ICICI Prudential Life Insurance Company Ltd
Directors Reports
TO THE MEMBERS
ICICI Prudential Life Insurance Company Limited
Your Directors have pleasure in presenting the 23rd Annual
Report of ICICI Prudential Life Insurance Company Limited (the Company) with the audited
statement of accounts for the year ended March 31, 2023 (FY2023).
PERFORMANCE Industry in FY2023
During the financial year 2023, global economies recovering from the
COVID-19 pandemic witnessed another hindrance in the form of a geopolitical conflict which
caused significant pricing pressures across economies including India. This resulted in an
increase in commodity and energy prices globally, thereby increasing inflationary
pressures across most economies including India. COVID-19 restrictions in China as well as
geopolitical conflict continued to pose supply side challenges. However, with the
calibrated approach of Reserve Bank of India and effective measures taken by the
Government of India, the Indian economy was able to gain pace through the rest of the
financial year. In this context, the new business Retail Weighted Received Premium (RWRP)
for the industry increased by 18.7% from Rs. 875.73 billion in FY2022 to Rs. 1,039.56
billion in FY2023. The market share of private players increased from 62.9% in FY2022 to
65.8% in FY2023.
Company in FY2023
Our objective continues to be that of creation of value for our key
stakeholders, namely, customers, employees and shareholders. Customer-centricity continues
to be at the core of everything we do. We offer a well-diversified product suite through a
multichannel distribution architecture catering to a wide range of customer segments as
well as customer needs. With this customer-centric approach, we have had a robust
performance across various customer service parameters. Our claim settlement ratio for
individual death claims was 95.3% for FY2023. The overall claim settlement ratio
(inclusive of individual and group death claims) was 98.7% for FY2023. Average time taken
for settlement of non-investigated retail death claims stood at 1.2 days in FY2023. Our 13th
month persistency ratio1 improved from 84.6% in FY2022 to 85.4% in FY2023,
which was the highest in the last five financial years. Our 49th month
persistency ratio1 improved from 63.4% in FY2022 to 63.9% in FY2023, which was
the highest in the last five financial years. Our grievance ratio stood at 59 per 10,000
new business policies issued for FY2023.
Alignment between our business and people strategy and the consistent
investment in the growth and development of our employees have helped us make our human
resources a source of our strength and a key competitive advantage. The focus of our key
people imperatives in FY2023 has been to:
Strengthen Capacity through talent attraction and robust
onboarding,
Develop Capability to enable future-ready talent, and
Enable a Culture that delivers our employee value proposition of
providing a Supportive Environment, providing Learning & Growth and ensuring Fairness
& Meritocracy In alignment with the business strategy, the Company has augmented
capacity for risk-calibrated growth & profitability and invested in core roles as well
as innovation-centric roles. This is supported through a robust capability development
framework that involves structured learning interventions, skill mapping &
professional certifications, on the-job training, job rotation, management development
programs and self-paced virtual learning platforms. A well-defined performance &
talent management system ensures clarity of purpose across levels and alignment to the Key
Performance Indicators of the Company. In addition, it also helps create a talent pipeline
by nurturing high-potential talent and enables differentiated rewards to help ring-fence
talent.
Key elements of our culture include aligning employees to key
organisational imperatives, fostering diversity & inclusion, enabling holistic
employee well-being, crowdsourcing innovation and coming together & celebrating. In
addition, mechanisms are in place to listen, empathise and respond to employee feedback
through employee surveys leading to a periodic review of employee policies, processes
& benefits; as well as a robust grievance redressal mechanism to ensure all employee
concerns are addressed.
The people strategy has enabled the Company to have leadership
stability, with 82% of the senior management team having served the Company for more than
ten years, leadership depth with 96% of senior management having done more than three job
rotations, and leadership cover with 97% of key positions at leadership levels having
adequate / moderate leadership cover.
For our shareholders, we delivered on the objective of doubling the
FY2019 Value of New Business (VNB) in FY2023, with a four-year compounded annual growth
rate of 20.1% and industry leading margins of 32%. The path taken to achieve the VNB
doubling objective was to transform ourselves in the last four years from being a Company
focused on ULIPs, distributed primarily through a single channel and catering mostly to
affluent individuals in top tier cities to an organisation offering well-diversified
product suite distributed through multichannel architecture catering to a wide range of
customer segments as well as customer needs. In FY2023, the Company has a diversified
product mix, channel mix and most importantly, the power of a large customer base spread
across various income segments. This four-year transformation journey has resulted in well
diversified pools of profit, thereby helping us reach our stated objective of doubling of
FY2019 VNB. Our primary focus continues to be to deliver growth of absolute VNB through
the 4P strategy of Premium growth, Protection business growth, Persistency improvement and
Productivity enhancement, while keeping customer centricity at the core. We continue to
integrate aspects of Environmental, Social, and Governance (ESG) into the management of
our business as well. We believe that this 4P strategy is appropriate in the context of
the large insurance opportunity in the country, a facilitative regulatory regime and
coupled with our objective to grow absolute VNB.
Premium growth: The Annualised Premium Equivalent (APE) for the Company
increased by 11.7% from Rs. 77.33 billion in FY2022 to Rs. 86.40 billion in FY2023. Our
new business received premium grew by 12.5% from Rs. 150.36 billion in FY2022 to Rs.
169.22 billion in FY2023. In FY2023, the Company had a market share of 7.2% based on RWRP.
Protection business growth: The Company continued its focus on the
protection business, resulting in a new business sum assured growth of 34.7% to Rs. 10.4
trillion in FY2023. The Company's market share based of new business sum assured has
increased from 13.4% in FY2022 to 14.3% for FY2023. Retail protection business registered
sequential growth for Q2-FY2023, Q3-FY2023 and Q4-FY2023, as well as a year-on-year growth
for Q4-FY2023. The Company has continued to leverage the growth opportunity in group
protection business in FY2023 as well. As a result, the overall protection APE saw a
growth of 14.5% from Rs. 13.13 billion in FY2022 to
Rs. 15.04 billion in FY2023.
Persistency improvement: For FY2023, our persistency ratios1
for 13th month and 49th month stood at 85.4% and 63.9% respectively.
Our retail renewal premium stood at
Rs. 223.77 billion in FY2023. Our assets under management stood at Rs.
2.5 trillion at March 31, 2023.
Productivity enhancement: Total expenses increased from Rs. 53.63
billion in FY2022 to Rs. 64.75 billion in FY2023. The absolute expenses are higher as
compared to the same period last year due to investments made to deliver sustainable
future growth. The cost to total weighted received premium (TWRP2) ratio
increased from 18.6% in FY2022 to 21.5% in FY2023. Also, the cost to TWRP ratio for
savings business stood at 14.2% in FY2023.
Resilient Balance Sheet: The Company has maintained a strong and
healthy Balance Sheet throughout its journey. Only 0.3% of the fixed income portfolio has
been invested in bonds rated below AA and the Company continues to maintain its track
record of not having a single non-performing asset (NPA) in its fixed income portfolio
since inception.
Value of New Business (VNB): The outcome of our focus on 4Ps has
resulted in our VNB for FY2023 of Rs. 27.65 billion, a growth of 27.8% over FY2022.
Embedded value increased from Rs. 316.25 billion at March 31, 2022 to
Rs. 356.34 billion at March 31, 2023.
A summary of key financial and business parameters is set out below: (
billion)
Particulars |
FY2022 |
FY2023 |
New business premium |
150.36 |
169.22 |
Annualised premium equivalent |
77.33 |
86.40 |
Savings |
61.20 |
66.29 |
Protection |
13.13 |
15.04 |
Annuity |
3.00 |
5.07 |
Sum assured for new business |
7,731.46 |
10,413.92 |
13th month persistency1 |
84.6% |
85.4% |
49th month persistency1 |
63.4% |
63.9% |
Retail renewal premium |
214.36 |
223.77 |
Cost to total weighted received premium (TWRP)2 |
18.6% |
21.5% |
Cost to TWRP (savings) |
12.8% |
14.2% |
Value of new business |
21.63 |
27.65 |
(VNB) |
|
|
Embedded value (EV) |
316.25 |
356.34 |
Outlook for the industry and the Company
The size of the Indian life insurance sector was Rs. 6.9 trillion
(Source: IRDAI, Annual Report 2021-22) on a total premium basis in FY2022, making it the
ninth largest life insurancemarketintheworldandthefourthlargestinAsia (Source: Swiss Re
sigma No. 4/2022). The total premium in the Indian life insurance sector grew at a CAGR of
~14% between FY2002 and FY2022. Based on retail weighted received premium (RWRP), new
business premium of the industry has grown at a CAGR of ~11% during FY2002 to FY2023. This
growth can be attributed to efforts toward financial inclusion, rapid digitalisation of
financial services powered by high penetration of the internet in the country, rising
middle class disposable income, increasing awareness towards retirement planning &
long-term savings, push by government incentives on various instruments etc. The life
insurance penetration of the country has increased from 2.1% in FY2002 to 2.9% in FY2022
(life insurance premium measured as a percentage of gross domestic product). Although the
life insurance industry has grown manifold over the last two decades, there is still a
huge opportunity to grow further and expand the outreach, with the larger objective of
increasing the insurance penetration and improving the insurance density of the country.
Given this immense opportunity, a facilitative regulatory regime coupled with India's
demographic factors such as a growing middle class, young insurable population, growing
awareness of the need for protection & retirement planning, rapid rise in urbanisation
and increasing financial savings are expected to aid the growth of the life insurance
industry in India.
The Company would continue to focus on its objective of growing value
of new business (VNB) through the 4P approach.
Premium growth: The Company would endeavour to grow premium through:
Deepening penetration in under-served customer segments: The
Company would continue to focus on broadening the customer base through initiatives
spanning across both distribution and products.
Enhancing distribution: The Company would strengthen its
distribution through a closer mapping of distribution segments with customer segments and
products. The Company is also focused on expanding the distribution network through
acquisition of new partners as well investing in creation of new sourcing channels.
Focus on pension & annuity: The Company would continue to
cater to the retirement savings need of customers while managing the investment risk
appropriately.
Protection business growth: The Company is focused on expanding the
health & protection business across both retail and group lines of business. This
would be done by offering protection products across channels, penetrating the online term
insurance market and partnering with loan providers to offer coverage against loans.
Persistency improvement: The Company would seek to drive persistency improvements across
all durations by encouraging long term behaviour in customers.
Productivity enhancement: The Company would focus on cost efficiency
and in particular, would leverage the digital platform to improve customer experience and
efficiency of service operations.
Our Reach
The Company reaches its customers through 471 offices in 408 locations
as of March 31, 2023. On March 31, 2023, the Company had 17,825 employees and 201,472
advisors to cater to the needs of customers. The Company distributes its products through
agents, corporate agents, banks, brokers, proprietary sales force (PSF) and online
channels. The Company's digital platform (website and mobile application) provides a
seamless, convenient and immersive experience to its customers, be it for product
explorations, purchase, service requests or claims. The digital platform supports ~3.4
million service interactions every month with more than 92.5% of the Company's
service interactions done via self-help/digital modes. As on March 31, 2023, there have
been over 1.5 million mobile application downloads.
Products
Broadly, the Company's products can be categorised into savings,
protection and annuities. Savings products are offered on three platforms - linked,
participating and non-participating.
These plan offers life cover as well as savings which is paid either in
lump sum in form of regular stream of income. Protection products are available on retail,
group and credit life platforms. These products provide cover for life, disability,
critical illness and accidental death. Annuity products are available on retail and group
platform. These products provide a regular stream of guaranteed income.
Claims
The Company settled over 246,273 mortality claims amounting to a total
of Rs. 38.51 (Individual Rs. 19.50, Group
Rs. 19.01) billion in FY2023 with individual claim settlement ratio of
95.3% and group claim settlement ratio of 98.9%. The overall claims settlement ratio with
individual claims and group claims is 98.7%.
Further, the Company has also paid 99,105 maturity
claimsfromitsretailbusinessoperationsandover200,000 survival benefit claims amounting to
Rs. 38.84 billion and Rs. 5.53 billion, respectively for FY2023. Additionally, the Company
has settled 347,061 surrender claims from its retail business operations and 129,510 from
group business, amounting to a total of Rs. 236.35 billion. For non-investigated retail
death claims, the settlement was completed within an average turnaround time of 1.2 days
from the receipt of the last requirement as compared to thirty days allowed by the
regulator.
Subsidiary
The Company's wholly owned unlisted subsidiary, ICICI Prudential
Pension Funds Management Company Limited (PFM) acts as a pension fund manager under the
National Pension System (NPS) with an objective of providing a strategic platform to
leverage the substantial pension opportunity in India. Further, the PFM is also registered
to serve as a Point of Presence (PoP) entity for distribution of NPS products and
servicing.
During FY2023, the subscriber assets managed by PFM increased by 41.8%,
from Rs. 116.14 billion at March 31, 2022 to Rs. 164.66 billion at March 31, 2023.
Additionally, the PFM enrolled 137,063 new subscribers during the year. PFM continued to
be profitable for a second consecutive year. The profit before tax decreased from Rs. 0.04
billion in FY2022 to Rs. 0.03 billion in FY2023 primarily on account of increase in
employee benefit expenses and expenses incurred for building capacity to support future
growth. The profit after tax of the PFM decreased from Rs. 0.05 billion in FY2022 to Rs.
0.03 billion in FY2023. The profit after tax in FY2022 includes the recognition of a
deferred tax asset arising from carried forward losses and unabsorbed depreciation, in
view of the virtual certainty of realisation of this asset. The overall contribution of
the subsidiary to the financial results of the Company is not significant currently. The
subsidiary is committed towards increasing its presence in the industry and is focused on
scaling up the business and revenue.
The Company will make available separate audited financial statements
of the subsidiary company to any Member upon request. These documents/details are
available on the Company's website (www.iciciprulife.com) and will also be made
available for inspection by any Member of the Company at its registered office. A
statement containing salient features of the financial statements of the subsidiary
company forms part of the financial statements of the Company.
Rural and social business
The Company has micro insurance retail products and group micro
insurance products to cater to the protection need of the unorganized and economically
vulnerable section of the society.
The Company has provided risk cover to self-help group (SHG)
members predominantly in the rural areas of Tamil Nadu, Maharashtra and Karnataka. These
members belong to a group of micro entrepreneurs having homogeneous social and economic
background, who come together to avail micro credit for financing their small and micro
enterprises.
The Company partners with micro finance institutions, banks and
extends both retail and group micro insurance cover to customers for covering their loss
of income risk arising out of unfortunate and untimely demise.
The Company has deployed dedicated manpower in ICICI Bank
branches across the identified/allotted rural markets to deep-mine the opportunity through
retail & group products largely aimed at covering the loan portfolio of bank
customers. The team engages with the members associated with Bank's SHPIs (Self-Help
Promoting Institutions) to educate on need of insurance & selling of micro-insurance
products.
136,615 policies were issued in rural areas, constituting 22.63%
of total policy issuances. The Company also covered 4,497,729 lives as a part of its
social sector coverage.
FINANCIALS & AUDIT Financials
Particulars |
Standalone |
Consolidated |
|
FY2022 |
FY2023 |
FY2022 |
FY2023 |
Profit after tax |
7.54 |
8.11 |
7.59 |
8.13 |
Balance brought forward from the previous year |
36.11 |
40.78 |
36.01 |
40.73 |
Profit available for appropriations |
43.65 |
48.88 |
43.60 |
48.86 |
Appropriations: |
|
|
|
|
Interim Equity Dividend |
- |
- |
- |
- |
Final Equity Dividend |
2.87 |
0.79 |
2.87 |
0.79 |
Tax on Equity Dividend |
- |
- |
- |
- |
Surplus carried to next year's account |
40.78 |
48.09 |
40.73 |
48.07 |
The financial position of the Company remained strong with a solvency
ratio of 208.9% at March 31, 2023 (204.5% at March 31, 2022) against the minimum
regulatory requirement of 150%.
Dividend and dividend distribution policy
The operations have resulted in a profit after tax of Rs. 8.11 billion
in fiscal 2023 as compared to a profit after tax of
Rs. 7.54 billion for the previous year.
The Company has paid annual coupon payable on non-convertible
debentures on its due date of November 5, 2022. The interest accrued thereafter has been
duly provided for in the books of accounts. The Company's solvency ratio stood at
208.9% on March 31, 2023. The Board has proposed a final dividend of Rs. 0.60 per equity
share for FY2023 amounting to Rs. 0.86 billion for FY2023, representing a dividend payout
ratio of 10.6% of PAT.
In terms of Regulation 43A of Securities and Exchange Board of India
(Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing
Regulations"), the Dividend Distribution Policy of the Company is disclosed on its
website https://www.iciciprulife.com/ about-us/corporate-policies.html.
Transfer of unclaimed dividend and shares to Investor Education &
Protection Fund (IEPF)
Pursuant to the provisions of Section 124 of the Companies Act, 2013
(CA2013), the amount of dividend remaining unpaid or unclaimed for a period of seven years
from the date of its transfer to the unpaid dividend account/s' of the Company,
are required to be transferred to the Investor Education and Protection Fund (IEPF)
established by the Central Government. The unclaimed dividend for the financial year ended
March 31, 2016 and March 31, 2017 shall be transferred to the IEPF in FY2024. The
corresponding shares, if the dividend is unclaimed for a period of seven years along with
the unclaimed dividend shall also be transferred to the dematerialised account of the IEPF
Authority.
Members who have not yet encashed their dividend warrant(s) can claim
the same in accordance with the process made available on the website of the Company by
accessing the following link https://www.iciciprulife.
com/about-us/shareholder-information/dividends.html.
Particulars of loans, guarantees or investments
The provisions of Section 186(4) of the CA2013, requiring disclosure in
the financial statements of the full particulars of the loans given, investment made or
guarantee given or security provided including the purpose for which the loan or guarantee
or security is proposed to be utilised by the Company, are not applicable to an insurance
company.
Particulars of contracts or arrangements with related parties
The particulars of contracts or arrangements entered into by the
Company with related parties referred to in sub-section (1) of Section 188 of the CA2013
including certain arm's length transactions under third proviso thereto are disclosed
in Form AOC-2 appended as Annexure A. Further, as per the shareholding pattern of the
Company, only ICICI Bank Limited and Prudential Corporations Holdings Limited have a
holding of 10% and more in the Company. The transactions with these entities are disclosed
in the note 3.12 of related party transactions under notes to accounts.
The Company has a Board approved policy on Related Party Transactions,
which has been updated as per the amendments in SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 issued in November 2021 and the updated policy has been
hosted on the website of the Company and can be viewed at
https://www.iciciprulife.com/about-us/ corporate-policies.html.
Public deposits
During the year under review, the Company has not accepted any deposits
under Section 73 of the CA2013.
Auditors Statutory auditors
B S R & Co. LLP, bearing registration number 101248W/ W-100022,
Chartered Accountants and Walker Chandiok
& Co LLP bearing registration number 001076N/ N500013, Chartered
Accountants are the joint statutory auditors of the Company, as per the applicable
provisions of the Companies Act, 2013 and the IRDAI Corporate Governance guidelines for
insures in India, 2016.
B S R & Co. LLP were originally appointed as one of the joint
statutory auditors from FY2014-15 and were re-appointed on July 17, 2019 for a term of
five years i.e. from conclusion of the 19th annual general meeting (AGM) upto
the conclusion of 24th AGM of the Company.
Walker Chandiok & Co LLP were originally appointed as one of the
joint statutory auditors from FY2016-17 and were re-appointed on June 25, 2021 for a term
of five years i.e. from the conclusion of the 21st AGM upto the conclusion of
the 26th AGM of the Company.
Fees for services to statutory auditors
The Company has incurred Rs. 23.96 million as statutory audit fees for
the year ended March 31, 2023. Further, the Company has not availed any other services
from the statutory auditors or its network entities/affiliated firms during the year ended
March 31, 2023.
Secretarial auditors
The Company has, with the approval of its Board of Directors, appointed
M/s. Makarand M. Joshi & Co., Company Secretaries to undertake secretarial audit of
the Company for FY2023. The secretarial audit report is annexed herewith as Annexure B.
Auditor's report
There is no qualification, reservation or adverse remark made by both,
the statutory auditors and secretarial auditors, in their report. There were no reportable
frauds identified by the auditors during the FY2023.
COMPLIANCE AND RISK
Statement in respect of adequacy of internal financial controls
The Company has complied with internal financial controls (IFC) as per
section-134 (5) of Companies Act, 2013 and regulation 17(8) of the Securities and Exchange
Board of India (SEBI) (Listing Obligations and Disclosure Requirements) Regulations, 2015
in terms of internal controls over financial reporting and section 404 of Sarbanes Oxley
Act (SOX), 2002. To ensure effective internal financial controls, the Company has
implemented Internal Control Framework, 2013 endorsed by the Committee of Sponsoring
Organisations (COSO) of the Treadway Commission. The Company's internal financial
control framework comprises of internal controls over financial reporting, operating
controls, and fraud prevention controls. The framework is designed to ensure accuracy,
completeness and reliability of financial records, orderly and efficient conduct of
business and safeguarding of assets as well as prevention and detection of fraud. The
Company has a mechanism of testing the controls at regular intervals for design and
operating effectiveness. Further, the auditors opine on the adequacy and operating
effectiveness of internal financial controls over financial reporting. The Company
believes that strengthening of internal controls is an ongoing process and there will be
continuous efforts to keep pace with changing business needs and environment. The key
components of the internal financial control framework include:
Entity level controls: The control environment of the Company relies on
a set of Entity Level Controls (ELCs) that operate at an organisation level and may not be
embedded in any single process of the Company. The ELCs set up by the Company include: (a)
Corporate governance framework comprising Board and Executive committees for oversight of
the management of the Company. (b) Policies commensurate with the Company's size and
level of complexity to establish standards of conduct, including a code of conduct,
whistle blower policy, prevention of harassment in the workplace, conflict of interest,
insurance awareness and customer education policy, grievance redressal policy, record
maintenance policy, delegation of financial powers, accounting policy, etc.
(c) Risk and fraud management framework to identify, measure, monitor
and control various risks including operational risks, and a framework for identifying,
monitoring and control over outsourced activities.
(d) Independent Internal Audit Department with oversight from the Audit
Committee.
(e) Employee management framework comprises hiring, retention,
training, performance evaluation, remuneration structure, compensation, succession
planning through leadership cover index, etc.
(f) Framework to ensure compliance with regulations, laws including
compliance certification, regular communication of changes in regulations/ laws, and
litigation management. Framework to ensure compliance of internal control over financial
reporting.
(g) Budgeting, monitoring, and reporting of the performance with key
performance indicators.
(h) Information and cyber security policy and information security
framework along with framework to ensure business continuity and disaster recovery.
Process controls: These comprise of controls operating at process level
with the objective of providing assurance at a transaction recording stage. The salient
aspects of the control framework include:
(a) All business processes having implications on financial results,
regulatory and shareholder reporting are subject to quarterly reviews. Any material
deficiency is discussed at the Audit Committee meetings.
(b) The Company has deployed automation in most aspects of transaction
processing (including policy administration, investment management, actuarial
computations, expense processing, claims management, human resource processes and
accounting) to ensure greater control and efficiency.
Information Technology (IT) controls: The Company has in place a robust
IT control environment including controls pertaining to change management, system &
database management, access management, master maintenance, interface, job scheduling, and
backup and disaster recovery to ensure data integrity and accuracy of information stored
in IT systems.
Control over third parties providing services: The Company has a vendor
on-boarding process with due diligence, risk assessment, document review and periodic
assessment to ensure controls over third-party service providers relevant from a financial
reporting perspective. Further, the Board Risk Management Committee has oversight on the
implementation of controls and monitors the performance of the outsourced vendors.
Safeguarding of assets: The Company has adequate controls over safeguarding of assets
(comprising of investment assets, IT assets and other assets). These controls are based on
value and custody of assets. Review controls: Review controls comprise of multiple levels
of oversight over financial reporting by way of a strong reporting and review framework as
follows:
(a) The financials are audited by joint statutory auditors and are
reviewed and approved by the Audit Committee and Board. They are also submitted to the
Insurance Regulatory and Development Authority of India (IRDAI).
(b) The Internal Audit Department exercises independent oversight over
operational and financial processes. Any significant observations and recommendations are
presented to the Audit Committee. The investment operations function is subject to
concurrent audit certification and an Investment Risk Management Systems (IRMS) audit once
in two years. Any significant findings in the concurrent audit or IRMS audit are presented
to the Audit Committee.
(c) The Company has an effective organisation structure that segregates
duties among business groups, thereby, ensuring orderly and efficient conduct of business.
Additionally, the Board has constituted various committees responsible for specific
operational areas, formulation of policies and frameworks, and identification, assessment
and monitoring of principal risks in accordance with the policies and procedures. (d)
There are senior management controls comprising of high-level controls (HLC) and
management review controls (MRC) to monitor and identify any material misstatement.
Management exercises review control by way of in-depth reviews of financials, ledger
balances, suspense items and payables, liability assumptions, information security,
regulatory compliance, communication and reporting, key compliance issues, supervision of
risk management function, etc. conducted by the Chief Financial Officer, Appointed
Actuary, Head of Information Technology, Head of Operations and Head of Compliance &
Risk.
Fraud prevention: The Company has a Board approved fraud risk
management policy which is based on Insurance Fraud Monitoring Framework'
guidelines issued by IRDAI. The Company has an Operational Risk Management Committee
(ORMC) which independently monitors frauds. The ORMC reports to the Executive Risk
Committee which ultimately reports to the Board Risk Management Committee (BRMC).
(a) The fraud control framework consists of preventive measures,
incident management and awareness activities. Preventive measures include fraud risk
assessment for design of processes, investigation triggers across policy life cycle, and
proactive use of analytics to identify fraud patterns. Incident management includes
recovery of loss, action through law enforcement agencies, detailed investigation and root
cause analysis, and fraud incident reporting to BRMC. Awareness includes mandatory
induction training and awareness program for employees, regular communication to policy
holders, fraud prevention tips on the Company's website, etc.
(b) The Company ensures implementation of controls to prevent
repetition of incidents, financial recovery process, and disciplinary action against
involved employees. It also initiates actions through law enforcement authorities based on
severity of the incident. (c) TheCompanyundertakesseveralmeasuresfromtime to time to
create awareness amongst its employees and customers against fraudulent practices.
Internal audit and compliance framework
Internal audit:
The Internal Audit Department (IAD) of the Company acts as an
independent entity and reports to the Audit Committee of the Board. IAD has an
unrestricted access to the Audit Committee Chairperson and the Managing Director and Chief
Executive Officer (MD & CEO). The HeadInternal Audit reports directly to the
Audit Committee of the Board and administratively reports to the Chief Risk &
Compliance Officer. The IAD has developed a Risk Based Audit Plan (RBAP) and the same has
been approved by the Audit Committee of the Board. The basic philosophy of risk based
audit framework is to provide reasonable assurance to the Audit Committee of the Board and
management about the adequacy and effectiveness of the risk management and control
framework in the Company. The scope of Internal Audit includes the review of risk
management procedures, internal control systems, information systems and governance
processes. Key audit observations and recommendations made are reported to and discussed
at the Audit Committee of the Board. Implementation of the recommendations is actively
monitored.
Compliance:
The Board Audit Committee oversees the compliance framework of the
Company. The Company has formulated various internal policies/procedures, such as the
Compliance Policy, Anti- Bribery and Anti- Corruption Policy, Anti-Money Laundering Policy
and an employee code of conduct, which govern the day-to-day activities to ensure
compliance. The compliance function disseminates the information regarding relevant laws,
regulations and circulars related to insurance and anti-money laundering to various
functions. It also serves as a reference point for the staff of various functions for
seeking clarifications on applicable laws, regulations and circulars issued on these
aspects. The compliance team also monitors the adequacy of the compliance framework across
the Company with the Internal Audit Department through an integrated risk based audit
plan. Key issues observed as a part of this monitoring are reported to the Board Audit
Committee and implementation of recommendations is actively monitored. A compliance
certificate signed by the Managing Director & CEO, based on the certification from
respective functional heads, is placed at the Board Audit Committee and Board of Directors
meetings on a quarterly basis.
Risk management
The Company recognises that risk is an integral element of the business
and the managed acceptance of risk is essential for generating shareholder value. The risk
governance structure of the Company consists of the Board, the Board Risk Management
Committee (BRMC), the Product Management Committee (PMC), the Executive Risk Committee
(ERC) and its sub-committees. The risk philosophy of the Company is outlined in the Board
approved risk policy which is reviewed by the Board at least annually. The Board risk
policy details identification, measurement, monitoring and control standards relating to
various individual risks, namely investment (market, credit and liquidity), insurance,
operational (including legal, compliance, outsourcing, customer dissonance, business
continuity, information and cyber security) and reputation. The Board periodically reviews
the potential impact of strategic risks such as changes in macro-economic factors,
government policies, regulatory environment and tax regime on the business plan of the
Company. In addition to these risks, the life insurance industry faces a number of
emerging risks. While COVID-19 claims during the year were much lower, there has been a
resurgence of COVID-19 infections recently in the country and the claims experience will
need to be monitored. Geo-political tensions and the potential for disruption to energy
supplies are an additional source of uncertainty for financial and commodity markets and
trigger for inflation (which could impact credit quality of counterparties, as well as
reduce real wages thereby impacting discretionary savings, insurance new business and
persistency risk). There are also emerging risks related to ESG (environmental, social and
governance) issues. One of the most prominent ESG risks is that of climate change which
could potentially have wide-ranging implications including (but not limited to) adverse
impact on economic growth and investment markets and higher than expected claims due to
increased risk of future weather related catastrophes, pandemics as well as possible
changes in long-term mortality/morbidity rates. Apart from climate change, there are
emerging risks associated with public health trends such as increase in obesity related
disorders and demographic changes such as population urbanisation and ageing. Other
important ESG elements include data privacy which has an increasing material impact on
Company's reputation.
The risk management framework of the Company seeks to identify, measure
and control its exposures to all these risks within its overall risk appetite. The Company
periodically carries out stress testing of its assets and liabilities to identify impact
on regulatory and economic solvency, statutory profits and liquidity position. Such
testing is used as an aid in identifying significant existing or emerging risks to its
financial position, including the potential impact of severe economic shocks and
catastrophic events like pandemics, which could materialize as a consequence of several
risk factors including climate change and other sustainability risks. The Company has a
framework for information and cyber security as well as business continuity management to
analyse emerging risks through regular monitoring of the external and internal environment
which has been further augmented in the current situation. The Company also has a privacy
policy to ensure protection of sensitive personal data or information collected. During
the year, the Company has updated the Board risk policy by integrating sustainability
risks in the risk management framework. The key aspects of the Company's risk
management framework have been outlined below. Further information on the Company's
approach to risk management is available in the sections on Enterprise Risk
Management' and Risks and Opportunities' of this Annual Report.
1.1. Investment risk
Investment risk is the risk arising out of variations in the level or
volatility of market prices of assets and financial instruments, including the risk
arising from any mismatch between assets and liabilities, due to external market and
economic factors. The Company faces limited liquidity risk due to the nature of its
liabilities. The key mitigation approaches for this risk are as follows: (a) Product
approval process: Launching new products can significantly alter the risk profile of the
Company's Balance Sheet. Investment risks inherent in new products or significant
modifications to existing products are identified at product design stage and products are
launched only after approval by the ERC and PMC. (b) Asset Liability Management (ALM): The
Company has detailed Investment Specifications that govern the investment strategy and
limits for each fund depending on the profile of the liability backed by those assets. For
each category of products, the Investment Specifications define limits to permissible
exposures to various asset classes, duration guidelines for fixed income instruments and
minimum investment in liquid assets. The Company uses derivatives to hedge interest rate
risk.
(c) Exposure limits have been defined for companies, groups and
industries in accordance with regulatory guidelines and the Company's internal
Investment Policy. The Company restricts investments primarily to securities rated AA and
above.
(d) The Company has a liquidity contingency plan in place.
(e) As part of its ESG philosophy, the Company has implemented a
framework for investment decisions that will support mitigation of risks due to climate
change as well as other environmental, social and governance risks by factoring these in
its investment decisions.
1.2. Insurance Risk
Insurance risk is the risk arising because of variance to the best
estimate or because of random fluctuations in the frequency, size and timing of insurance
liabilities. Insurance risk comprise the following components: mortality, morbidity,
persistency and expense risk. These risks are mitigated through the following:
(a) Product approval process: Insurance risks inherent in the new
products or significant modifications to existing products are identified at product
design stage and products are launched only after approval by the ERC and PMC. The
Company, in its product design, incorporates product features and uses appropriate policy
wordings to mitigate insurance risk.
(b) Reinsurance: The Company uses appropriate reinsurance arrangements,
including catastrophe reinsurance, to manage insurance risk. Such reinsurance arrangements
may be used to support risk transfer of sustainability risks as well. The arrangements are
with select and financially sound reinsurers. The Company's reinsurance exposures are
considered and approved by the ERC periodically.
(c) Underwriting and claims controls: Underwriting and claims policies
and procedures are in place to assess and manage mortality and morbidity risks. The
Company seeks to minimise these risks by diversifying its business portfolio and adhering
to appropriate and segmented underwriting norms. The Company conducts periodic reviews of
both underwriting and claims procedures. Adjustments to the underwriting strategy may be
made to allow for any changes in the insurance risk landscape or emerging risks.
(d) Experience analysis: The Company conducts its experience analysis
regularly in order to monitor trends, gain insights on emerging risks, if any and to
ensure that corrective actions can be initiated at the earliest opportunity and that
assumptions used in product pricing, reserving and embedded value
reportingareinlinewiththeexperience.TheCompany actively monitors its claims experience,
persistency levels and expense ratios. During the course of the COVID-19 pandemic, the
Company has been closely monitoring the overall mortality experience including the deaths
on account of COVID-19.
(e) Aligning key performance indicators: The Company uses appropriate
key performance indicators for different levels of hierarchy in sales and operations to
align interests and ensure adequate focus on insurance risk especially, persistency and
expense.
(f) Product contracts: The Company designs exclusions and terms and
conditions in consultation with reinsurers and with due regard to market practices to
manage insurance risk, especially mortality and morbidity risk. In order to deal with a
changing insurance landscape or emerging risks, new products may be developed with more
suitable product features, policy wordings, exclusions and terms and conditions.
(g) Repricing: The Company reserves the right to reprice future new
business with IRDAI approval in case of adverse experience, which could materialize due to
various factors including sustainability issues.
1.3. Operational risk:
Operational risk is the risk of loss, resulting from inadequate or
failed internal processes, people and systems, or from external events. The Company uses
the following approaches to manage operational risk:
(a) The Company develops and monitors mitigation plans for high risk
items identified through the Risk and Control Self-Assessment (R&CSA) conducted for
each business function, through analysis of, loss events and review of audit findings.
(b) The Company continuously monitors internal loss events and ensures
adequate mitigation for material impact events.
(c) The Company actively promotes a risk awareness culture by improving
understanding through communication and education. It further engages with law enforcement
agencies to create awareness on various insurance frauds and emerging issues
(d) Fraud Management: The Company has a fraud risk management policy
that sets out the approach and guidelines for management of fraud risk. The Company
follows both a proactive and reactive approach to manage fraud. Proactive management is
done by using triggers to identify suspected frauds and through random sample checks.
Reactive management is done through incident management. The Company ensures
implementation of controls to prevent recurrence of such incidents, financial recovery
whenever applicable and disciplinary action against involved employees in accordance with
the Company's Code of Conduct. It also initiates actions through law enforcement
authorities based on severity of incidents.
(e) Outsourcing Risk: The Company has an outsourcing policy to ensure
effective oversight and adequate due diligence with regard to outsourcing of activities.
The Company outsources processes which are permitted based on the regulatory guidelines.
The Company carries out required due-diligence for any new vendor empanelment and annual
assessment of outsourced vendors.
(f) Business Continuity Management (BCM): The Company has a BCM policy
and framework to ensure resilience and continuity of key products and services at a
minimum acceptable level. BCM includes systems and processes for management of risk
including use of disaster recovery sites and business continuity plans for critical
processes which are being tested periodically. The Company has been accredited with the
ISO 22301:2019 certification for the business continuity management systems.
(g) Information and cyber security: The Company has an information and
cyber security policy and framework that ensures all information assets are safeguarded by
establishing comprehensive management processesthroughouttheorganisation.TheCompany has
defence-in-depth approach, and has deployed security solutions like firewalls, intrusion
prevention systems, anti-malware solutions, email security, data leakage prevention and
web proxy. Vulnerability assessment and penetration testing program for critical
information technology applications and infrastructure has been defined, to ensure IT
Systems are secured for operations during its life-cycle. Further, cloud security strategy
and practices for protecting data and IT infrastructure has been implemented. Cyber
security operations centre (SOC) has been set up for proactive monitoring (24x7), incident
response, recovery and remediation activities. Cyber security advisories issued by
security experts on current geopolitical environment are being monitored and suitable
actions are being initiated. Based on the Information Security Management System (ISMS)
controls implemented and the assessment conducted by the certification body, the Company
has been awarded a certification under ISO 27001:2013 standard.
(h) Privacy policy: The Company has a privacy policy in accordance with
Information technology (Reasonable security practices and procedures and sensitive
personal data or information) Rules, 2011. The policy provides the Company's
commitment to privacy throughout the life-cycle of the information from collection,
processing, sharing, retention and destruction, by taking reasonable steps to protect the
confidentiality of the Personal Information provided and protect it from unauthorised
access or alteration, disclosure or destruction.
(i) The Company has adopted highest business, governance, ethical and
legal standards. The Whistle blower policy aims to provide a mechanism to ensure that
concerns are appropriately raised, independently investigated and addressed.
1.4. Reputation Risk:
Reputation risk is defined as the risk of negative opinion about the
financial stability, service levels, integrity, transparency or any other aspect, as
perceived by the stakeholders, resulting in a decline in business volumes and eventually
impacting continuity of business. The Company has a framework in place for managing
reputation risk and periodically monitors various parameters that could impact the
reputation of the Company.
Code of conduct under Securities and Exchange Board of India
(Prohibition of Insider Trading) Regulations, 2015
The Company has in place a Code of conduct to regulate, monitor and
report trades in Securities by Designated Persons ("Code") which is in
accordance with the SEBI (Prohibition of Insider Trading) Regulations, 2015 as amended
from time to time. The Code is applicable to the Directors, employees of the Company,
Designated Persons and their immediate relatives, as detailed therein. The objective of
the Code is to achieve compliance to the SEBI (Prohibition of Insider Trading)
Regulations. Any infractions/violations of the Code are suitably dealt with as provided
for in the Code.
CEO/CFO certification
In terms of the Listing Regulations, the certification by the Managing
Director & CEO and Chief Financial Officer on the financial statements and internal
controls relating to financial reporting has been obtained.
CORPORATE GOVERNANCE
The Company considers its stakeholders as partners in success, and
remains committed to delivering value to stakeholders. The Company believes that a sound
corporate governance mechanism is critical to retain and enhance stakeholders' trust.
It is committed to exercise overall responsibilities rigorously and diligently throughout
the organisation, managing its affairs in a manner consistent with corporate governance
requirements and expectations.
The Company's corporate governance philosophy is based on an
effective independent Board including the separation of Board's supervisory role from
the executive management. The Board Committees are generally comprising of a majority of
independent/non-executive Directors and are chaired by independent Directors, to oversee
critical areas of business operations.
Significantandmaterialorderspassedbytheregulators or courts or
tribunals impacting the going concern status of the Company and its future operations
There are no significant and/or material orders passed by the
regulators or courts or tribunals impacting the going concern status of future operations
of the Company.
Compliance to Secretarial Standards
The Company was in compliance with the applicable Secretarial Standards
issued by the Institute of Company Secretaries of India for the FY2023.
Annual return
A copy of the annual return for FY2023 is hosted on the website of the
Company at https:// www.iciciprulife.com/about-us/shareholder-information/ other.html in
accordance with the provisions of the CA2013 with the information available up to the date
of this report, and shall be further updated as soon as possible but no later than sixty
days from the date of the Annual General Meeting.
Particulars of employees
The statement containing the particulars of employees as required to be
disclosed under Section 197(12) of the CA2013, read with Rule 5(2) of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, is set out in an
Annexure and forms part of this Report. In terms of Section 136(1) of CA2013, the Report
and the Accounts are sent to the members excluding the aforesaid Annexure. Any member
interested in obtaining a copy of this Annexure may write to the Company Secretary at the
Registered Office of the Company.
Corporate Social Responsibility (CSR) initiatives
The Corporate Social Responsibility policy as approved by the Board has
been hosted on the Company's website
(https://www.iciciprulife.com/about-us/corporate-policies.html?ID=about-corp) The Company
has spent Rs. 39.6 million for FY2023 towards CSR programs as against Rs. 38.8 million
required to be spent, which is 2.04% of the average net profits made during the three
immediately preceding financial years, in accordance with Section 135 of the Companies
Act, 2013. The detailed annual report on Corporate Social Responsibility activities is
annexed herewith as Annexure C.
Sexual harassment policy
The Sexual Harassment of Women at Workplace (Prevention, Prohibition
and Redressal) Act, 2013 provides protection against sexual harassment of women at the
workplace and lays down guidelines for the prevention and redressal of complaints of
sexual harassment. The Company has implemented its policy on prevention of sexual
harassment at the workplace and has made it available to all employees on the
Company's intranet. The Company in its endeavor to extending a safe and secure
working environment, on an ongoing basis, ensures awareness and sensitization of the
policy amongst its employees. Disclosures in relation to the Sexual Harassment of Women at
Workplace (Prevention, Prohibition and Redressal) Act, 2013: a. number of complaints filed
during the financial year: 18 b. number of complaints disposed of during the financial
year: 17 c. number of complaints pending to be resolved as on end of financial year: 1*
* The one pending complaint as on March 31, 2023, stands resolved as on
the date of the report.
Further, the Company has complied with provisions relating to the
constitution of Internal Complaints Committee under the Sexual Harassment of Women at
Workplace (Prevention, Prohibition and Redressal) Act, 2013.
Whistle blower policy
The Company has adopted highest business, governance, ethical and legal
standards. The Whistle Blower policy aims to provide a mechanism to ensure that concerns
are appropriately raised, independently investigated and addressed.
The purpose of the policy is to encourage employees/ stakeholders to
report matters without the risk of subsequent victimisation, discrimination or
disadvantage. The Whistle Blower policy covers all employees, including Directors of the
Company and stakeholders. The policy encourages any employee, stakeholder or Director to
report any breach of any law, statute or regulation, issues related to accounting policies
and procedures, acts resulting in financial loss or loss of reputation, misuse of office,
suspected/actual fraud and criminal offences, non-compliance to anti-bribery and
anti-corruption policy. Besides, it also includes leak of any unpublished price sensitive
information (UPSI) pursuant to SEBI Regulations or any such information prescribed
pursuant to any regulations/laws, as amended from time to time. Such complaints are
reported to the Audit Committee of the Board. The policy has been periodically
communicated to the employees and for stakeholders, an extract of the same has also been
hosted on the Company's intranet and details pertaining to establishment of a vigil
mechanism are hosted on the website at https://www.iciciprulife.
com/about-us/corporate-policies.html?ID=about-corp.
Code of conduct
The Company has a code of conduct (Code) for Directors and employees of
the Company, which was last reviewed and amended by the Board of Directors at its meeting
held on July 16, 2022. The Code aims at ensuring consistent standards of conduct and
ethical business practices across the constituents of the Company. The Code lays down the
broad framework of general guiding principles for conducting day-to-day business. This
Code is available on the website of the Company (https://www.iciciprulife.
com/about-us/corporate-policies.html?ID=about-corp). Pursuant to the Listing Regulations,
a confirmation from the Managing Director & CEO regarding compliance with the Code by
all the Directors and senior management forms part of this Annual Report.
Policy for determining material subsidiaries
In accordance with the requirements of the Listing Regulations, the
Company has formulated a policy for determining material subsidiaries and the same has
been hosted on the website of the Company (https://
www.iciciprulife.com/about-us/corporate-policies. html?ID=about-corp).
Board of Directors
The Company's Board is constituted in compliance with the CA2013,
in accordance with Listing Regulations and IRDAI Corporate Governance Guidelines, 2016. At
March 31, 2023, the Board of Directors of the Company comprised five independent
Directors, three non-executive Directors, and the Managing Director & CEO. Out of the
three non-executive Directors, two Directors are nominated by ICICI Bank Limited and one
by Prudential Corporation Holdings Limited. The Chairman of the Board is an Independent
Director. Except the Managing Director & CEO, all other Directors including the
Chairman of the Board are non-executive Directors and/ or independent Directors. The Board
is responsible for the corporate strategy and other responsibilities as laid down by IRDAI
under the Corporate Governance guidelines. The Managing Director & CEO oversees
implementation of the strategy, achievement of the business plan and day-to-day
operations. There is an appropriate mix of executive, non-executive and independent
Directors on various Board Committees. None of the Directors is/are related to any other
Director or employee of the Company. The Board functions either as a full Board or through
various Committees constituted to oversee specific areas. The Board has constituted
Committees, namely, Board Audit Committee, Board Risk Management Committee, Board
Investment Committee, Board Customer Service & Policyholders' Protection
Committee, Board Nomination and Remuneration Committee, Board Corporate Social
Responsibility Committee, Stakeholders Relationship Committee, With Profits Committee and
Strategy Committee.
The Company recognises that a diverse Board will have different
thoughts, perspectives, knowledge, skill, industry experience, age and gender, which will
ensure that the
Company retains its competitive advantage. The Board Nomination and
Remuneration Committee recommends the appointment of Director(s) to the Board of the
Company based on the criteria for appointment of Directors.
In accordance with the criteria for appointment of the Directors
and official(s) who may be appointed in senior management of the Company', identified
by the Board, the areas of knowledge, skills and expertise which would be required to be
possessed by the Board of the Directors of the Company in the context of life insurance
business, included finance & accountancy, banking, insurance, strategy and corporate
planning, risk management, securities market, economics, law and governance, consumer
insights, marketing and human resources. The Directors of the Company have the skills and
expertise as prescribed in the criteria, details of which are given below along with their
educational qualification.
Directors Identification Name of the
Director Number (DIN) |
Educational Qualification |
Field of specialisation/ areas of core
expertise |
Non-executive non-independent Directors |
|
|
Mr. Sandeep Batra, 03620913 non-executive Director nominated
by ICICI Bank Limited |
Chartered Accountant and Company Secretary |
Finance & accountancy, banking, insurance, risk
management, securities market and economics, law and governance, customer insights,
marketing, human resources |
Mr. Anuj Bhargava, 02647635 non-executive Director nominated
by ICICI Bank Limited1 |
Chartered Accountant from the Institute of Chartered
Accountants of India, Bachelor of Commerce (Sydenham College). |
Finance and Accountancy, Banking, Marketing |
Mr. Benjamin Bulmer, 09682658 non-executive Director
nominated by Prudential Corporation Holdings Limited2 Non-executive independent
Directors |
Fellow Chartered Accountant from the Chartered Institute of
Management Accountants, Bachelor of Arts (Hons), London School of Economics. |
Finance & accountancy, actuarial and taxation |
Mr. M. S. 00943629 Ramachandran Chairman Mr. Dilip
Karnik 06419513 |
Bachelor'sdegreeinMechanicalEngineering from the College
of Engineering, Guindy (Anna University) Bachelor's degree in Science and
Bachelor's degree in Law (Gold Medalist) |
Strategy and corporate planning Law and governance |
Mr. R. K. Nair 07225354 |
Master's degree in Science, Bachelor's degree in
Law, Master of Business Administration Financial Management, Diploma in Securities
Law |
Finance & accountancy, banking, insurance and securities
market and economics |
Mr. Dileep Choksi 00016322 |
Chartered Accountant, Bachelor's degree in Law, a member
of the Institute of Cost and Works Accountants of India (ICWA), and Trust and Estate
Practitioner (TEP) and member of Society of Trust and Estate Practitioners (STEP) |
Finance & accountancy, taxation, strategy and corporate
planning |
Ms. Vibha Paul Rishi 05180796 Whole-time Director(s) |
Master degree in Business Administration with a
specialisation in Marketing from the Faculty of Management Studies, University of Delhi
and Honours in Economics from Lady Sri Ram College, Delhi University |
Consumer insights, marketing, strategy and human resources |
Mr.N.S.Kannan,Managing 00066009 Director & CEO3 |
MBA from the Indian Institute of Management, Bangalore with a
gold medal for best all-round performance. A distinguished alumnus of the National
Institute of Technology, Trichy from where he graduated as a Mechanical Engineer with
Honours. Chartered Financial Analyst from the Institute of Chartered Financial Analysts of
India. |
Finance & accountancy, banking, insurance, strategy and
corporate planning, risk management and securities market and economics |
Mr. Anup Bagchi, 00105962 Executive Director and Chief
Operating Officer4 |
Management degree from Indian Institute of Management,
Bangalore and Engineering degree from Indian Institute of Technology, Kanpur |
Finance & accountancy, banking, strategy and corporate
planning |
1 Appointed as a non-executive (Additional) Director of the
Company w.e.f. May 1, 2023
2 Appointed as a non-executive Director of the Company w.e.f.
July 27, 2022
3 Shall superannuate from the services of the Company on the
completion of his term as Managing Director & CEO on June 18, 2023.
4 Appointed as the Executive Director & Chief Operating
Officer effective May 1, 2023 and as the Managing Director & CEO of the Company with
effect from June 19, 2023, subject to the approval of the shareholders. Prior to this, he
was a non-executive Director nominated by ICICI Bank Limited upto April 30, 2023.
During the year ended March 31, 2023, the Board of Directors of the
Company through a resolution dated July 27, 2022 approved the appointment of Mr. Benjamin
Bulmer (DIN: 09682658) as a non-executive (Additional) Director of the Company, nominated
by Prudential Corporation Holdings Limited, with effect from July 27, 2022.
Accordingly, based on the recommendation of the Board Nomination and
Remuneration Committee, the Board had recommended the appointment of Mr. Benjamin Bulmer
as non-executive Director of the Company for the approval of the members through postal
ballot to transact the special business, pertaining to appointment of Mr. Benjamin Bulmer
(DIN: 0009682658) as a Non-Executive Director of the Company with effect from July 27,
2022, by way of an ordinary resolution, and the same has been passed by the members, with
requisite majority.
There were seven meetings of the Board held during FY2023: Meetings
were held on April 16, 2022, May 17, 2022, July 16, 2022, October 15, 2022, January 17,
2023, March 15, 2023, and March 16, 2023. The maximum interval between any two meetings
did not exceed 120 days. The attendance of Directors at the Board meetings during the year
is set out in the following table:
Name of the Director |
Board meetings attended/held during the
year ended March 31, 2023 |
Attendance at last AGM (June 27, 2022) |
Non-executive non-independent Directors |
|
|
Mr. Anup Bagchi, non-executive Director nominated by ICICI
Bank Limited1 |
7/7 |
Present |
Mr. Sandeep Batra, non-executive Director nominated by ICICI
Bank Limited |
7/7 |
Present |
Mr. Wilfred John Blackburn, non-executive Director nominated
by Prudential |
2/3 |
Present |
Corporation Holding Limited2 |
|
|
Mr. Benjamin Bulmer, non-executive Director nominated by
Prudential |
3/4 |
- |
Corporation Holding Limited3 |
|
|
Non-executive independent Directors |
|
|
Mr. M. S. Ramachandran, Chairman |
7/7 |
Present |
Mr. Dilip Karnik |
7/7 |
Present |
Mr. R. K. Nair |
7/7 |
Present |
Mr. Dileep Choksi |
5/7 |
Present |
Ms. Vibha Paul Rishi |
7/7 |
Present |
Whole-time Director(s) |
|
|
Mr. N. S. Kannan, Managing Director & CEO4 |
7/7 |
Present |
1 Appointed as the Executive Director & Chief Operating
Officer effective May 1, 2023 and as the Managing Director & CEO of the Company with
effect from June 19, 2023, subject to the approval of the shareholders.
2 Ceased to be a non-executive Director of the Company w.e.f.
July 27, 2022
3 Appointed as a non-executive Director of the Company w.e.f.
July 27, 2022
4 Shall superannuate from the services of the Company on the
completion of his term as Managing Director & CEO on June 18, 2023.
The details of other directorships/committee membership held by the
Directors of the Company as at March 31, 2023 are set out below:
Name of the Director |
Indian public limited
companies1 |
Number of other
directorships other companies2 |
Number of other
committee memberships3 (Audit Committee and Stakeholders Relationship Committee
of Indian public limited companies) |
Names of other listed entities where the
person is a director and category of directorship |
Non-executive non-independent Directors |
|
|
|
|
|
Mr. Anup Bagchi, non-executive |
3(1) |
0 |
0 |
|
ICICI Bank Limited, Executive Director |
Director nominated by |
|
|
|
|
|
ICICI Bank Limited4 |
|
|
|
|
|
Mr. Sandeep Batra, |
4 |
0 |
3 |
1. |
ICICI Bank Limited, Executive Director |
non-executive |
|
|
|
2. |
ICICI Lombard General Insurance |
Director nominated by |
|
|
|
|
Company Limited, Non-Executive - |
ICICI Bank Limited |
|
|
|
|
Non Independent Director |
Mr. Benjamin Bulmer, |
0 |
5(2) |
0 |
- |
|
non-executive |
|
|
|
|
|
Director nominated by |
|
|
|
|
|
Prudential Corporation |
|
|
|
|
|
Holding Limited |
|
|
|
|
|
Non-executive independent Directors |
|
|
|
|
|
Mr. M. S. Ramachandran, Chairman |
2 |
1 |
1 |
1. |
Supreme Petrochem Limited, Non- Executive - Independent
Director |
|
|
|
|
2. |
ESTER Industries Limited, Non- Executive - Independent
Director |
Mr. Dilip Karnik |
5 |
0 |
3 |
1. |
Birla Corporation Limited, Non- Executive - Non Independent
Director |
|
|
|
|
2. |
Universal Cables Limited, Non- Executive - Non Independent
Director |
|
|
|
|
3. |
Vindhya Telelinks Limited, Non- Executive - Non Independent
Director |
|
|
|
|
4. |
ICICI Securities Primary Dealership Limited (Debt listed),
Independent Director |
Mr. R. K. Nair |
5 |
2 |
6(1) |
1. |
ICICI Bank Limited, Non-Executive - Independent Director |
|
|
|
|
2. |
Geojit Financial Services Limited, Non- Executive -
Independent Director |
|
|
|
|
3. |
ICICI Securities Primary Dealership Limited (Debt listed),
Independent Director |
|
|
|
|
4. |
Inditrade Capital Limited - Non- Executive - Independent
Director |
Mr. Dileep Choksi |
8 |
2 |
7(2) |
1. |
Arvind Limited, Non-Executive - Independent Director |
|
|
|
|
2. |
Deepak Nitrite Limited, Non-Executive - Independent Director |
|
|
|
|
3. |
AIA Engineering Limited, Non -Executive - Independent
Director |
|
|
|
|
4. |
Swaraj Engines Ltd, Non-Executive - Independent Director |
Ms. Vibha Paul Rishi |
4 |
4 |
5(3) |
1. |
Asian Paints Limited, Non-Executive - Independent Director |
|
|
|
|
2. |
Tata Chemicals Limited, Non- Executive - Independent Director |
|
|
|
|
3. |
ICICI Bank Limited, Non-Executive - Independent Director |
|
|
|
|
4. |
Piramal Pharma Limited - Non- Executive Independent
Director |
Whole-time Director(s) |
|
|
|
|
|
Mr. N. S. Kannan, Managing Director & CEO |
1(1) |
0 |
0 |
- |
|
1. Comprises of other public limited companies incorporated in
India. Figures in parentheses indicate Board chairpersonship by the Directors in other
unlisted public companies.
2. Comprises of private limited companies incorporated in India
and foreign companies but excludes Section 8 companies and not for profit foreign
companies. Figures in parentheses indicate Board chairpersonship.
3. Figures in parentheses indicate committee chairmanship
including alternate chairpersonship.
4. Appointed as the Executive Director & Chief Operating
Officer effective May 1, 2023 and as the Managing Director & CEO of the Company with
effect from June 19, 2023, subject to the approval of the shareholders.
In terms of the Listing Regulations, the number of Committees (Audit
Committee and Stakeholders Relationship Committee) of public limited companies in which a
Director is a member/chairperson were within the limits prescribed under Listing
Regulations, for all the Directors of the Company. The number of directorships of each
independent Director is also within the limits prescribed under Listing Regulations.
Independent Directors
The Board of Directors of the Company at March 31, 2023 comprised nine
Directors, out of which five are independent Directors. Further, the Board of Directors of
the Company as on the date of this Report comprised ten Directors, out of which five are
independent Directors.
All independent Directors have confirmed that they meet the criteria of
independence as laid down under Section 149(6) of the CA2013 and the Listing Regulations
and have confirmed that their names have been added in the data bank maintained by the
Indian Institute of Corporate Affairs for independent directors, in accordance with Rule 6
of the Companies (Appointment and Qualification of Directors) Rules, 2014.
Pursuant to the provisions of Rule 6 of the Companies
(AppointmentandQualificationsofDirectors)Rules,2014, every individual whose name is so
included in the data bank shall pass an online proficiency self-assessment test. However,
an individual who has fulfilled the criteria prescribed in the Rule 6(4) of the said
Rules, is exempted from passing the online self-assessment test. In view of the same, none
of the Independent Directors were required to take the proficiency self-assessment test.
The Board at its meeting held on April 20, 2023 has reviewed the submissions received from
all the independent Directors and has confirmed that the independent Directors fulfil the
criteria laid down by requisite regulations and are independent from the management.
Further, based on these disclosures and confirmations, the Board is of the opinion that
the Directors of the Company are eminent persons with integrity and have necessary
expertise and experience to continue to discharge their responsibilities as the Director
of the Company.
Further, pursuant to the provisions of the CA2013, the shareholders in
the 19th AGM of the Company held on July 17, 2019, had appointed Ms. Vibha Paul
Rishi (DIN: 05180796) as Independent Director of the Company to hold office for five
consecutive years with effect from January 1, 2019, to December 31, 2023. As per section
149(10) of the Companies Act, 2013, an independent director shall be eligible for
re-appointment upon passing a special resolution by the members of the Company and
disclosure of such appointment in the Board's Report.
Accordingly, the Board has recommended the reappointment of Ms. Vibha
Paul Rishi, aged 62 years, as of date, as an Independent Director of the Company, not
liable to retire by rotation, for a second term of five consecutive years commencing from
January 1, 2024, till December 31, 2028, for the approval of the members through a special
resolution to be passed at the 23rd AGM of the Company. Her brief profile and
other details as required under the CA2013 and Listing Regulations pertaining to
re-appointment is provided in the Notice of 23rd AGM of the Company and the
explanatory statement under section 102 of the CA2013, annexed to it.
Board Committees
The details of Board Committees are as follows:
A. Board Audit Committee
The primary objective of the Committee is to monitor and provide an
effective supervision of the financial reporting process, with high levels of
transparency, integrity and quality of financial reporting. The Committee oversees the
functions of internal audit & compliance functions and ensures deployment of policies
for an effective control mechanism including mechanism to address potential conflict of
interest amongst stakeholders. The Committee has the authority and responsibility to
select, evaluate and recommend the statutory auditors in accordance with law. The
Committee ensures independence of control functions demonstrated by a credible reporting
arrangement.
Terms of reference:
i. Accounts & Audit
i. Oversee the financial statements, financial reporting process,
statement of cash flow and disclosure of its financial information, both on an annual and
quarterly basis, to ensure that the financial statement is correct, sufficient and
credible;
ii. Recommend the appointment, reappointment, terms of appointment and,
if required, the replacement or removal; remuneration, reviewing (with management)
performance and oversight of the work of the auditors (internal/ statutory/ concurrent)
and to review and monitor the auditor's independence and performance, and
effectiveness of audit process;
iii. Oversight of the procedures and processes established to attend
issues relating to maintenance of books of account, administration procedures,
transactions and other matters having a bearing on the financial position of the Company,
whether raised by the auditors or by any other person;
iv. Evaluation of internal financial controls and risk management
systems;
v. Discuss with the statutory auditors before the audit commences,
about the nature and scope of audit, as well as, have post-audit discussions to address
areas of concern;
vi. Approval of payment to statutory auditors and internal auditors or
any of its associated persons or companies, for any other services rendered by them;
vii. Reviewing, with the management, the annual financial statements
and auditor's report thereon before submission to the Board for approval, with
particular reference to:
Matters required to be included in the director's
responsibility statement to be included in the Board's report in terms of clause (c)
of subsection (3) of Section 134 of the Companies Act, 2013;
Changes, if any, in accounting policies and practices and
reasons for the same;
Major accounting entries involving estimates based on the
exercise of judgment by management;
Significant adjustments made in the financial statements arising
out of audit findings;
Compliance with listing and other legal requirements relating to
financial statements to the extent applicable;
Approval or any subsequent modification and disclosure of any
related party transactions of the Company, in accordance with applicable provisions, as
amended from time to time; and
Modified opinion(s) in the draft audit report.
viii. Reviewing, with the management, the quarterly, half-yearly and
annual financial statements before submission to the Board for approval;
ix. To the extent applicable, review with the management, the statement
of uses/ end use/application of funds raised through an issue (public issue, rights issue,
preferential issue, etc.) and related matter, the statement of funds utilised for purposes
other than those stated in the offer document/ prospectus/ notice and the report submitted
by the monitoring agency monitoring the utilisation of proceeds of a public or rights
issue, and making appropriate recommendations to the Board to take up steps in this
matter; x. Review of housekeeping items, particularly review of suspense balances,
reconciliations (including subsidiary general ledger (SGL) accounts) and other outstanding
assets & liabilities;
xi. Scrutiny of inter-corporate loans and investments, if any;
xii. Valuation of undertakings or assets of the Company, wherever it is
necessary;
xiii. To review the utilisation of loans and/ or advances
from/investment by the holding company in the subsidiary exceeding
Rs. 100 crore or 10% of the asset size of the subsidiary, whichever is
lower including existing loans/advances/investments.
ii. Internal audit i. Review the adequacy of internal audit function,
if any, including the structure of the internal audit department, staffing and seniority
of the official heading the department, reporting structure, coverage and frequency of
internal audit;
ii. Oversee the efficient functioning of the internal audit department
and review its reports. The Committee would additionally monitor the progress made in
rectification of irregularities and changes in processes wherever deficiencies have come
to notice;
iii. Set-up procedures and processes to address all concerns relating
to adequacy of checks and control mechanisms;
iv. Discussion with internal auditors of any significant findings and
follow up there on;
v. Review the findings of any internal investigations by the internal
auditors into matters where there is suspected fraud or irregularity or a failure of
internal control systems of a material nature and reporting the matter to the Board;
vi. Review with the management, performance of internal auditors and
the adequacy of the internal control systems;
vii. Look into the reasons for substantial defaults in the payment, if
any, to the depositors, debenture holders, shareholders (in case of non-payment of
declared dividends) and creditors; and
viii. Review the functioning of the whistle blower/vigil mechanism.
iii. Compliance & ethics and others
i. Monitor the compliance function and the Company's risk profile
in respect of compliance with external laws and regulations and internal policies,
including the Company's code of ethics or conduct;
ii. Review reports on the above and on proactive compliance activities
aimed at increasing the Company's ability to meet its legal and ethical obligations,
on identified weaknesses, lapses, breaches or violations and the controls and other
measures in place to help detect and address the same;
iii. Discuss the level of compliance in the Company and any associated
risks and to monitor and report to the Board on any significant compliance breaches;
iv. Supervise and monitor matters reported using the Company's
whistle blowing or other confidential mechanisms for employees and others to report
ethical and compliance concerns or potential breaches or violations;
v. Advise the Board on the effect of the above on the Company's
conduct of business and helping the Board set the correct tone at the top' by
communicating, or supporting the communication, throughout the Company of the importance
of ethics and compliance;
vi. Approve compliance programmes, reviewing their effectiveness on a
regular basis and signing off on any material compliance issues or matters;
vii. Review key transactions involving conflict of interest;
viii. Review the anti-money laundering (AML)/ counter financing
of terrorism (CFT) policy annually and review the implementation of the Company's
AML/CFT program;
ix. ReviewcomplianceofInsuranceRegulatory & Development Authority
of India (IRDAI) corporate governance guidelines;
x. Monitor the directives issued/ penalties imposed/ penal action taken
against the Company under various laws and statutes and action taken for corrective
measures; and
xi. Approval of appointment of chief financial officer or any other
person heading the finance function or discharging that function after assessing the
qualifications, experience and background, etc. of the candidate.
xii. Consider and comment on rationale, cost-benefits and impact of
schemes involving merger, demerger, amalgamation etc., on the Company and its
shareholders.
xiii. Carrying out any other function, if any, as is mentioned in the
terms of reference of the Audit Committee and any other terms of reference as may be
decided by the Board and/or specified/ provided under the Companies Act, 2013 or the
Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015, as amended ("Listing Regulations"), or by any other
regulatory authority.
Composition
There were ten meetings of the Board Audit Committee held during
FY2023: Meetings were held on April 14, 2022, April 16, 2022, May 17, 2022, June 17, 2022,
July 15, 2022, July 16, 2022, October12,2022,October15,2022,January12,2023 and January 17,
2023. The details of the composition of the Committee and attendance at its meetings are
set out in the following table:
Name of the member |
Number of meetings attended/ held |
Mr. R. K. Nair Chairman |
10/10 |
Mr. Dileep Choksi |
9/10 |
Mr. Dilip Karnik |
10/10 |
Ms. Vibha Paul Rishi |
10/10 |
Mr. Sandeep Batra |
9/10 |
Mr. Wilfred John Blackburn1 |
4/6 |
Mr. Benjamin Bulmer2 |
4/4 |
1 Ceased to be a non-executive Director of the Company
w.e.f. July 27, 2022 2 Appointed as a non-executive Director of the Company
w.e.f. July 27, 2022
B. Board Risk Management Committee
The Committee reviews the Risk Management policy of the Company,
including asset liability management (ALM), to monitor all risks across the various lines
of business of the Company and establish appropriate systems to mitigate such risks. The
Committee also reviews the risk appetite and risk profile of the Company. The Committee
oversees the effective operation of the risk management system and advises the Board on
key risk issues.
Terms of reference: a. Risk management
i. Establish effective Risk Management framework for identification of
internal and external risks, in particular including financial, operational, sectoral,
sustainability (particularly
ESG related risks), information, cyber security risks, business
continuity risk or any other risk as may be determined by the Committee and recommend to
the Board the Risk Management policy and processes for the organisation which should
include measures for risk mitigation including systems and processes for internal control
of identified risks;
ii. Monitor and oversee implementation of the risk management policy,
including evaluating the adequacy of risk management systems;
iii. Ensure that appropriate methodology, processes and systems are in
place to monitor and evaluate risks associated with the business of the Company; iv.
Assisting the Board in effective operation of the risk management system by performing
specialised analyses and quality reviews;
v. Monitoring and reviewing the cyber security system of the Company;
vi. Maintain a group wide and aggregated view on the risk profile of
the Company in addition to the solo and individual risk profiles;
vii. Report to the Board, the nature and content of its discussions,
recommendations and actions to be taken including details on the risk exposures and the
actions taken to manage the exposures; set the risk tolerance limits and assess the cost
and benefits associated with risk exposure and review, monitor and challenge where
necessary, risks undertaken by the Company;
viii. Advising the Board with regard to risk management decisions in
relation to strategic and operational matters such as corporate strategy, acquisitions and
related matters;
ix. ReviewtheCompany'srisk-rewardperformance to align with overall
policy objectives;
x. Discuss and consider best practices in risk management in the market
and advise the respective functions;
xi. Maintain an aggregated view on the risk profile of the Company for
all categories of risk including insurance risk, market risk, credit risk, liquidity risk,
operational risk, compliance risk, legal risk, reputation risk, etc.;
xii. Review the solvency position of the Company on a regular basis;
xiii. Monitor and review regular updates on business continuity;
xiv. Formulation of a Fraud monitoring policy and framework for
approval by the Board;
xv. Monitor implementation of Anti-fraud policy for effective
deterrence, prevention detection and mitigation of frauds;
xvi. Review compliance with the guidelines on Insurance Fraud
Monitoring Framework dated January 21, 2013, issued by the Authority;
xvii. Review the appointment, removal and terms of remuneration of the
Chief Risk Officer;
xviii. Carry out any other function, if any, as prescribed in the terms
of reference of the BRMC and any other terms of reference as may be decided by the Board
and/or specified/ provided under the Companies Act, 2013 or the Securities and Exchange
Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as
amended, or by any other regulatory authority.
b. Asset liability management (ALM)
i. Formulating and implementing optimal ALM strategies, both at the
product level an enterprise level and meeting risk v/s reward objectives and ensuring they
remain within acceptable monitored tolerances for liquidity, solvency and the risk profile
of the entity;
ii. Reviewing the Company's overall risk appetite and laying down
the risk tolerance limits including annual review of strategic asset allocation;
iii. Monitor risk exposures at periodic intervals and revising
strategies as appropriate including those for ALM;
iv. Placing information pertaining to ALM before the Board at periodic
intervals;
v. Setting the risk/reward objectives i.e. risk appetite of the Company
informed by assessment of policyholder expectations and other relevant factors;
vi. Quantifying the level of risk exposures (e.g. market, credit and
liquidity) and assessing the expected rewards and costs associated with the risk exposure;
vii. Ensuring that management and valuation of all assets and
liabilities comply with the standards, prevailing legislation and internal and external
reporting requirements;
viii. Reviewing key methodologies and assumptions including actuarial
assumptions, used to value assets and liabilities;
ix. Managing capital requirements at the company
levelusingtheregulatorysolvencyrequirements;
x. Reviewing, approving and monitoring capital plans and related
decisions over capital transactions;
xi. To carry out any other function, if any, as prescribed in the terms
of reference of the Risk Management Committee and any other terms of reference as may be
decided by the Board and/or specified/provided under the Companies Act, 2013 or the
Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015, as amended, or by any other regulatory authority;
Composition
There were four meetings of the Board Risk Management Committee held
during FY2023: The meetings were held on April 15, 2022, July 14, 2022, October 14, 2022
and January 11, 2023. The details of the composition of the Committee and attendance at
its meetings are set out in the following table:
Name of the member |
Number of meetings attended/ held |
Mr. M. S. Ramachandran |
4/4 |
Chairman |
|
Mr. R. K. Nair |
4/4 |
Mr. Anup Bagchi |
4/4 |
Mr. Wilfred John Blackburn1 |
1/2 |
Mr. Benjamin Bulmer2 |
2/2 |
1 Ceased to be a non-executive Director of the Company w.e.f. July 27,
2022
2 Appointed as a non-executive Director of the Company w.e.f. July 27,
2022
Note: Mr. Deepak Kinger, Chief Risk & Compliance Officer of the
Company attended all the four meetings of the Board Risk Management Committee.
C. Board Investment Committee
The Investment Committee assists the Board in fulfilling its oversight
responsibility for the investment assets of the Company. The Committee is responsible for
formulating the overall investment policy and establishing a framework for its investment
operations with adequate controls. The Committee also monitors investment performance
against the applicable benchmarks and provide guidance for protection of
shareholders' and policyholders' funds.
Terms of reference:
i. Responsible for the recommendation of the Investment Policy and
laying down of the operational framework for the investment operations of the Company. The
Investment Policy and operational framework should, inter alia, focus on a prudential
asset liability management supported by robust internal control systems; and encompass
aspects concerning liquidity for smooth operations, compliance with prudential regulatory
norms on investments, risk management/mitigation strategies to ensure commensurate yield
on investments in line with policyholders' reasonable expectations and above all
protection of policyholders' funds.
ii. Put in place an effective reporting system to ensure compliance
with the Investment Policy set out by it apart from internal/concurrent audit mechanisms
for a sustained and ongoing monitoring of investment operations.
iii. To submit a report to the Board on the performance of investments
at least on a quarterly basis and provide an analysis of its investment portfolio
(including with regard to the portfolio's safety and soundness) and on the future
outlook.
iv. The Committee should independently review its investment decisions
and ensure that support by the internal due diligence process is an input in making
appropriate investment decisions.
v. To carry out any other function, if any, as prescribed in the terms
of reference of the Board Investment Committee and any other terms of reference as may be
decided by the Board and/ or specified/provided under the CA2013 or by any other
regulatory authority.
Composition
There were four meetings of the Board Investment Committee held during
FY2023: The meetings were held on April 15, 2022, July 15, 2022, October 14, 2022 and
January 12, 2023. The details of the composition of the Committee and attendance at its
meetings are set out in the following table:
Name of the member |
Number of meetings attended/ held |
Mr. M. S. Ramachandran |
4/4 |
Chairman |
|
Mr. R. K. Nair |
4/4 |
Mr. Sandeep Batra |
4/4 |
Mr. Wilfred John Blackburn1 |
1/2 |
Mr. Benjamin Bulmer2 |
2/2 |
Mr. N. S. Kannan |
4/4 |
*Mr. Satyan Jambunathan |
4/4 |
*Mr. Manish Kumar |
4/4 |
*Mr. Deepak Kinger |
4/4 |
*Mr. Souvik Jash |
4/4 |
1 Ceased to be a non-executive Director of the Company w.e.f.
July 27, 2022
2 Appointed as a non-executive Director of the Company w.e.f.
July 27, 2022 * As per IRDAI Corporate Governance guidelines 2016 and the IRDAI Investment
Regulations, 2016, the Board Investment Committee shall also have Chief Financial Officer,
Chief Risk Officer, Chief Investment Officer and Appointed Actuary as members.
D. Board Customer Service & Policyholders' Protection
Committee
The Board Customer Service & Policyholders' Protection
Committee assists the Board to protect the interests of the policyholders and improve
their experiences in dealing with the Company at all stages and levels of their
relationship with the Company. In this connection, the Committee aims to upgrade and
monitor policies and procedures for grievance redressal and resolution of disputes,
disclosure of "material information" to the policy holders, and compliance with
the regulatory requirements.
Terms of reference:
i. Putting in place proper procedures and effective mechanism to
address complaints and grievances of policyholders including mis-selling by
intermediaries.
ii. Ensure compliance with the statutory requirements as laid down in
the regulatory framework pertaining to policyholders' protection.
iii. Review of the mechanism at periodic intervals.
iv. Ensure adequacy of disclosure of "material information"
to the policyholders. These disclosures shall, for the present, comply with the
requirements laid down by the Authority both at the point of sale and at periodic
intervals.
v. Review the status of complaints of the policyholders, and take steps
to reduce these complaints, at periodic intervals.
vi. Provide the details of grievances at periodic intervals in such
formats as may be prescribed by the Authority
vii. Provide details of insurance ombudsmen to the policyholders. viii.
Shape the customer service philosophy and policies of the organisation based on the
overall environment in the financial services industry.
ix. Oversee the functions of the customer service council.
x. Review measures for enhancing the quality of customer service.
xi. Provide guidance to improve in the overall satisfaction level of
customers.
xii. Adopt standard operating procedures to treat the customer fairly
including time-frames for policy and claims servicing parameters and monitoring
implementation thereof.
xiii. Put in place a framework for review of awards given by Insurance
Ombudsman/Consumer Forums. Analyse the root cause of customer complaints, identify market
conduct issues and advise the management appropriately about rectifying systemic issues,
if any.
xiv. Review all the awards given by Insurance Ombudsman/Consumer Forums
remaining unimplemented for more than three (3) months with reasons therefor and report
the same to the Board for initiating remedial action, where necessary.
xv. Review of claims report, including status of outstanding claims
with ageing of outstanding claims. xvi. Reviewing repudiated claims with analysis of
reasons.
xvii. Status of settlement of other customer benefit payouts like
surrenders, loan, and partial withdrawal requests etc.
xviii. Review of unclaimed amounts of policyholders, as required under
the circulars and guidelines issued by the Authority.
The Grievance Redressal Committee (GRC) is chaired by an eminent
independent member Mr. Rajagopalan Venkatarama. The other members of the Committee
comprise of Ms. Poonam Bharadwaj, an independent member and three other internal members.
As part of the grievance redressal mechanism, the GRC is constituted as the final
authority to address the policyholders' grievances before approaching the Regulator
and the Ombudsman office. A summary of the key discussions of the GRC meeting are put up
at the Board Customer Service & Policyholders' Protection Committee for
information.
The GRC meets on a quarterly basis with the following terms of
reference:
a. Evaluate feedback on quality of customer service and claims
experience.
b. Review and approve representations received on claims repudiations
and complaints.
c. Ensure that the Company follows all prescribed regulatory
requirements on policyholder service.
d. Submit report on its performance to the Customer Service &
Policyholder Protection Committee (CS&PPC) on a quarterly basis.
Composition
There were four meetings of the Board Customer Service &
Policyholders' Protection Committee held during FY2023: Meetings were held on April
14, 2022, July 13, 2022, October 12, 2022 and January 11, 2023. The details of the
composition of the Committee and attendance at its meetings are set out in the following
table:
Name of the member |
Number of meetings attended/ held |
Ms. Vibha Paul Rishi |
4/4 |
Chairperson |
|
Mr. Dilip Karnik |
4/4 |
Mr. Dileep Choksi |
4/4 |
Mr. Anup Bagchi |
4/4 |
Mr. Wilfred John Blackburn1 |
1/2 |
Mr. Benjamin Bulmer2 |
2/2 |
1 Ceased to be a non-executive Director of the Company
w.e.f. July 27, 2022 2 Appointed as a non-executive Director of the Company
w.e.f. July 27, 2022
Note: The Board of Directors of the Company appointed Mr. Rajagopalan
Venkatarama, an independent person as the customer representative on the Board Customer
Service & Policyholders' Protection Committee with effect from July 16, 2022. He
attended the Committee meeting held on July 13, 2022 as an invitee and the Committee
meetings held on October 12, 2022 and January 11, 2023 as a customer representative.
E. Board Nomination and Remuneration Committee
The Board Nomination and Remuneration Committee assists the Board to
formulate policies relating to the composition and remuneration of the Directors, key
managerial personnel, other employees consistent with criteria approved by the Board. The
Committee coordinates and oversee the self-evaluation of the performance of the Board and
succession planning for senior management. The Committee ensures that the Board comprises
of competent and qualified Directors.
Terms of reference:
i. To formulate the criteria for determining qualifications, positive
attributes and independence of a director and recommend to the Board a policy, relating to
the remuneration for the directors, key managerial personnel and other employees;
ii. To consider and approve employee stock option schemes and to
administer and supervise the same;
iii. To devise a policy on diversity of the Board; iv. To identify
persons who are qualified to become directors and who may be appointed in senior
management in accordance with the criteria laid down, recommend to the Board their
appointment and removal and formulate a criteria and specify the manner for effective
evaluation of every individual director's performance, evaluation of the performance
of Board and its committees; and review its implementation and compliance;
v. To recommend to the Board, all remuneration, in whatever form,
payable to senior management;
vi. To scrutinise the declarations of intending applicants before the
appointment/ reappointment/ election of directors by the shareholders at the annual
general meeting; and to scrutinise the applications and details submitted by the aspirants
for appointment as the key managerial personnel;
vii. To consider whether to extend or continue the term of appointment
of the independent director, on the basis of the report of performance evaluation of
independent directors;
viii. To ensure that the level and composition of remuneration is
reasonable and sufficient to attract, retain and motivate directors of the
qualityrequiredtoruntheCompanysuccessfully;
ix. To ensure that relationship of remuneration to performance is clear
and meets appropriate performance benchmarks;
x. To approve the compensation program and to ensure that remuneration
to directors, key managerial personnel and senior management involves a balance between
fixed and incentive pay reflecting short and long term performance objectives appropriate
to the working of the Company and its goals;
xi. To ensure that the proposed appointments/ re-appointments of key
managerial personnel or directors are in conformity with the Board approved policy on
retirement/ superannuation; and
xii. To carry out any other function, if any, as prescribed in the
terms of reference of the Board Nomination and Remuneration Committee and any other terms
of reference as may be decided by the Board and/or specified/ provided under the Companies
Act, 2013 or the Securities and Exchange Board of India (Listing Obligations and
Disclosure Requirements) Regulations, 2015, as amended, or by any other regulatory
authority.
Composition
There were six meetings of the Board Nomination and Remuneration
Committee held during FY2023: April 16, 2022, May 17, 2022, July 15, 2022, October 12,
2022, January 12, 2023 and March 16, 2023. The details of the composition of the Committee
and attendance at its meetings are set out in the following table:
Name of the member |
Number of meetings attended/ held |
Mr. Dilip Karnik Chairman |
6/6 |
Mr. M. S. Ramachandran |
6/6 |
Mr. Dileep Choksi |
6/6 |
Ms. Vibha Paul Rishi |
6/6 |
Mr. Sandeep Batra |
6/6 |
Mr. Wilfred John Blackburn1 |
2/3 |
Mr. Benjamin Bulmer2 |
3/3 |
1 Ceased to be a non-executive Director of the Company w.e.f. July 27,
2022
2 Appointed as a non-executive Director of the Company w.e.f. July 27,
2022
F. Board Sustainability and Corporate Social Responsibility Committee
The purpose of the Committee is to formulate and recommend to the Board
the CSR policy of the Company, formulate the annual CSR plan, and monitor the CSR
activities and compliance with the CSR policy from time to time. Corporate Social
Responsibility Policy of the Company as per section 135 of the CA2013 is put up on the
Company's website. Further, the terms of reference of the Board Corporate Social
Responsibility Committee, was amended to oversee and monitor the matters related to
Sustainability including Environment, Social and Governance (ESG) and Business
Responsibility and Sustainability initiatives undertaken by the Company. In order to give
effect to the enhanced scope, the nomenclature of the Board Corporate Social
Responsibility Committee was renamed as "Board Sustainability and Corporate Social
Responsibility Committee".
Terms of reference:
i. To formulate and recommend to the Board, a Corporate Social
Responsibility Policy which shall indicate the activities to be undertaken by the Company.
ii. To recommend the amount of expenditure to be incurred on the
Corporate Social Responsibility activities.
iii. To monitor the Corporate Social Responsibility Policy of the
Company from time to time.
iv. To oversee and monitor Sustainability activities including ESG
initiatives undertaken by the Company, related key disclosures, review its performance
thereon and advice on related matters.
v. To review and monitor matters related to Sustainability such as the
ESG Report, Business Responsibility and Sustainability Report.
Composition
TherewerethreemeetingsoftheBoardSustainability and Corporate Social
Responsibility Committee held during FY2023: Meeting were held on April 14, 2022,
October 14, 2022 and January 13, 2023. The details of the composition
of the Committee and attendance at its meetings are set out in the following table:
Name of the member |
Number of meetings attended/ held |
Mr. Dilip Karnik Chairman |
3/3 |
Mr. Dileep Choksi |
3/3 |
Mr. Wilfred John Blackburn1 |
1/1 |
Mr. Benjamin Bulmer2 |
2/2 |
1 Ceased to be a non-executive Director of the Company w.e.f. July 27,
2022
2 Appointed as a non-executive Director of the Company w.e.f. July 27,
2022
G. Stakeholders Relationship Committee Terms of reference:
i. Consider and review redressal and resolutions of the grievances and
complaints of the security holders of the company, including those of shareholders,
debenture holders and other security holders related to transfer/ transmission of shares,
non-receipt of annual report, non-receipt of declared dividends, issue of new/duplicate
certificates, general meetings;
ii. Approval and rejection of transfer and transmission of shares or
securities, including preference shares, bonds, debentures and securities;
iii. Approval and rejection of requests for split and consolidation of
share certificates;
iv. Approval and rejection of issue of duplicate share, issued from
time to time;
v. Redemption of securities and the listing of securities on stock
exchanges;
vi. Allotment of shares and securities;
vii. Review of measures taken for effective exercise of voting rights
by shareholders;
viii. Review of adherence to the service standards adopted by the
Company in respect of various services being rendered by the Registrar & Share
Transfer Agent;
ix. Review of various measures and initiatives taken by the Company for
reducing the quantum of unclaimed dividends and ensuring timely receipt of dividend
warrants/annual reports/statutory notices by the shareholders of the company; and
x. Any other activities which are incidental or ancillary to the
various aspects of interests of shareholders, debenture holders and/or other security
holders.
Composition
There were four meetings of the Stakeholders Relationship Committee
held during FY2023: April 14, 2022, July 15, 2022, October 14, 2022 and January 11, 2023.
The details of the composition of the Committee and attendance at its meetings are set out
in the following table:
Name of the member |
Number of meetings attended/ held |
Mr. Dileep Choksi |
4/4 |
Chairman |
|
Mr. R. K. Nair |
4/4 |
Mr. N. S. Kannan |
4/4 |
Ms. Sonali Chandak, Company Secretary is
designatedastheComplianceOfficeroftheCompany in accordance with the requirements of
Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015. The total number of complaints from shareholders in FY2023 were 71,
majority being related to non-receipt of dividend, exemption for tax deductible at source
on dividend and change of bank mandate. All these complaints have been addressed within
the prescribed timeline. At March 31, 2023, no complaints were pending for resolution.
H. With Profits Committee Terms of reference:
i. Maintaining the asset shares.
ii. Providing approval for the detailed working of the asset share, the
expense allowed for in the asset share, the investment income earned on the fund, and
other associated elements which were represented in the asset share determined by the
Appointed Actuary.
iii. To submit a report to the Board covering at least:
appropriateness of the methodology and basis used in calculation
of asset shares and justification for any change,
bonus earning capacity including its calculation,
sensitivity analysis of bonus rates and basis as appropriate,
a brief note on how policyholders' reasonable expectations
(PRE) is met,
any change in special surrender value with justification,
treatment of With Profit fund for future appropriation, and
the expenses debited to the With Profit fund and its
appropriateness.
Composition
There was one meeting of the With Profits Committee held during FY2023:
Meeting was held on April 14, 2022. The details of the composition of the Committee and
attendance at its Meeting are set out in the following table:
Name of the member |
Number of meetings attended/ held |
Mr. R. K. Nair Chairman |
1/1 |
Mr. Sandeep Batra |
1/1 |
Mr. Wilfred John Blackburn1 |
1/1 |
Mr. Benjamin Bulmer2 |
0/0 |
Mr. N. S. Kannan |
1/1 |
*Mr. Chandan Khasnobis3 |
1/1 |
* Mr. Heerak Basu4 |
0/0 |
* Mr. Satyan Jambunathan |
1/1 |
* Mr. Souvik Jash |
1/1 |
* As per IRDAI (Non-linked Insurance Products) Regulations 2019, With
Profits Committee shall also have the Chief Financial Officer, the Appointed Actuary and
an Independent Actuary, as members.
1 Ceased to be a non-executive Director of the Company w.e.f. July 27,
2022
2 Appointed as a non-executive Director of the Company w.e.f. July 27,
2022
3 Ceased to be a member with effect from October 15, 2022
4 Appointed as a member with effect from October 15, 2022
I. Strategy Committee
The Board of Directors at its Meeting held on January 19, 2018 had
constituted a Strategy Committee to consider and evaluate any combination, arrangement,
transfer of assets, acquisition, divestiture and any other strategic initiative and
recommend such proposals to the Board of Directors.
Terms of reference
i. To evaluate transaction(s) of transfer of assets, combination,
arrangement, acquisition, divestitures and any other strategic initiatives proposed to be
undertaken by the Company (through the processes entailing technical/price bids, due
diligence process, etc.) and submit the proposal to the Board for its consideration.
ii. To take all necessary actions in connection with such specific
transactions.
Composition
There was one meeting of the Strategy Committee held during FY2023:
Meeting was held on May 17, 2022. The details of the composition of the Committee and
attendance at its Meeting are set out in the following table:
Name of the member |
Number of meetings attended/ held |
Mr. M. S. Ramachandran |
1/1 |
Chairman |
|
Mr. Anup Bagchi |
1/1 |
Mr. Wilfred John Blackburn1 |
1/1 |
Mr. Benjamin Bulmer2 |
0/0 |
Mr. N. S. Kannan |
1/1 |
1 Ceased to be a non-executive Director of the Company w.e.f. July 27,
2022
2 Appointed as a non-executive Director of the Company w.e.f. July 27,
2022
Familiarisation programme for Independent Directors
Independent Directors are familiarised with their roles, rights and
responsibilities in the Company as well as with the nature of the industry and the
business model of the Company through induction programmes at the time of their
appointment as Directors and through presentations on economy and industry overview,
business overview, key regulatory developments, governance, strategy, investment, human
resource and operating performance which are made to the Directors from time to time. The
details of the familiarisation programmes have been hosted on the website of the Company
and can be accessed on the link: https:// www.iciciprulife.com/about-us/company-overview/
familiarization.html.
Changes in the composition of the Board of Directors and other key
managerial personnel (KMP) as per CA2013 during the year ended March 31, 2023
Name of Director/KMP |
Appointment/ Resignation/ Cessation of
tenure/Withdrawal of nomination |
With effect from |
Mr. Wilfred John Blackburn |
Resignation |
July 27, 2022 |
Mr. Benjamin Bulmer |
Appointment |
July 27, 2022 |
Separate meeting of independent Directors
During FY2023, a separate meeting of the Independent Directors was held
on April 16, 2022.
Retirement by rotation
In accordance with Section 149, Section 152 of the CA2013 and the
Articles of Association of the Company, Mr. Anup Bagchi (DIN: 00105962) would retire by
rotation at the ensuing AGM. Mr. Anup Bagchi, being eligible has offered himself for
re-appointment.
Criteria for appointment of a Director and official(s) who may be
appointed as key managerial person/ personnel or as senior managerial personnel
The Company has a well-defined criteria for appointment of Directors
and those in senior management positions (that is who may be appointed as key managerial
person/personnel (KMP) or as senior managerial personnel (SMP)) in accordance with the
requirements prescribed.
Remuneration Remuneration policy
The Company has in place a policy on Compensation
& Benefits ("Compensation Policy") for Managing Director
& CEO, other whole-time Directors, non-executive Directors, Key Management Person
(KMP), Senior Management Personnel (SMP) and other employees.
Further details with respect to the Compensation policy are provided
under the section titled "Compensation & Benefit policy", which has also
been hosted on the website of the Company and can be accessed on the link:
https://www.iciciprulife. com/about-us/corporate-policies.html.
Details of remuneration paid to whole-time Directors
The Board Nomination and Remuneration Committee (BNRC) determines and
recommends to the Board the remuneration, including performance bonus and non-cash
benefits and perquisites, payable to the whole-time Directors.
The following table sets out the details of remuneration (including
perquisites and retiral benefits) paid to the whole-time Director during FY2023:
Particulars |
Details of Remuneration (`) Mr. N. S.
Kannan |
Basic |
27,231,840 |
Variable pay |
14,610,131 |
Allowances1 and perquisites2 |
24,495,400 |
Contribution to provident fund |
3,267,816 |
Contribution to gratuity fund3 |
2,268,408 |
Stock options of the Company (Numbers) |
|
Granted in FY2023 |
435,500 |
Granted in FY2022 |
721,300 |
Note: For the year ended March 31, 2023 the remuneration details
pertain to the amount paid/options granted during the period of service as per IRDAI
approval
1 Allowances also include Superannuation
2 Perquisites are evaluated as per Income-Tax rules wherever
applicable, and exclude perquisites on Provident Fund and perquisites on exercise of stock
options, if any. Stock options exercised during the year does not constitute remuneration
paid to the whole-time directors and accordingly is not considered here.
3 Provision towards gratuity is actuarially valued for the group of all
eligible employees on an overall basis, however, for the purpose of this section, annual
contribution towards gratuity fund of the Company as approved by BNRC/Board has been
given.
Details of remuneration paid to non-executive Directors
As provided in the Articles of Association of the Company, the fees
payable to the non-executive independent Directors for attending a Meeting of the Board or
Committee thereof is decided by the Board of Directors from time to time within the limits
prescribed by the CA2013. For FY2023, the Company has paid Rs. 100,000 as sitting fees for
each meeting of the Board, Rs. 100,000 for each Board Audit Committee meeting and
Rs. 50,000 as sitting fees for each Meeting of other Board Committee
meetings attended. This amount is within the limits prescribed as per Rule 4 of Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014 of the CA2013.
The members of the Company at the Annual General
Meeting held on July 17, 2019, have approved the payment of
compensation in form of profit related commission upto Rs. 1 million per annum, in
proportion to the time served by him/her as a Director in a year, to each non-executive
Director of the Company (other than the non-executive directors nominated by ICICI Bank
Limited and Prudential Corporation Holdings Limited). The payments are subject to the
regulatory provisions applicable to the Company and availability of net profits at the end
of each financial year. Sitting fees paid to independent Directors are outside the purview
of the above limits. Further, Mr. M. S. Ramachandran, non-executive
IndependentDirector,ChairmanoftheCompany,was also provided an office, including its
maintenance, at the Company's expense, for attending to his duties as the Chairman of
the Company pursuant to the resolution passed by the members of the Company on October 30,
2020, through postal ballot. The details of the sitting fees and commission are as below:
Sitting fees paid to independent Directors for the financial year ended
March 31, 2023:
Name of the Director |
Amount (in `) |
Mr. M. S. Ramachandran, Chairman |
1.45 million |
Mr. Dilip Karnik |
2.35 million |
Mr. R. K. Nair |
2.35 million |
Mr. Dileep Choksi |
2.25 million |
Ms. Vibha Paul Rishi |
2.20 million |
Commission to be paid to independent Directors for the financial year
ended March 31, 2023:
Name of the Director |
Amount (in Rs. ) |
Mr. M. S. Ramachandran, Chairman |
1 million |
Mr. Dilip Karnik |
1 million |
Mr. R. K. Nair |
1 million |
Mr. Dileep Choksi |
1 million |
Ms. Vibha Paul Rishi |
1 million |
Remuneration disclosures pursuant to IRDAI guidelines
Pursuant to IRDAI guidelines on remuneration of non-executive Directors
and Managing Director/ Chief Executive Officer/Whole-time Directors of Insurers (IRDAI
Guidelines) issued vide reference no. IRDA/F&A/GDL/LSTD/155/08/2016 dated August 5,
2016, requires the Company to make the following disclosures on remuneration in the Annual
Report:
Compensation policy and practices
1. Qualitative disclosures a. Information relating to the design and
structure of remuneration processes and the key features and objectives of remuneration
policy.
(i) Name and mandate of the main body overseeing remuneration: The
Board Nomination and Remuneration Committee (BNRC/ Committee) is the body which oversees
aspects pertaining to remuneration. The functions of the Committee include identifying
persons who are qualified to become Directors and who may be appointed in senior
management in accordance with the criteria laid down as well as recommending to the Board
their appointment and removal; and formulating the criteria for determining
qualifications, positive attributes and independence of a Director; and also devising a
policy on diversity of the Board. The Committee ensures that the proposed
appointments/re-appointments of key management person or Directors are in conformity with
the Board approved policy on retirement/ superannuation; scrutinises the declarations of
intending applicants before the appointment/reappointment/election of Directors by the
shareholders at the Annual General Meeting; and scrutinises the applications and details
submitted by the aspirants for appointment as the key management person. The Committee
also formulates criteria and specifies the manner for effective evaluation of every
individual director's performance, and that of the Board and its committees, and
reviews its implementation and compliance. The Committee considers the extension or
continuation of the term of appointment of the Independent Directors, on the basis of the
report of performance evaluation of Independent Directors. In addition, the Committee
recommends to the Board the policy relating to the remuneration for the Directors, key
management persons and other employees; and recommends to the Board all remuneration, in
whatever form, payable to senior management; and considers and approves employee stock
option schemes and administers and supervises the same. The Committee ensures that the
level and composition of remuneration is reasonable and sufficient to attract, retain and
motivate Directors of the quality required to run the Company successfully; and that the
relationship of remuneration to performance is clear and meets appropriate performance
benchmarks; along with approving the compensation program and ensuring that remuneration
to Directors, key management person and senior management involves a balance between fixed
and incentive pay reflecting short and long term performance objectives appropriate to the
working of the Company and its goals.
(ii) External consultants whose advice has been sought, the body by
which they were commissioned and in what areas of the remuneration process: The Company
engaged the services of reputed consulting firms for market benchmarking in the area of
compensation.
(iii) Scope of the Company's remuneration policy (eg. by regions,
business lines), including the extent to which it is applicable to foreign subsidiaries
and branches.
The Company's Policy on
Compensation & Benefits ("Compensation Policy") for
Managing Director & CEO, other Whole-time Directors, non-executive Directors, Key
Management Person (KMP), Senior Management Personnel (SMP) and other employees was last
amended and approved by the BNRC and the Board at its Meetings held on April 16, 2022.
(iv) Type of employees covered and number of such employees: All
employees of the Company are governed by the Compensation Policy. The total number of
permanent employees governed by the Compensation Policy of the Company at March 31, 2023
was 17,825.
(v) Key features and objectives of remuneration policy: The Company has
historically followed prudent compensation practices under the guidance of the Board and
the BNRC. The Company's approach to compensation is based on the ethos of meritocracy
and fairness within the framework of prudent risk management. This approach has been
incorporated in the Compensation Policy, the key elements of which are given below:
Effective governance of compensation
The Company follows prudent compensation practices under the guidance
of the BNRC and the Board. The decision relating to the remuneration of the Managing
Director & CEO (MD & CEO) and other Whole-time Directors is reviewed and approved
by the BNRC and the Board. The BNRC and the Board approves the Key Performance Indicators
(KPIs) and the performance threshold for payment of performance bonus, if applicable. The
BNRC evaluates business performance against the KPIs and on various risk parameters as
prescribed by IRDAI. Based on its assessment, it makes recommendations to the Board
regarding compensation for MD & CEO and other Whole-time Directors, performance bonus
and long-term pay for all eligible employees, including senior management and key
management persons.
Alignment of compensation philosophy with prudent risk taking
The Company seeks to achieve a prudent mix of fixed and variable pay,
with a higher proportion of variable pay at senior levels. For the MD & CEO and other
Whole-time Directors (WTD), compensation is sought to be aligned to both pre-defined
performance objectives of the Company as well as prudent risk parameters. In addition, the
Company has an Employees Stock Option Scheme aimed at enabling employees to participate in
the long-term growth and financial success of the Company through stock option grants that
vest over a period of time.
Whether the BNRC reviewed the Company's remuneration policy during
the past year, and if so, an overview of any changes that were made
The BNRC reviewed the Company's Compensation and Benefits policy
at its meeting held on April 16, 2022. The key changes in the policy are:
The clause on variable pay for the Managing Director & CEO
and Other Whole-time Directors (in Part B of the Compensation Policy) has been modified to
defer a minimum of 50% of the bonus amount for Managing Director & CEO and other
Whole-time Directors. If the bonus is under
Rs. 25 lacs, the deferment shall not be applicable. The deferral period
would be spread over a minimum period of three years (deferment period). The frequency of
vesting will be on annual basis and the first vesting shall not be before one year from
the commencement of deferral period. The vesting shall be no faster than a prorata basis.
Additionally, vesting will not be more frequent than on a yearly basis.
b. Description of the ways in which current and future risks are taken
into account in the remuneration processes.
The Company follows prudent
compensationpracticesundertheguidance of the Board and the Board Nomination and
Remuneration Committee (BNRC). The Company's approach to compensation is based on the
ethos of meritocracy and fairness within the framework of prudent risk management. The
performance rating assigned to employees is based on assessment of performance delivered
against a set of defined performance objectives. These objectives are balanced in nature
and comprise a holistic mix of financial, customer, people, process, quality, compliance
objectives and/or any other parameters as may be deemed fit.
For the MD & CEO and other Whole-time Directors,
compensation is sought to be aligned to both pre-defined performance objectives of the
Company as well as prudent risk parameters.
For the MD & CEO and other Whole-time Directors, the quantum
of bonus does not exceed a certain percentage (as stipulated in the Compensation Policy)
of total fixed pay in a year; a minimum of 50% (as stipulated in the Compensation Policy)
will be under deferment. If the bonus amount is under Rs. 25 lacs, the deferment shall not
be applicable. The deferral period would be spread over a minimum period of three years
(deferment period). The frequency of vesting will be on annual basis and the first vesting
shall not be before one year from the commencement of deferral period. The vesting shall
be no faster than a prorata basis. Additionally, vesting will not be more frequent than on
a yearly basis.
The deferred part of the variable pay (performance bonus) for
Whole-time Directors is subject to malus, under which, the Company will prevent vesting of
all or part of the variable pay in the event of an enquiry determining gross negligence or
integrity breach.
In claw back arrangements with Whole-time Directors, the
employee agrees to return, in case asked for, the previously paid variable pay to the
Company in the event of an enquiry determining gross negligence or integrity breach,
taking into account relevant regulatory stipulations.
For malus and clawback, acts of gross negligence and integrity
breach are covered under the purview of the compensation policy. Errors of judgment shall
not be construed to be breaches.
c. Description of the ways in which the Company seeks to link
performance during a performance measurement period with levels of remuneration
The Company's approach to compensation is based on the ethos of
meritocracy and fairness within the framework of prudent risk management. The extent of
variable pay for individual employees is linked to individual performance for sales
frontline employees and to individual and organisation performance for non-sales frontline
employees and employees in the management cadre. For the latter, the performance rating
assigned is based on assessment of performance delivered against a set of defined
performance objectives. These objectives are balanced in nature, and comprise a holistic
mix of financial, customer, people, process, quality and compliance objectives and/or any
other parameters as may be deemed fit. For the Managing Director & CEO and other
Whole-time Directors, to ensure effective alignment of compensation with prudent risk
parameters, the Company takes into account various risk parameters along with other
pre-defined performance objectives of the Company.
2. Quantitative Disclosures
The following table sets forth, for the period indicated, the details
of quantitative disclosure for remuneration of the Managing Director & CEO:
Particulars |
At March 31, 2023 |
Number of WTD/ CEO/ MD having received a variable
remuneration award during the financial year |
1 |
Number and total amount of sign on awards made during the
financial year |
Nil |
Details of guaranteed bonus, if any, paid as joining/ sign on
bonus |
Nil |
Breakup of amount of remuneration awarded for the financial
year (in Rs. million) |
|
Fixed1 |
56.2 |
Variable Pay2 |
29.2 |
Deferred |
14.6 |
Non-Deferred |
14.6 |
Share-Linked Instruments Company2 |
4,35,500 |
Total amount of deferred remuneration paid out in the
financial year |
|
Cash (Rs. in million) |
Nil |
Shares |
|
Shares-linked instruments (Employee Stock Options) pending to
be vested as on March 31, 2023 |
|
Company |
12,44,650 |
ICICI Bank3 |
Nil |
Other forms |
Nil |
1 Fixed pay includes basic salary, supplementary allowances,
superannuation, contribution to provident fund and gratuity fund by the Company. Provision
towards gratuity is actuarially valued for the group of all eligible employees on an
overall basis, however, for the purpose of this section, the annual contribution towards
gratuity fund of the Company as approved by BNRC/Board is incorporated here.
2 Variable pay and share-linked instruments represent amounts
granted/options awarded by BNRC/Board in FY2023.
3 Employee stock options last granted in May 2019
Further, provision on gratuity, leave encashment and long term payment,
which is actuarially valued for all employees of the organisation, is not considered
above.
Disclosures required with respect to Section 197(12) of the CA2013
The ratio of the remuneration of each Director to the median
employee's remuneration and such other details in terms of Section 197(12) of the
CA2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014. For the purpose of this section, aspects of fixed remuneration
which includes basic salary, supplementary allowance and retirals (provident fund,
gratuity and superannuation) have been annualised.
(i) The ratio of the remuneration of each director to the median
remuneration of the employees, who are part of annual bonus plan (excluding frontline
sales), of the Company for the financial year:
Mr. N S Kannan, |
|
|
76:1 |
Managing Director & CEO |
|
(ii) The percentage increase in remuneration of each Whole-time
Director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager,
if any, in the financial year:
The percentage increase in remuneration of Whole-time Director i.e.
Managing Director
& CEO, Chief Financial Officer, and Company Secretary ranged
between 6% and 8%.
(iii) The percentage increase in the median remuneration of employees,
who are part of annual bonus plan (excluding frontline sales), in the financial year:
The percentage increase in the median remuneration of employees, who
are part of annual bonus plan, in the financial year was around 14.7%
(iv) The number of permanent employees on the rolls of Company:
The number of employees as on March 31, 2023 is 17,825.
(v) Average percentile increase already made in the salaries of
employees other than the managerial personnel in the last financial year and its
comparison with the percentile increase in the managerial remuneration and justification
thereof and point out if there are any exceptional circumstances for increase in the
managerial remuneration:
The average percentage increase in the salaries of total employees
other than the key management persons for fiscal 2022 was around 15.1%, while the average
increase in the remuneration of the key management person was in the range of 6% to 8%.
(vi) Affirmation that the remuneration is as per the remuneration
policy of the Company:
Yes
Employee Stock Option Scheme (ESOS)
The Company granted options to its employees under its Employees Stock
Option Scheme, prior to listing, further to the approval of its Employees Stock Option
Scheme 2005. This pre-IPO Scheme shall be referred to as ESOS 2005' or
Scheme'. The Scheme had six tranches namely Founder, 2004-05, 2005-06, 2006-07,
Founder II and 2007-08, pursuant to which shares have been allotted and listed in
accordance with the in-principle approval extended by the stock exchanges. All six
tranches under the pre-IPO Scheme stand lapsed as on March 31, 2023. The Scheme was
instituted vide approval of its members at the Extra-Ordinary General Meeting (EGM) dated
March 28, 2005 and subsequently amended by the members of the Company vide its EGM dated
February 24, 2015.
The Scheme was ratified and amended by the members of the Company at
its Annual
General Meeting held on July 17, 2017 which is in compliance with the
SEBI (Share Based Employee Benefits) Regulations, 2014 (referred to as the Revised
Scheme'). The meeting of Board Nomination and Remuneration Committee (BNRC) and the
Board held on April 24, 2019 had approved the amendment to the definition of
"Exercise Period". The revision to the definition was approved by the members of
the Company at its Annual General Meeting held on July 17, 2019.
Further, the meeting of Board Nomination and Remuneration Committee
(BNRC) and the Board held on April 17, 2021 and April 19, 2021 respectively had approved
the increase in the limit of the number of shares issued or issuable since March 31, 2016
pursuant to the exercise of any Options granted to the Eligible Employees issued pursuant
to the Scheme or any other stock option scheme of the Company, by 0.90% of the number of
shares issued as on March 31, 2016, i.e. from a limit of 2.64% of the number of shares
issued as on March 31, 2016 to 3.54%. The revision to the limit was approved by the
members of the Company at its Annual General Meeting held on June 25, 2021.
As per the Revised Scheme, the aggregate number of shares issued or
issuable since March 31, 2016 pursuant to the exercise of any Options granted to the
Eligible Employees issued pursuant to the Scheme or any other stock option scheme of the
Company, shall not exceed 3.54% of the number of shares issued at March 31, 2016. Further,
pursuant to the Revised Scheme the maximum number of Options that can be granted to any
Eligible Employee in a financial year shall not exceed 0.1% of the issued Shares of the
Company at the time of grant of Options. The Revised Scheme provides for a minimum period
of one year between the grant of Options and vesting of Options. The exercise price shall
be determined by the Board Nomination & Remuneration Committee in concurrence with the
Board of Directors of the Company on the date the options are granted and shall be
reflected in the award confirmation. Shares are allotted/issued to all those who have
exercised their Options, as granted by the Board/BNRC of the Company in accordance with
the criteria ascertained pursuant to the Company's Compensation and Benefit policy.
Pursuant to the SEBI (Share Based Employee Benefits) Regulations, 2014, the disclosures
are available on the website of the Company at the following link
https://www.iciciprulife.com/about-us/ corporate-policies.html.
The salient features of tranches issued under the Revised Scheme are as
stated below:
|
|
|
|
|
Graded Vesting Period |
|
|
Scheme |
Date of Grant |
Number of options granted |
Maximum term for exercising
the options granted |
1st Year |
2nd Year |
3rd Year |
4th Year |
Mode of settlement |
2017-18 |
July 25, 2017 |
656,300 |
Exercise period would
commence from the date of vesting and expire on completion of ten years from the date of
vesting of stock options |
30% of options granted |
30% of options granted |
40% of options granted |
- |
|
2018-19 |
April 24, 2018 |
2,167,900 |
|
|
|
|
|
|
2018-19 |
April 24, 2018 |
4,980,250 |
|
- |
- |
50% of options |
50% of options |
|
Special Options |
|
|
|
|
|
granted |
granted |
|
2018-19 |
January 22, 2019 |
156,000 |
|
|
|
|
|
|
Joining Options |
|
|
|
|
|
|
|
|
2019-20 |
April 24, 2019 |
4,993,600 |
|
|
|
|
|
|
2019-20 |
July 24, 2019 |
80,000 |
|
|
|
|
|
|
Joining Options |
|
|
|
|
|
|
|
Equity |
2020-21 |
May 10, 2020 |
5,072,200 |
|
|
|
|
|
|
2020-21 Joining Options |
June 11, 2020 |
25,000 |
Five years from date of
vesting of stock options |
30% of |
30% of |
40% of |
|
|
2020-21 Joining Options |
January 27, 2021 |
50,000 |
|
options granted |
options granted |
options granted |
- |
|
2021-22 |
April 19,2021 |
5,001,600 |
|
|
|
|
|
|
2021-22 |
July 20,2021 |
5,500 |
|
|
|
|
|
|
Joining Options |
|
|
|
|
|
|
|
|
2021-22 |
October 19,2021 |
5,000 |
|
|
|
|
|
|
Joining Options |
|
|
|
|
|
|
|
|
2021-22 |
January 18, 2022 |
49,500 |
|
|
|
|
|
|
Joining Options |
|
|
|
|
|
|
|
|
2022-23 |
April 16, 2022 |
5,227,730 |
|
|
|
|
|
|
Note: The exercise price for all the options granted by the Board/BNRC
of the Company, after listing (as tabulated above), is the closing price on the recognised
stock exchange having higher trading volume, on the date immediately prior to the date of
meeting of the BNRC scheduled to consider granting options under the Company's
Employee Stock Option Scheme.
Exercise price of all the options outstanding for all years/quarter for
2017-18, 2018-19, 2018-19 Special Options and 2018-19 Joining Options, 2019-20, 2019-20
Joining Options, 2020-21, 2020-21 Joining Options (1), 2020-21 Joining Options (2),
2021-22, 2021-22 Joining Options (1), 2021-22 Joining Options (2), 2021-22 Joining Options
(3), 2022-23 schemes are Rs. 468.60, Rs. 388.40, Rs. 388.40, Rs. 351.65, Rs. 369.50, Rs.
383.10, Rs. 400.10, Rs. 396.95, Rs. 501.90,
Rs. 451.05, Rs. 626.25, Rs. 656.80, Rs. 615.65 and Rs. 541.00
respectively.
Particulars of options for the year ended March 31, 2023 are given
below:
Options granted |
5,227,730 |
Options forfeited/ lapsed |
199,690 |
Options vested |
6,858,285 |
Options exercised |
1,270,555 |
Total number of options in force |
23,942,115 |
Number of shares allotted pursuant to exercise of options* |
1,265,295 |
Extinguishment or modification of options |
Nil |
Amount realised by exercise of options (`) |
489,088,638 |
Note: For details on changes in the number of options due to actions
like grants, forfeitures, vesting exercise, lapsation during the year and resultant
options outstanding at the end of the year vis-?-vis start of the year, refer Notes to
accounts. * 5,260 options exercised in March, 2023 were allotted in April 2023.
The following key management persons and senior management personnel
(SMP), other than whole-time Director, were granted stock options of the Company up to a
maximum of 147,400 options to an individual, aggregating to 710,900 options during FY2023.
Sr. No. Name |
Designation |
1 Mr. Judhajit Das |
Chief-Human Resources |
2 Mr. Satyan Jambunathan |
Chief Financial Officer |
3 Mr. Amit Palta |
Chief Distribution Officer |
4 Mr. Deepak Kinger |
Chief Risk & Compliance Officer |
5 Mr. Manish Kumar |
Chief Investments Officer |
6 Ms. Sonali Chandak |
Company Secretary |
Note: Mr. Souvik Jash, Appointed Actuary of the Company was granted
109,200 options of the Company during the year ended March 31, 2023 pending IRDAI
approval. These options are not included in the aggregate options specified above since
they have not yet been granted. No employee was granted options during any one year equal
to or exceeding 0.1% of the issued equity shares of the Company at the time of the grant.
Out of the total outstanding options at April 1, 2022, 6,858,285
options vested during the year ended March 31, 2023 and Rs. 489.0 million was realised by
exercise of options during the year ended March 31, 2023. During the year ended March 31,
2023 the Company has recognised a compensation cost of Rs. Nil (year ended March 31, 2022:
Rs. Nil) as the intrinsic value of the options. Had the Company followed fair value method
based on binomial tree model valuing its options compensation cost for the year ended
would have been higher by
Rs. 703.4 million (March 31, 2022: Rs. 587.4 million) and the proforma
profit after tax would have been Rs. 7,403.3 million (March 31, 2022: Rs. 6,954.0
million). On a proforma basis, the Company's basic and diluted earnings per share
would have been Rs. 5.15 for the year ended March 31, 2023 (March 31, 2022: Rs. 4.84) and
Rs. 5.14 for the year ended March 31, 2023 (March 31, 2022: Rs. 4.82) respectively.
Fair value methodology
The assumptions considered in the pricing model for the ESOPs granted
during the year are as below:
Particulars |
March |
March |
Basis |
|
31, 2022 |
31, 2023 |
|
Risk-free interest rate |
5.26% to 6.53% |
6.19% to 6.79% |
G-Sec yield at grant date for tenure equal to the expected
term of ESOPs |
Expected life of the options |
3.50 to 5.50 years |
3.50 to 5.50 years |
Simplified method (average of minimum and maximum life of
options) |
Dividend yield |
0.18% to 0.32% |
0.37% |
Based on recent dividend declared |
Expected volatility |
17.91% to 21.12% |
18.44% to 21.56% |
Based on historical volatility determined on the basis of
Nifty 50 |
The weighted average price of options exercised during the year ended
March 31, 2023 is Rs. 384.94 (year ended March 31, 2022: Rs. 381.95).
For the year ended March 31 2023, ICICI Bank Limited ("the Holding
Company") has not granted options to the employees of ICICI Prudential Life Insurance
Co. Ltd. (Previous year grant: Nil) and accordingly no cost was recognised.
Performance evaluation of Directors, Chairman, the Board and its
Committees
The Company, with the approval of its Board Nomination and Remuneration
Committee, has put in place a framework for evaluation of the Directors, Chairman, the
Board and its Committees.
The performance evaluation was undertaken through an online survey
portal. The performance of the Board was assessed on parameters relating to roles,
responsibilities and obligations of the Board and functioning of the Committees including
assessing the quality, quantity and timeliness of flow of information between the Company
management and the Board that is necessary for the Board to effectively and reasonably
perform their duties. The evaluation criteria for the Directors was based on their
participation, contribution and offering guidance to and understanding of the areas which
were relevant to them in their capacity as members of the Board. The evaluation criteria
for the Chairman of the Board, besides the general criteria adopted for assessment of all
Directors, included leadership abilities, effective management of meetings and
preservation of interest of stakeholders. The evaluation criteria for the Committees were
based on effective discharge of its terms of reference and their contribution to the
functioning of the Board. The Board Nomination and Remuneration Committee evaluated the
performance of the Whole-time Director i.e. Managing Director & CEO. The details about
the evaluation of the Whole-time Director are further provided under the section titled
"Compensation policy and practices."
Directors and officers liability insurance policy
The Company has taken Directors and Officers Liability Insurance for
all its Directors and Officers.
General Body Meetings
The details of the last three Annual General Meetings (AGM) are as
given below:
Financial Year ended |
Day, Date |
Start time |
Venue |
Twentieth AGM |
Friday, August 7, 2020 |
3.30 p.m. |
Through Video Conference (VC)/ Other Audio Visual Means
(OAVM). Deemed venue- Registered Office of the Company |
Twenty-first AGM |
Friday, June 25, 2021 |
3.30 p.m. |
Through Video Conference (VC)/ Other Audio Visual Means
(OAVM). Deemed venue- Registered Office of the Company |
Twenty-two AGM |
Monday, June 27, 2022 |
3.00 p.m. |
Through Video Conference (VC)/ Other Audio Visual Means
(OAVM). Deemed venue- Registered Office of the Company |
The following special resolutions were passed by the members during the
last three Annual General Meetings:
Annual General Meeting held on August 7, 2020
Re-appointment of Mr. M. S. Ramachandran as an Independent
Director of the Company for a second term of five consecutive years commencing from June
29, 2021 till June 28, 2026.
Continuation of directorship of Mr. M. S. Ramachandran after
attaining the age of seventy five (75) years, as an Independent Director of the Company,
till June 28, 2026.
Annual General Meeting held on June 25, 2021
Re-appointmentofMr.DilipKarnikasanIndependent Director of the
Company for a second term of five consecutive years commencing from June 29, 2021 till
June 28, 2026.
Continuation of the directorship of Mr. Dilip Karnik after
attaining the age of seventy five (75) years, as an Independent Director of the Company,
till June 28, 2026.
Amendment to ICICI Prudential Life Insurance Company Limited -
Employees Stock Option Scheme (2005) (Scheme)
Annual General Meeting held on June 27, 2022
Re-appointment of Mr. R. K. Nair as an Independent Director of
the Company for a second term of five consecutive years commencing from July 25, 2022,
till July 24, 2027.
Re-appointment of Mr. Dileep Choksi as an Independent Director
of the Company for a second term commencing from January 19, 2023 till December 25, 2024.
Postal ballot
DuringFY2023,anordinaryresolutionwaspassedthrough postal ballot for
appointment of Mr. Benjamin Bulmer as a Non-Executive Director of the Company. The
resolution is deemed to have been passed on the last date specified for remote e-voting
i.e. October 5, 2022.
No special resolution was passed through postal ballot during FY2023.
Further, at present, no special resolution is proposed to be passed
through postal ballot.
Means of communication
It is the Company's belief that all stakeholders should have
access to complete information regarding its position to enable them to accurately assess
its future potential. The Company disseminates information on its operations and
initiatives on a regular basis. The Company's website (www.iciciprulife.com) serves
as an important information dissemination platform for all its stakeholders, allowing them
to access various details of the Company at their own convenience. It provides
comprehensive information about the Company including Company's products, financial
performance, Board of Directors and Board Committees, management/key personnel, customer
service related touch points, and other statutory/ public disclosures. The Company's
investor relations personnel respond to specific queries and play a proactive role in
disseminating information to both analysts and investors. All information which could have
a material bearing on the Company's share price is disclosed to the Stock Exchanges
as per applicable regulatory provisions. The information is also disclosed to the National
Stock Exchange of India Limited (NSE) and BSE Limited (BSE) from time to time in
compliance with Listing Regulations and other applicable laws. The financial and other
information and various compliances as required/prescribed under the Listing Regulations
are filed electronically with NSE and BSE through NSE Electronic Application Processing
(NEAP) System and through BSE Listing Centre and are also available on their respective
websites in addition to the Company's website. Additionally, information is also
disseminated to BSE/NSE where required, through email. The extract of the Company's
quarterly financial results are published in the Financial Express (Mumbai, Pune,
Ahmedabad, Delhi, Chandigarh, Lucknow, Kolkata, Bangalore, Chennai, Hyderabad and Kochi
editions) and Loksatta (Mumbai, Pune, Nagpur, Ahmednagar, Delhi, Aurangabad editions). The
financial results, official news releases, analyst call transcripts and presentations are
also available on the Company's website at www.iciciprulife.com.
General Shareholder Information
The Annual General Meeting (AGM') is proposed to be convened
through Video Conference (VC) or/and Other
AudioVisualMeans(OAVM),incompliancewithapplicable provisions of the Companies Act, 2013
read with General Circular No. 10/2022 dated December 28, 2022 read alongwith earlier
General Circular No. 02/2022 dated May 5, 2022, General Circular No. 20/2020 dated May 5,
2020, General Circular No. 14/2020, dated April 8, 2020, General Circular No. 17/2020
dated April 13, 2020, General Circular No. 02/2021 dated January 13, 2021 and General
Circular No. 21/2021 dated December 14, 2021 issued by the Ministry of Corporate Affairs
(MCA'). Considering the same, the deemed venue for 23rd AGM shall be
the registered office of the Company.
In view of the virtual AGM, the members are given the facility to
attend and participate in the AGM through Video Conference (VC)/ Other Audio Visual Means
(OAVM), by following the procedure mentioned in the Notice of the AGM.
General Body |
Day, Date & Time |
Meeting |
|
Twenty third AGM |
Friday, July 28, 2023 at 3:00 p.m. |
Financial Year: April 1, 2022 to March 31, 2023
Book Closure: July 14, 2023 to July 28, 2023 (both days inclusive)
Dividend payment date: Within 30 days of the AGM
Fit and Proper criteria for investors and continuous monitoring
requirement
The IRDAI guidelines for Listed Indian Insurance Companies prescribe
the following:
Self-certification of "fit and proper person" criteria
by a person holding/intending to acquire equity shares of 1% or more of paid-up equity
share capital
Prior permission of IRDAI for holding shares beyond 5% of the
paid-up equity share capital.
Further information on detailed procedure and format for
self-certification is hosted on the Company's website
(https://www.iciciprulife.com/about-us/shareholder-information/other.html)
Business Responsibility and Sustainability Report, Environmental,
Social and Governance (ESG) and Conservation of Energy and Technology absorption
Business Responsibility and Sustainability Report (BRSR) as stipulated
under Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations,
2015 read with SEBI Circular dated May 10, 2021 forms part of the Annual Report and has
been hosted on the website of the Company and can be viewed at
https://www.iciciprulife.com/about-us/shareholder-information/other.html.
The Company has an elaborate ESG Report that details the efforts of the
Company on sustainability and is also available on its website. The Company constantly
undertakes technology and digitalization initiatives and works with employees, partners
and customers to offer simple and robust technology solutions towards reducing the
Company's carbon footprint.
The Company has undertaken various initiatives for energy conservation
at its premises and has used information technology extensively in its operations, which
includes technological interventions in aspects pertaining to policy lifecycle, marketing
& lead generation, partner integration, analytics and assurance.
Digitisation
The Company has fully digitised its policy issuance and servicing
processes. More than 99% of all our policies issued are logged digitally. The Company has
also offered its customers the facility of opening e-insurance accounts, an electronic
repository of policies. This enables our customers to electronically store and administer
their policies.
To the extent permitted, the Company also communicates with its
customers via sms and emails to reduce the use of paper. The digital platform is extended
to employees, advisors and partners too. Due to these initiatives the Company's paper
usage has dropped drastically over the years. The above initiatives and digital processes
have not only provided speed and convenience to customers and distributors, but has also
had a positive impact on environment.
Maintenance of cost records
The maintenance of cost records, for the services rendered by the
Company, pursuant to Section 148(1) of the Companies Act, 2013 read with Rule 3 of the
Companies (Cost Records and Audit) Rules, 2014, is not required.
Details of application made or any proceeding pending under the
Insolvency and Bankruptcy Code, 2016 during the year alongwith their status as at the end
of the financial year.
The Company has not filed any application for settlement nor are any
such proceedings pending under the Insolvency and Bankruptcy Code, 2016, against the
Company, as at March 31, 2023.
Details of difference between amount of the valuation done at the time
of one time settlement and the valuation done while taking loan from the Banks or
Financial Institutions along with the reasons thereof.
The above is not applicable given that the Company has not filed any
application for settlement under the Insolvency and Bankruptcy Code, 2016 during the
financial year ended March 31, 2023.
Credit Rating during FY2023
Type of Instrument |
Name of the Rating Agency |
Rating assigned |
Unsecured, subordinated, listed, rated, redeemable, taxable,
non-cumulative, non-convertible debentures in the nature of Subordinated Debt'
aggregating to Rs. 12.00 billion |
ICRA Limited CRISIL Limited |
AAA(Stable) AAA(Stable) |
Foreign exchange earnings and outgo
Details of foreign exchange earnings and outgo required under section
134(3)(m) of the CA2013 read with rule 8(3) of the Companies (Accounts) Rules, 2014 are as
under:
Particulars |
FY2022 |
FY2023 |
Foreign exchange earnings and outgo |
|
|
- Earnings |
1.00 |
0.41 |
- Outgo |
0.17 |
0.95 |
Commodity price risk or foreign exchange risk and hedging activities
None of the above is applicable to the Company as the Company neither
undertake any commodities business nor has any exposure to foreign currencies that may
require implementing any hedging strategies.
Plant Locations
The Company has various branches across the country, however, there are
no plants as the Company is not a manufacturing entity.
Details of unclaimed suspense account as provided by our RTA i.e. KFin
Technologies Limited pursuant to Regulation 39 read with Part F of Schedule V of
Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015.
No shares were lying in the unclaimed suspense account as of March 31,
2023.
Events after Balance Sheet date
There have been no material changes and commitments, affecting the
financial position of the Company, which have occurred between the end of the financial
year of the Company to which the Balance Sheet relates and the date of this Report.
Disclosures
(a) There are no materially significant related party transactions that
may have potential conflict of interest with the overall business operations of the
Company.
(b) No penalties or strictures have been imposed on the Company by the
Stock Exchanges, the Securities & ExchangeBoardofIndia(SEBI),InsuranceRegulatory and
Development Authority of India (IRDAI) or any other statutory authority, for any
non-compliance on any matter, during the last three years.
(c) In terms of the Whistle Blower Policy of the Company, no employee
of the Company has been denied access to the Audit Committee of the Board.
Adoption of mandatory and non-mandatory requirements
The Company has complied with all mandatory requirements specified in
Regulations 17 to 27 and clauses (b) to (i) of sub regulation 2 of Regulation 46 and some
of the non-mandatory requirements pertaining to Corporate Governance stipulated under the
Listing Regulations. The Company has adopted non-mandatory requirement regarding the
reporting requirement of the internal auditor, which in the Company's instance,
reports directly to the Board Audit Committee.
Green Initiatives in Corporate Governance
In line with the Green Initiative', the Company has effected
electronic delivery of notice of Annual General Meeting and Annual Report to those Members
whose e-mail ids were registered with the respective Depository Participants and
downloaded from the depositories viz. National Securities Depository Limited/Central
Depository Services (India) Limited. The CA2013 and the underlying rules as well as
Regulation 36 of the Listing Regulations, permit the dissemination of financial statements
and annual report in electronic mode to the Members. The Directors are thankful to the
Members for actively participating in the Green Initiative and seek their continued
support for effectively implementing the Green Initiative cause.
In order to support the cause, we have been regularly requesting
Members to register/update their email ids with their Depository Participants so as to
enable the Company to send various communication through electronic mode. We believe and
endorse the Green Initiative' as it would not only rationalise the use of paper
but also ensure prompt communication, avoid loss in transit and have reference value of
the communication.
DETAILS PERTAINING TO SHAREHOLDING Listing of equity shares on Stock
Exchange
The Company has listed its equity shares on the following stock
exchanges:
Stock Exchange |
Code for ICICI Prudential Life Insurance Company Limited |
BSE Limited (BSE) (Equity) |
540133 |
Phiroze Jeejeebhoy Tower |
|
Dalal Street |
|
Mumbai 400 001 |
|
National Stock Exchange of India Limited (NSE) (Equity) |
ICICIPRULI |
Exchange Plaza' |
|
Bandra-Kurla Complex |
|
Bandra (East), Mumbai 400 051 |
|
The Company has paid the annual listing fees for the relevant periods
to BSE and NSE where its equity shares are listed.
Market price Information
The reported high and low closing prices and volume of equity shares of
the Company traded during fiscal 2023 on BSE and NSE are set out in the following table:
|
|
BSE |
|
|
NSE |
|
|
Month |
High (Rs. ) |
Low (Rs. ) |
Volume (million) |
High (`) |
Low (`) |
Volume (million) |
Total volume of BSE and NSE (million) |
April-2022 |
542.20 |
507.80 |
0.95 |
542.15 |
508.00 |
30.89 |
31.84 |
May-2022 |
530.30 |
488.90 |
1.34 |
530.40 |
488.85 |
30.21 |
31.54 |
June-2022 |
565.00 |
482.40 |
1.01 |
565.05 |
482.65 |
34.30 |
35.31 |
July-2022 |
553.85 |
499.80 |
1.21 |
553.60 |
500.25 |
21.79 |
23.00 |
August-2022 |
593.75 |
543.45 |
1.42 |
594.60 |
543.55 |
28.44 |
29.87 |
September-2022 |
593.80 |
525.25 |
1.14 |
594.05 |
525.95 |
19.77 |
20.90 |
October-2022 |
526.95 |
500.40 |
1.69 |
526.90 |
500.40 |
21.44 |
23.14 |
November-2022 |
519.65 |
452.25 |
0.98 |
520.25 |
452.10 |
49.58 |
50.55 |
December-2022 |
481.50 |
439.50 |
1.10 |
482.25 |
439.65 |
33.37 |
34.47 |
January-2023 |
487.15 |
451.95 |
0.98 |
487.35 |
452.40 |
40.94 |
41.92 |
February-2023 |
438.55 |
399.85 |
1.27 |
438.75 |
399.70 |
44.24 |
45.51 |
March-2023 |
435.60 |
383.90 |
1.00 |
435.70 |
384.05 |
46.24 |
47.24 |
FY2023 |
593.80 |
383.90 |
14.17 |
594.60 |
384.05 |
404.97 |
419.14 |
Share Transfer System
SEBI has mandated transfer of securities only in dematerialized form,
except for transmission and transposition of securities. The Share Transfer Systems of the
Company is managed by KFin Technologies Limited (formerly known as KFin Technologies
Private Limited), Registrar and Share Transfer Agent (RTA) of the Company. The address of
the RTA is as follows:
KFin Technologies Limited
Selenium Building, Tower-B, Plot No 31 & 32, Financial District,
Nanakramguda, Serilingampally, Hyderabad, Rangareddy, Telangana, India - 500 032.
Email ID: einward.ris@kfintech.com and shobha.anand@kfintech.com
Toll Free/ Phone Number: 1800 309 4001
WhatsApp Number: (91) 910 009 4099
KPRISM (Mobile Application): https://kprism.kfintech.com/
KFINTECH Corporate Website: https://www.kfintech.com
RTA website: https://ris.kfintech.com
Investor Support Centre (DIY Link): https://ris.kfintech.com/clientservices/isc
Debenture Trustees
Axis Trustee Services Limited
Registered Office: Axis House, Bombay Dyeing Mills Compound,
Pandhurang Budhkar Marg, Worli Mumbai - 400 025
Telephone Number: 022-6226 0054
Fax Number: 022-6226 0050
Email id: debenturetrustee@axistrustee.in
Website: www.axistrustee.in
Information on shareholding
Shareholding pattern of the Company as at March 31, 2023
Sr. No. Category/Name of the Shareholder |
Number of shares on March 31, 2023 |
% Total |
|
(in million) |
|
1 ICICI Bank Limited (Promoter) |
737.61 |
51.27% |
2 Prudential Corporation Holdings Limited (Promoter) |
317.51 |
22.07% |
3 Foreign Institutional Investors /Foreign Portfolio
Investors/Foreign Bodies/Non-resident individuals |
250.44 |
17.41% |
4 Domestic Mutual Funds |
66.06 |
4.59% |
5. Domestic Insurance Company |
11.05 |
0.77% |
6. Domestic Body corporates, Institutions, Trust & NBFC |
9.33 |
0.65% |
7. Domestic Banks |
2.42 |
0.17% |
8. Alternative Investment Fund |
0.14 |
0.01% |
9. Retail Investors & Others |
44.01 |
3.06% |
Total |
1438.57 |
100.00% |
Shareholders of the Company with more than 1% holding as at March 31,
2023 (other than promoters of the Company)
Sr. No. Category/Name of the Shareholder |
Number of shares (in million) |
% to total |
1 Compassvale Investments Pte. Ltd. |
28.72 |
2.00% |
2 SBI Arbitrage Opportunities Fund |
24.87 |
1.73% |
3 Camas Investments Pte. Ltd. |
22.19 |
1.54% |
Distribution of shareholding of the Company as at March 31, 2023
|
Distribution schedule at March
31, 2023 (Total) |
|
Sr. No Category |
No. of holders |
% of holders |
Number of shares |
% of equity |
1 1-5,000 |
388,047 |
99.64 |
32,945,882 |
2.29 |
2 5,001-10,000 |
471 |
0.12 |
3,434,777 |
0.24 |
3 10,001-20,000 |
258 |
0.07 |
3,660,320 |
0.25 |
4 20,001-30,000 |
109 |
0.03 |
2,709,410 |
0.19 |
5 30,001-40,000 |
85 |
0.02 |
2,967,776 |
0.21 |
6 40,001-50,000 |
50 |
0.01 |
2,252,787 |
0.16 |
7 50,001-100,000 |
100 |
0.03 |
7,259,435 |
0.50 |
8 100,001 and above |
310 |
0.08 |
1,383,341,009 |
96.16 |
TOTAL: |
389,430 |
100.00 |
1,438,571,396 |
100.00 |
The Company's equity shares are traded mainly in dematerialised
form. At March 31, 2023, 99.99% of paid-up equity share capital is held in dematerialised
form.
Increase in share capital
The paid-up capital of the Company increased by Rs. 12.65 million from
the previous financial year, consequent to allotment of shares resulting due to the
exercise of stock options granted under the Company's Employee Stock Option Scheme,
and the paid-up capital was Rs. 14.39 billion at March 31, 2023.
Details of equity shares held by the non-executive Directors of the
Company at March 31, 2023 is as set out in the table below:
Sr. No. Name of the Director |
Number of shares held |
1. Mr. Dileep Choksi |
241 |
2. Mr. Anup Bagchi |
8,500 |
Queries related to the operational and financial performance of the
Company may be addressed to:
Mr. Dhiren Salian
Investor Relations
Registered office:
ICICI Prudential Life Insurance Co. Ltd.
1089 Appasaheb Marathe Marg,
Prabhadevi, Mumbai 400025
Telephone: (91 22) 50391600
Fax: (91 22) 2422 4484
Email id: ir@iciciprulife.com
Address for Correspondence
Ms. Sonali Chandak
Company Secretary
ICICI Prudential Life Insurance Company Limited
1089, Appasaheb Marathe Marg,
Prabhadevi, Mumbai - 400025
Telephone: (91 22) 5039 1600
Fax: (91 22) 2422 4484
Email id: investor@iciciprulife.com or csiciprulife@
iciciprulife.com
COMPLIANCE CERTIFICATE OF THE AUDITORS
The Company has annexed to this Report (Annexure D), a certificate
obtained from the statutory auditors, B S R & Co. LLP, Chartered Accountants and
Walker Chandiok & Co LLP, Chartered Accountants, regarding compliance of conditions of
Corporate Governance as stipulated in the Listing Regulations.
CERTIFICATE FROM A PRACTICING COMPANY SECRETARY
The Board of Directors have confirmed that they have not been debarred
or disqualified from being appointed or continuing as Directors of companies by the
Securities and Exchange Board of India (SEBI), Ministry of Corporate Affairs or any such
statutory authority. Additionally, an independent certificate has been received from Mr.
Tushar Shridharani, a Practicing Company Secretary, confirming the aforesaid declaration
by the Directors of the Company.
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis report for FY2023 forms part of
this Annual Report.
DIRECTORS' RESPONSIBILITY STATEMENT
In accordance with the requirements of Section 134(3)(c) of the CA2013
and the Corporate Governance Guidelines, the Board of Directors confirm: 1. in the
preparation of the annual accounts, the applicable accounting standards had been followed
along with proper explanation relating to material departures; 2. that they have selected
such accounting policies and applied them consistently and made judgments and estimates
that are reasonable and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the financial year and of the profit and loss of the Company
for that period; 3. that they have taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of this
Act for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities; 4. that they have prepared the annual accounts
on a going concern basis; 5. that they have laid down internal financial controls to be
followed by the Company and that such internal financial controls are adequate and were
operating effectively; and 6. that they have devised proper systems to ensure compliance
with the provisions of all applicable laws and that such systems were adequate and
operating effectively.
ACKNOWLEDGEMENTS
The Company is grateful to the Insurance Regulatory & Development
Authority of India, Securities and Exchange Board of India, Reserve Bank of India and
Government of India for their continued co-operation, support and advice.
The Board of Directors and the Company would also like to take this
opportunity to express sincere thanks to our valued customers for their continued
patronage and the investors for reposing confidence in the Company.
The Directors express their gratitude for the valuable advice and
guidance received from time to time, from the auditors, the statutory authorities, Stock
Exchanges and Depositories. The Directors express their sincere appreciation to all
employees and distributors, who continue to display outstanding professionalism and
commitment, enabling the organisation to deliver and extend quality services. The
Directors also wish to express their gratitude to ICICI Bank Limited and Prudential
Corporation Holdings Limited for their continued trust and support.
|
For and on behalf of the Board |
May 17, 2023 |
M. S. RAMACHANDRAN |
Mumbai |
Chairman |
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DIN: 00943629 |