can you reap out of it? And from a channel perspective, again, from a composite licensing perspective, which will be your key focus of channel in terms of distribution?

And second, on the agency side, do you have any particular product mix on that particular distribution channel in terms of what products you would like your agency to sell because in this quarter, we saw that the ULIP growth was pretty much higher even in the agency side. But going forward, do you think that we might see some higher share of, let's say, protection products coming in from that side? And just lastly, on this new high net worth higher sum assured products that you mentioned, which distribution channel are you focusing on for this product segment?

[Amit Jhingran, executive]

Okay. So composite licensing is in the talk for almost last more than a year-or-so and regulator and government have to take a call on that. But having said so, the contours of business in life and general insurance are very different, but have some synergies also. The risk, the asset liability management, everything is quite different, but the distribution channel and certain other things, there are synergies. So it has its pros, it has its cons. As far as SBI Life is concerned, our parent bank has a company in life insurance and there is a separate subsidiary, which looks after the general business. So as and when the composite licensing is introduced, the parent will take a call depending on the market condition, and we will be guided by the parent bank in this regard.

Regarding the agency channel, we do not offer differentiated product from agency and banca channel. Products are common. And the other features are also common to both the channels. The current growth in agency channel is basically being driven by our increased focus, improving infrastructure, opening more number of branches, employing more agent, and focusing on the per agent productivity, which happens to be one of the highest in the private sector industry. So going forward, we will continue to focus on the agency channel. Your third question about the ultra HNI product, we will be focusing on our direct channel as well as banca and agency channel both because we are simplifying the underwriting processes. We are going to give higher nonmedical kind of facility also in protection business, and these will be uniform across the channels.

[Aditi Joshi, analyst]

Got it. And can I just make a quick follow-up question? On your comment that going forward, we will be focusing on riders as well. So is it going to be higher rider attachment on the ULIP products as well? So what sort of products will we have this attachment in the rider?

[Prithesh Chaubey, executive]

So our objective is to make this rider available to all line of business. So it will be available to the par, non-par as well as leading products. So this is all products. And we expect that the more and more offering we'll have in the rider side, it will give opportunity to customer to fulfill their needs. And hence, there will be a lot of expectation that our advertisement rider attachment will go up.

[Operator]

The last question is from the line of Sanketh Godha from Avendus Spark.

[Sanketh Godha, analyst]

Sir, it's the same question on bancassurance channel. See, our APE growth is just 12 percentage in the banca that is SBI channel. So if you are guiding for 18% to 20% kind of a growth for the full year, then the expected growth from the banca channel should be at least 15% to 16% for the full year if the momentum in the agency remains at the current level. Sir, just wondering whether if it is 12%, then in the next 9 months, you are expecting a growth of around maybe 18%, 19% in the banca channel. Are you fairly confident that 18% to 19% kind of growth will happen to deliver that mid-teen -- high-teen to 20% kind of a growth, what you have guided for APE? That's the thing. And what will lead to it? I understand the seasonality part, but I just want to understand that part a little better.

And second is that -- I mean, you did not quantify -- you said there is a marginal impact, you did not quantify the number. But assuming this current product mix remains true for the entire year, maybe how much that impact would be maybe less than a percentage or 50, 60 basis points? Means, if you can give a ballpark number, assuming the current product mix will remain true, what will be the likely impact on the margins because of the surrender norms? Yes, those are my questions.

[Amit Jhingran, executive]

You yourself answered what you asked for that the 12% growth rate is based on the seasonality in the banca channel. The March quarter growth rate was almost nil. It came back to 12%. Second and third quarter are usually strong for banca. And in addition, we are expecting good business in the production segment, the digital products that we are going to offer on the YONO channel. We have very high hopes because it is a much simplified product with a lesser premium, and we expect very good growth in this also.

The strong growth in ULIP is continuing, so that also in second, third quarter will provide us good growth opportunities. And pushing it from 12% to the number you yourself said, around 15%, 16%, that is not much of a difference. We are very sure, very sanguine that the kind of 18%, 20% growth guidance that we are giving, we will be able to stick to that.

[Sanketh Godha, analyst]

Got it. And if you can quantify the bps impact on the margins with the current product mix?

[Unknown Executive]

We will not exactly quantify, but this will definitely be much lesser than the 1% number that you quoted.

[Sanketh Godha, analyst]

Okay. And lastly, if I can squeeze in one? See, even your group protection has slowed down, I understand -- group annuity has slowed down, I understand, which could be tactical based on this -- the -- means when the corporates will do it. But even individual number, individual annuity seems to have declined 10% year-on-year. So anything to read there? Is it because of the IRR pressure, competitive pressure or the competition has launched more and more customer-friendly products and that is leading to a bit of slowdown in individual annuity?

[Unknown Executive]

Sanketh, there are 2 things to it. Credit life, as of today, it is growing at 5%. But as MD has already mentioned that there is a big uptake on the semi-loan side because of the various things going on in the economy. So we expect that the credit life will grow better than what we have seen in the quarter. Second, as far as the GTI businesses are concerned, it is a business which is getting negotiated during the course of the year. And we expect that certain transactions will fructify during the next 2, 3 quarters and we'll definitely get as desired for us in the current financial year.

And as far as the annuity is concerned, it is a bulky business, and we don't have much pressure as far as the pricing is concerned. But we will see what is the beneficial for us as far as the VoNB accretion is concerned. If it is a positive VoNB, definitely, we will be going forward for the larger deals in the coming quarters. So overall, we expect that the group from the credit life as well as from the group annuity will go up in the coming quarters.

[Sanketh Godha, analyst]

Sir, my question was on individual annuity, which has also declined by 10%. Is there any pressure there in that thing?

[Unknown Executive]

No. It is -- it has subdued this quarter, but our rates are quite competitive, and we expect that this will bounce back in the coming quarters to come.

[Operator]

Ladies and gentlemen, we will take that as the last question. I would now like to hand the conference over to Mr. Amit Jhingran, Managing Director and CEO, for closing comments.

[Amit Jhingran, executive]

So thank you very much, everybody, ladies and gentlemen, for the time and the queries and the interest shown by all of you. You may get in touch with our Investor Relations team in case you have any follow-up questions at any point of time. Thank you. God bless.

[Operator]

On behalf of SBI Life Insurance Company, that concludes this conference. Thank you for joining us and you may now disconnect your lines.