Q4 19/20

May 22, 2020

Ladies and gentlemen, good day, and welcome to the Badaj Singh of Q4 FY 'twenty Results Conference Call hosted by GM Financial Services. As a reminder, all participants' lines will be in listen only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Please note that this conference is being recorded. I now hand the conference over to Ms. Bani Bhatji from Vane Financial. Thank you, and have a good day, ma'am. Thank you. Good morning, everybody, and welcome to Bajaj Fintel's earnings call to discuss the fourth quarter and full year FY twenty results. To discuss the same, we have on the call mister Srinivasan, CFO, Bajaj Platars. Mister Kapun Singh, CEO, Bajaj Allianz General Insurance. Mister Ramandeep Singh, c CFO of Bajaj Allianz General Insurance. Mister Karun Shwut, CEO, Bajaj Allianz Life Insurance. And mister Bharat Kalsi, CFO, Bajaj Alliance Life Insurance. Your request, mister Nirasim to take us to the financial highlights, post which we can open the floor for q and a session. Over to you, sir. Thank you, Barney. Good morning, everybody. In these difficult times, I would like to welcome everyone to our next edition of our conference call where we'll be discussing the results of the last Windsor Limited for q four and FY 02/1920. We Bharat Kalki is joining us for the first time as CFO of the Gavilion Life. In this call, we will largely be concentrating on the consolidated results as well as the results of our insurance operations through the Gavilion German insurance and the Gavilion Life Insurance companies. Ghazaland Finance, which is another major subsidiary of ours, has already had its conference call. However, if there are any high level questions, we would be glad to take that as well. We will not be taking any questions on the status of Allianz's stake in our insurance companies. The status has remained the same as at the end of the previous quarter, and there is no change. Any statements that may look like forward looking statements are just estimates and do not constitute an assurance or indication of any future performance results. A few remarks on Ind As required by regulation, BFS has adopted Indian accounting standards from FY 2019. Internal companies, however, are not covered under Ind AS. They have prepared Ind AS financials only for the purpose of consolidation. Accordingly, for bank and balance, the stand alone numbers reported below are based on the non India's accounting standards or Indian GAAP, as we may call, are GAAP legitimate to the insurance companies. These are in compliance with the IIBS financial statement regulations. Now to give you an update on the performance, even without the terrible effects of COVID-nineteen pandemic, India's GDP growth had shown clear signs of slowing down. Despite COVID-nineteen impact, RBI has been the significant measures of repo rate reduction. And even today, they have just reduced the repo rate to 4%. The CRR has also been reduced and targeted long term repo operations, TLTRO, was offered in March 2020. And MBSE, the non pay RBI, impacted the performance for the month of March 2020. The lockdown has since continued. It was first extended up to May 3. And now, at least in Maharashtra and many parts of the country, it will continue to still continue in different forms. As new car payments came to a standstill and since IRDA has provided customers time till fifteenth May twenty twenty to pay the renewal premiums upon fees expiring after twenty fourth March twenty twenty, the growth of general insurance industry was affected in March and the frequency lately as well. The life insurance industry also recorded a steep fall in new business in the month of March as a substantial amount of business seasonally for the life industry is returned in the last few days of March. Despite these challenges, the company has been able to record its highest ever annual consolidated total income and profit after tax. Before I cover the highlights for this quarter, I would like to discuss about Badakhtin's response to COVID-nineteen from the Q4 and FY twenty twenty results and the probable future impact for our insurance subsidiaries. As I mentioned earlier, Badakh Finance has already had its call and we have had an extensive review of the management on the various actions they have been taking from their side. Faced with COVID-nineteen and the lockdown, the company and its subsidiaries took immediate steps to handle this post mature situation. Some of the initiatives were activating business continuity plans, ensuring employee safety, operating work from home, setting up virtual private networks and IT infrastructure, continuing business digitally and reaching out to customers to meet their servicing requirements. In fact, Gagit, Dialect and VFL business continuity plans were tested by the lockdown, and I must say that all three companies came out very well, bringing in changes as required at a rapid pace. Every employee was contacted to ensure future health, safety and well-being during these tough times. A health support hotline was created for employees with a doctor on call. In addition, various end to end digital sales trainings were provided virtually even before the lockdown through our e modules and video based learning solutions such as SkinCity for badging. While ensuring the safety and up skill of our employees, we have made sure we support our customers and partners in every possible way. We continuously engaged with partners and provided virtual product training. We have mapped each of our distribution partners' capabilities and supported the partners who needed extra support. We integrated new processes and priorities to ensure smooth transition. At the customer end, we already had the digital assets in place to digitally service their needs. We reached out to customers to reduce their panic and engage with them to help them understand how to meet their servicing needs. To give you a bit more flavor on to this, Dyadic issued over 1,400,000 policies, settled over 700,000 claims and serviced over 270,000 customer footprints between twenty four March twenty twenty and thirty April twenty twenty when there was a complete lockdown. PagSegis onboarded 10,000 plus agents digitally through the Tarte app and even launched two innovative products in this period, pay as you consume motor products and Dagit Gopi CoPay Health Care. Dagit issued approximately 24,000 policies between twenty one March twenty twenty and thirty April twenty twenty. Of the 24,000 policies, around 15,000 policies were issued in April 2020, with term policies contributing to 21% of the total policies. In addition, Dalit digitally onboarded around 8,000 points of sales personnel through the iRepruit app from first April twenty twenty till twentieth May twenty twenty, with about 2,500 of them being onboarded in April 2020. The situation is still evolving and difficult to hazard a guess on how this pandemic will evolve. The company and its subsidiaries will be focusing on profitability over growth, seeking to convert cash conserve cash, borrowing long term, strengthening collections, reducing overheads and preserving capital management. The spread of COVID-nineteen pandemic resulted in a pattern and steep fall in the value of shares traded in the stock exchanges. In Q4 FY twenty twenty, the MIDTY-fifty index and the BSP-two 100 index both lost 29%. Under India, the insurance subsidiaries are chosen to hold equity securities at fair value through corporate loans account, and therefore, the insurance companies had an unrealized mark to market pretax loss of INR $7.68 crores in the consolidated financials. Additionally, BFL has made a contingency pretax provision of INR 900 crores in the form of company's interest in those subsidiaries has impacted consolidated As this pan out, it may turn out a bit different from what I'm telling you now. However, these are the broad trends that we are observing, and I would like to share with you some insights. Given the uncertainty, it's tough to gauge the extent of the impact COVID will have on the industry. This is what we think will it will be. The outlook for our general insurance business in the coming year is likely to be mixed. Sales of new motor vehicles and investment in assets, which are key drivers of general insurance are likely to be subdued. Motor insurance, travel insurance and credit insurance are likely to be impacted in terms of growth. Demand for health insurance will pick up as the need for protection is heightened. Property business is expected to benefit from the price Both the PSU buy mergers, I must complement the PagSeg team for this. PagSeg has retained all the large bank insurance relationships and gained access to over 10,000 Bryte branches to the already large distribution network. On the planes front, we expect the motor planes will be on the normal side while the restrictions are in place. However, post the lockdown, we expect some impact will be felt due to diesel cars, line are used, higher repair costs with dealers increasing rates. On health claims, as of now, we are not expecting COVID related health claims to be exceptionally high in relation to baggage size given the low level of penetration of health insurance and baggage own market share, which is below its overall market share. As you may recall, we had deliberately slowed down our exposure to group health over the last twelve months. So our overall exposure to this is actually lower than what it was maybe more than a year ago. This will evolve over the next few months. Stable management team and strong brand positions us quite strongly among the peers and should help us withstand the crisis and take advantage of opportunities once the crisis has passed. Coming to Bionic, during the period of national and state lockdowns, where businesses are not functioning, coupled with volatile capital markets, retail customers are cautious, right, and they are seeking to conserve cash. They don't seem to be comfortable making long term commitments. This will initially have an impact on new business subject to containment of the pandemic. In addition, retail sales, though doing well, could have done more, but for the compulsory medicals for our flagship new product, SmartProtect Gold. We have been conservative in our approach to underwriting in the SmartProtect Gold because it is, by far, the most competitive in the market. We will soon be launching a large SDG product with a higher nonmedical level, more number of locations than smart underwriting using any. There has been an increase in demand for guaranteed savings and protection products, and it is hoped that this demand will continue even after the pandemic. Vale's move towards the balanced product mix we started a couple of years ago is expected to help it stand in good stead. In fact, if you recall, we had been saying in the previous conference calls that one of the reasons we wanted to diversify product mix was to derisk our exposure to the market, which comes in the form of unit linked business. Dialog will be focusing on renewal premiums, analyzing new type of partnerships, controlling costs, reaching Consolidated total income, crores versus INR2995 crores. Consolidated profit after tax, INR194 crores versus INR839 crores. However, if we exclude the COVID-nineteen impact, which I mentioned earlier, the consolidated profit after tax would have been INR 1,001 crores as representing INR 139 crores last year. This is a reasonable growth. So that's finance consolidated profit after tax for the quarter, INR $9.48 crores versus INR $11.76 crores. This is after absorbing the special contingency provision for INR 900 crores for COVID that made special activated provision in respect of two large accounts of INR390 crores and further strengthened the expected credit loss provisions, which is required under Inveyor. As you are aware, India's rules do not apply to banks, but they apply to MBSE. Then let's turn profit after tax, INR $3.00 4 crores was INR 83 crores, which is more than 3.5 times after tax INR50 crores versus INR50 crores. Regards Finance Limited, total income increased by 36%. And after concluding the pendulency provision of COVID, the PAT was INR948 crores. Excluding the pendulency provision, the profit would have increased by 38%. India at thirty one March twenty twenty was INR14713 crores Therefore, BSL is very well capitalized to meet the contingency as we move forward to the next year. Paget had an exceptionally good quarter. Gross premium to the INR2655 crores versus INR3402 crores. FY 'twenty was INR24.14 crores versus INR25.51 crores. The combined ratio improved to 93.8% in Q4 FY 'twenty versus INR103.9 crores in Q4 FY 'nineteen. This is a remarkable achievement given the current circumstances. Genderwriting's profit, which is a very rare term in the development of the company in India, was INR159 crores Profit after tax for Q4 FY 'twenty increased significantly to 344 as I mentioned earlier. Solvency ratio was very strong, 254% as against 150% acquiring originations. And the AUM represented by cash and investments stood at INR 18,746 crores versus INR 17,237 crores as of thirty one thousand and seven in Q3 of 'nineteen. Amidst balance, after recording almost 25% individual The provision for impairment for FY 'twenty was INR390 crores of INR39 crores, INR35 crores impacted the shareholders' profit after tax. As in the case of Dagib, we believe much of the impairment is behind us as we look forward to the coming years. New business value, which is what we disclosed once a year and which measures the true profitability of Life Insurance business increased by 47 to INR227 crores versus INR154 crores in FY2019. And as mentioned here, this new business value is after absorbing all the overruns. The new business margin on A and P for FY2020 after covering expense overruns was 9.9% as against 6.9% in FY2019. Are progress company. Of made Badges has reported a minus 10% between the gross profit as compared to minus 9.7% for the industry if you exclude the crop and government business. The core business is in line with the math. Strong growth was recorded in property, laboratory, engineering, marine and retail health lines, while motor, travel, as expected, was a negative currency. Group health features were flat due to high loss issues. Agency, 54% share was the main contributor in the business for individual rate of growth business, as bank cost was affected due to the bank's focus on their core operations and because a number of the bank branches were not operational. However, we are slowly witnessing momentum in Bank HRM business in the month of May. Total calls issued by Dialog in April increased by 4% as compared to a de growth of 51% for private sales. Finally, the mix for Vale has a high proportion nonpart business, 36%, versus 15% in April. With these comments, I now open the floor for question and answers. Thank you. Thank you very much. We will now begin the question and answer session. The first question is from the line of Andres Sanghai from VT Capital. Please go ahead. Yeah. Hello, sir. Thank you for taking my question. So sir, have two questions on the life insurance part of the business. My first question would be if you could explain the EV walkthrough that you have given as to why there is so much of negative operating variance and operating assumption changes even though we have seen increased persistency across the cohorts? And my second question on life insurance business would be that recently, we have come up there there have been some articles which are saying that reinsurer and tightening the rules as to people who have been exposed to COVID or maybe are going to travel abroad, they won't be given life insurance contracts immediately. So any comment around that? Is there negative impact that you see due to that? Before I hand it over to Bharat to take you on the Internet value, and the second question would be handled by Bharat and Arun. I think as of now, nobody is traveling abroad. So I think that I can comment that we have reported to the press, I don't think there's really that important at this stage. Bharat, would you like to take the EV walk? Yeah. Thank you, Kenny. Thanks for the question. So if you look at the overall investment, is two, three sub sections to that. Though there is a number of INR 515 crores, but there are three sub section to that. One of there is a one off cases in this year. So we have provided some as we as it is mentioned in the deck also, we have tightened our impairment on few of our corporate bonds. So that is one number which is coming in as one more like a one off of around 122 crore rupees. That is one number. The second is the bigger so there's obviously a a some bit of an impact of equities market, which is given the volatility, the equity mark to market gain, but we have some gains from coming from the debt portfolio given yield has come down. So those are also sitting in the investment business. But the biggest thing which is happening in this case is that the because of the yield curve movement, if you look at our own forward yield curve, now the yield has come down from, say, a one year yield curve come down from 6.5 to 5.5%. When you look at a a one year forward risk risk curve, that has given us a almost an impact of 02/1965. But I this is, like, a timing as of now because the new curve is there, and hence, it is what we have to account for. If tomorrow, the new curve comes back to a label of earlier, then this will reverse. So these are all variance which we'll see consistently across everywhere during the market volatility and the neutral movements. So those are the three broader variance. On the second point, if I might come in, see, there is for us, term is in this new segment that we've got into in this financially as we did. Do we did kind of read our feed a little bit in the last quarter, but we did launch only term on the in the last quarter last year. So for us, anything is an upside, and that that's the good part. Yes. The reinsurers have gotten very of people who are travelers abroad or NRIs in the segment as well. For us, that is a very small segment, the NRI segment anyways today. And what we've done as a precaution that the reinsurers also asked us to do is basically get a COVID questionnaire filled if there is an existing exposure to COVID. So we are covering ourselves at least on that part of the cover. Does that answer your question? It is some clarification in the EV walkthrough part. So I wanted to know why there's some that kind of operating variance in negative. I got the investment good part, but I did not understand the operating negative variance. So I'll cover that also. Again, there are, I would say, three subsection to the number which you have shown is a 94 crore. The first section is as part of our usual exercise, we always update our best estimate experience on both on the mortality and the persistency and of the mortality, morbidity and all. So this time also, we have updated to based on our actual experience. So within that, we have got some benefit in terms of our mortality experience, which is around a 31 rupees. And then we have also updated our last assumptions, which is a negative of around 13 crore. These are small number changes which happens in the usual as a year end exercise, and that has given us a positive of around 18 crore in terms of mortality and persistency. But, what has happened is that within our MFI business, we have an extra clean on the group side of the business, and that is what really has impacted this operational variance of around 113 crores and the net impact of 94 crores. Alright, sir. So just one final question on the general insurance part. So you all mentioned that you all see you all forecast some kind of growth coming from the health business. So apart from health business, is there any other area where you might want to venture into and you might see some green shoots coming in the coming year due to have it changes? Okay. It's an interesting question, but let's look at April data to understand. So and this is actually a funny part of our business. If you look in April, the industry, the GI industry has a negative growth in Retail Health. We have a 9% to 10% growth, that's the story. So though a lot of queries getting raised, if I look at sales and I felt April, that's why was very keen to look at the sales for April, I think it should really be going up to the roof, which will not happen. But obviously, queries are happening. People are raising concern about how this is going to move and how this is moving up. So there would be an uptick in health, but to think that an uptick in health for industry would be really huge, I don't think that would be happening. But that is our personal prediction looking at how April has moved. Having said that, again, we are trying to create awareness because if you look at the Indian market, health insurance still has COVID covered. And you just spoke about the live question where international market is very, very, very. I was actually telling my people that why are the servers not cashing because people should be buying health insurance. But unfortunately, I don't see that happening as far as the trend is concerned. There is an uptick, there is a movement, but not to a huge extent, right? It may move up. If it moves up, we are fine because we have a presence all across the different channels and geographies, And that is effective in month of April also, if you look at the industry, it's minus 3% retail growth and we are plus 9%. So if it happens, we'll obviously be benefiting from that. That is one point. The second point, if you look at the growth in business, property like Srini mentioned, because of some rate correction in some segment, it has some positive upside there. Motor has had a sharp decline at nearly half of what it normally would be given. But going forward, looking at the Chinese experience of Wuhan, we expect the at least smaller segment and two wheelers to start moving up in terms of sales. So that would come in later during the year because I think whatever segment has been, maybe people start resuming the normal lifestyle, so those things will start happening. The other if you personally ask me what should go up, but let's see if it does or not, the cyber insurance should go up because that's a huge risk. You see cyber types have moved by about 1000% to 1000% more across, if you look at statistics happening, That should go up. That's up to you. The liability should go up. We look at liability cases in U. Which is happening because of COVID and the way directors and officers are reacting to it is also moving up. That should move up. But these are assumptions that we feel should move up, but let's see how the market reacts and how does it behave. I hope I'm able to answer your question. Yes, sir. Definitely. Thank you for that, and all the best for the future. Thank you. Thank you. The next question is from the line of Sudesh Chien from Investec. Please go ahead. Hello, sir. Thanks for the opportunity. Firstly, on the Magic, if I look at the claims triangle, there is a small expense in in the earlier years, and there is a significant relief of regards in the in the near near years. And I think there's almost 500 crores of the reserve releases in this particular financial year. So how do you see this sharp increase, sharp relief in the in the near term years? Whether it's sustainable because that has an influence on our EBITDA profitability, and how do you see this 500 crores of reserve lease for this particular financial year profitability? See, let me take that before I hand it over to Ramayan. When I look at the overall reserve in terms of what it was last year and what it is now, we are actually better off. Even the year on year, if you see, we have 10%, 12%, and 8% surplus reserves as of now. And when you look at the past trends, this seems to indicate that we are in a fairly good situation there. Regarding the specific questions on the private quote, Raman, would you like to take it? So, Shini, nothing is specific which has changed this year. But if you like you rightly said, if you look at the trend every year, you know, there has been a release of five to 8%, and I presume that that is expected to continue. There's no reason why there should be a deviation. This is. Let me let me add to it. Is that as soon as the claim is reported, we have a very robust, what we call, auto reserving system. So we because we would not have any information, we immediately put in the auto reserve depending on the line of business and depending on the type of play. And then as the data evolve, the reserve is continuously updated. Now in any year, because we are a large company, we have a large number of claims settlement. A majority of almost all of this, the claims settlement, my understanding is that has come out because we have settled those claims, and whatever reserves are there, again, the claims is actually we have got. I think if you look at the question we asked, this is a natural behavior of GI industries. And the actuaries have specific tools. And wherever they see a trend in which they feel that, no, the reserving should be strengthened, they strengthen it. And like Siti mentioned, the claim gets settled, the reserve get released. So relief reserve is a good sign because that means that the company is adequately reserved. That happens every year, like Raman mentioned. This is not something that is unique. If you look at the past years also, you will see reserve release. And if you'll see that there would be spending happening, where the fees, it is low. A spending that you see is mostly because of there was a TP pool way back now much earlier, if you remember, it's the history now. And that TP pool had given an UULR, which is no ultimate loss ratio of the pool had given. And way back, that is where the companies had reserved themselves, but that UULR fell short. Prudent companies have strengthened that. Where they feel that, that is going short, they have strengthened the reserves because if they see the trend is not moving up, they have strengthened it. But overall, if you see that a reserve release happening for a company and as a triangle, it is a good sign. And if you look at Badriq, 7% to 8% is normally where the reserve release keeps on happening when it's a little trade. So that shows that we are adequately reserved, you know, over time. Does it answer your question? Yeah. Yeah. Yeah. So that is one more point here. If you look at, we have generated about 1,500 crores of net agent surplus, and that itself is an indicator for prices and all that. And that in itself is an indicator that our cash flow is significantly higher than our profit after tax. Yes. Coming to dialect, we have seen quite sharp growth in nonpart segment. And for month of April also, you are likely that 50% of business has come from nonpart. Given the declining interest rate environment and so probably the interest rate environment may remain subdued for us for some time. How do you see that non par strategy going forward, and how are you hedging these products? What are the level of guarantee that you are offering? Arun? Yeah. So, see, it's very good question, and it's something we are always keeping a very shock hawk eye on this. What we typically do in our approach is that before the year starts, we usually have our future business based on our plans for almost nine to ten months of business yet expected. So in terms of holding bonds, so we've been taking some calls pragmatically. So we've been doing a lot of partly paid bond hedging, and we've got a significant portfolio build on that. And these are fairly high high credit rating and strong groups that we've built. There is no letting off on credit risk on this portfolio. And we've basically, even if we, today, hypothetically, did not bring down our guarantees on the other side for the next eight to nine months and continue doing business, we are well under control. But having said that, we will be going ahead and taking a call on this dynamically, and we review it every quarter. So we will bring down for sure, but I won't be able to say when. But like I said, even if we did not bring it down for the rate next eight to nine months, we are absolutely comfortably hedged for a portfolio business we've not yet written. A little bit on nonpar is that although nonpar was 30%, there's also term business which is part of nonpar. And in terms of MOPs, that is really going up. It's been a there's a good amount of tailwinds on term plans, both offline and online. And I can see my agency business has also picked up quite well. So that is also the near the nonpart portfolio. Got it, sir. And can you just share the details of assumption change branch? What is this? I'll let that question be answered by Bharat, and then maybe I'll come back for any additional. These are the assumptions changes. Yeah. See, these are these are smaller impact of the since the second order impact in terms of the mortality in that which I shared earlier, it's a small number of twenty four crore, which has come both from the mortality in that. Because when you change it, all your future bits unwind and all this, it has to change. It's a smaller number as part of the. Nothing significant there other than the usual mortality lapse assumption per day. Okay. Thank you, sir. That's it from my side. Thank you. Thank you. The next question is from the line of Ashu Sharma from Imam Asset Management. Please go ahead. Yes. Hi. Thanks for the opportunity, sir. Just two questions. First one on the on the outlook for combined ratio. I think the Q4 trend was positive. I mean, even if I look at number of listed to the crop, any sense in terms of any outlook you can give on how we see combined ratios? And then I think secondly, on a similar thing that given that we'll see that investing needs would be under pressure, will it be paramount for industry to sort of focus on on underwriting profit? Second would be on on on on balance in terms of the outlook for V and D margin, sir. Okay. First, let's talk about the combined ratio. So if you look at Q4 looks good even without crop also, like it's about 97% combined ratio. The fundamental difference is if you look at times when we have floods and times we didn't have floods. So if you take out the flood impact, our combined ratio would be, we're making good underwriting profit. So in Q4, we didn't have any major flood even. That is how this moves in the kind of business that we are. Last call also, I mentioned that I see it improving as time progresses. Now if you look for this year, obviously, I can't make any forward looking statement, but if I look at the current trend, because of lockdown, two things have happened. Hospital occupancy is about 30%. Now this has two meanings. Either hospitals were pleasing to the tune of 70% or people are holding back their treatment. No? Now if you're holding back the treatment, let's be more worried because if they come back, then the claim size will actually move up. No? Because if you're treated early, it is still easier to treat and the cost is lower. So one of the feeling can be that if I look at the claims for health as lockdown eases out or people know they are not able to postpone their surgeries or treatment, that may start moving up. So that has to be seen along with the impact of how COVID starts moving up. Right now, COVID is not more up to an extent that we find it alarming or significant, but looking at trend, you never know how it moves up. So that can have an impact on the combined ratio going forward. The second, if I look at motor business, so in the lockdown period, yes, the motor OD and the motor TP would be lower. But as it's opening up, the pent up, previous losses will start coming in and people start using more private vehicles and commercial vehicles start putting in more hours on the road because they have to catch up for the lost time, that will lead to high increase in frequency going forward. So there would be some benefit in loss ratios where lockdown is on. There would be a spike more than a normal when lockdown is off. So the play of these two will decide how the combined ratio comes out as the year progresses. Would be there. Does it answer your question? Yes, sir. At this time, on trying to balance the the declining investment yield, so will it be now even more important for for players in the industry to focus on underwriting profit? Can you give some perspective If on you look at Badik, we have always been an underwriting company. Have a lot of times mentioned this. And in fact, if you go back to maybe a couple of years, you'll hear one of my statements saying that in the European market in the past also companies did not focus on writing when sharp fall happened in investment returns, so those companies had a tough time. So in the Indian market also, this would happen now. As you see in the rightly, I'll be pointing out But company like us who have been focusing on writing over years and the disciplined culture is there, I think for us, it will not be such a huge issue because I think investment income has always been on top of what we try to achieve on business results. If I can just add to what Patan said, as I said earlier, our objective has always been profit over growth when times are tough. Across all our businesses, our strategy is worth checking. Historically, it has shown over the last twenty years that we have always been an underwriting focused company. In the market, different players have different objectives. There are small players who are still trying to get to scale. They will be hungry for capital. Availability of capital will rise how much they want to gain market share. In terms of larger companies, which are using cash flow underwriting, The PSUs are very good examples of that, but there are some private companies as well. They would have a foreign investment income. There's no equity gains to be taken possibly for some time. The conference is now being recorded. Whichever banks in the private sector were up for tie ups, We got all of them. So the channel mix is shifting. The third channel is the online channel. We were in the unit space, we were the leaders because online, I believe, unit, if it can be a low cost, it's really an online that you need to get or sell it, and that has gone quite well. We are now now that we have a presence in the online space, we are now moving that space into the firm business. That is helping in a significant fashion. The focus will also be on the four the fourth pillar, which is on cost. We control our cost because what we see ahead is not necessarily clear clarity. There is no clarity on what is gonna happen going forward. So we did make a statement that people would rather keep cash in their pockets than commit to a very long term product as of now. So we have to see how it goes. We had an encouraging April versus the rest of the sector, but I'd say it's only versus the rest of the sector. It's surely there's a lot to be seen, and the year is just about started. So the longest answer to a short question, but it is more important to understand the that the company is now just looking at new business premium and new business margins as any other company is, and we are strongly in that part. That's helpful. You. All the best. Thank you. Thank you. The next question is from the line of Anivant Sikhar from Principal Asset Management. Please go ahead. I'm using a line using documents. Please go ahead. Yes, sir. Yeah. Hi. Thanks for the opportunity, sir. I have two questions. One for your general insurance business and other for the life insurance. For the general insurance, if you could throw some light on what the impact of the change in motor TT liability calculation is on the business overall, that would be great. And for the life insurance, I'm sorry that I've already mentioned this, but what is the persistency assumption for your VMD calculation? So those are my two questions. Yes, sir. Before that, I just said, are you referring to the new some kind of draft which you say is that the way the obligation would be Yes. Yes. Yes, sir. That one. Draft, and we are still not going go ahead. Yes. Think more than that, the question should be that if you see this year, there's been no increase in TP rates. I think that has a direct impact on the business. So if you look at it, normally, you get a 7% to 8% increase, and this year, the increase is not happening in And that is why the previous question on combined issue has been discussed. So you would have those inflations happening, but again, because of the lockdown and less use of against those months, I think that is where the playoff will happen. So that has a more impact. I think on the draft, you'll see how it comes through. It's too early to know. Comment on that. Got it, Karan. Yeah. Go ahead. Yeah. That was a suggestion. Any other question you have? Yeah. The other question sorry. This is a there is a follow-up to this. So do you disclose the breakup of your, you know, motor premium type vehicle, like car, TV, and two wheeler? Is it information available anywhere? No. I I don't think so. It's overall level, but then it is too much into getting the business details of, you how do we run into business. But if you look at GI disclosures and the information available, it is exceptionally good, Bala, from our IDS side or the council side. I think a lot of information gets available. Sure. Sure, sir. Thank you. And my other question was on the life insurance business. What's your persistency assumption for the BMD? Yeah. So, see, the persistency assumption actually varies with the product. So they're not one standard persistency product assumptions. We are talking about a pretty varied segment of products, and it's really part of the actual calculation, something we don't really declare. If you're asking me, is the question really is that are we feeling confident that we meet our assumptions? Yes. We are. And we actively look at assumptions towards the to to to to towards in the assumption with the with the market process. Have you changed these assumptions in the latest number? Last year, Bharat? So so we typically every year, we revisit this is our similar experience, revisit our all our our assumptions, processing the assumptions. And we had this time gone as Arun rightly said, we have gone quickly in more detail in terms of going to the product level assumption as well as the the channel level persistency assumption across the cohort. So all that has been considered, at least for the March numbers. And going forward into that of now on the same basis, but going forward as we declare our results, we'll update this as our recent experience. Got it. Got it. Thank you. Thank you, sir. Thank you. The next question is from the line of Ditesh Kalati from Haitong Securities. Please go ahead. Yes, sir. Thank you for giving me an opportunity, and congratulations on a very good set of numbers. Sir, a couple of questions from my side is what will be the advanced premium numbers in the general insurance business? And, sir, also, the ratio of NEP to NWP looks very close to one this time, sir. Any specific reason for that? And I have one more question after few answers on the life insurance, please. Sir. Can you repeat the question, please? Sir, the advanced premium number for the general insurance business? Ma'am, do you have the number? Yeah. I'm just giving, Sridhi. It's so there are two parts to it. One is on the motor. It's about 760 crores. Plus there are other lines of business also. That's another 260 crores. So in all about a little over thousand crores. Thank you, sir. And sir, the ratio of NEP to NWP looks close to one this time, sir. Any specific reason? Because the mix on the year on year hasn't changed. Just trying to understand that. In certain lines, we have grown, so there will be less. So the function of how the MEP moves depends on all the business mix in terms of the reinsurer business versus the retail business will move. So it's difficult to get an overall comment on the company's MEP to MEP. It's and the general insurance companies follow one by three sixty five. That's right. And the health insurance are falling fifty fifty. That's coming to me. Yes. Yes. Yes. Yes. Okay. Yes. And just one last question, sir. New business train on the life insurance piece. I just want to understand which are the segments which causes the highest train for us because protection is something we added only in q four this year, but we are doing a of unit and non power also. So just any qualitative comments on that. Correct? Bharat, you want to hear it? Sorry. I just need the question completely. Sorry? Where can you business saying that they're likely to come from this product line? So new business, actually, I the we are not different than typically the business unit come from the unit line business as well as the nonpart business. Within nonpart, sometimes, as Tarun mentioned, that we are pushing towards the protection business. And within the protection, there are few variants. If you're on unlimited, then it can have some change in terms of initial years. But if it is a regular day, it will not be there. So it is more like a balancing of something between non par and you are only. Par is generally not a, you didn't say, like a business. Thank you, sir. That's it from my side. Thank you. The next question is from the line of Ehjal Gana from Finvest Advisors. Please go ahead. Yeah. Hello. Yeah. This time, you know, we don't find the breakup of life insurance business according to the channels. Can you provide that, sir? Hello? Yeah. The breakup breakup of the new business premium, $5,001.79 crore in f y twenty, according to the channels, that breakup is not there. I think they're given in our mix, the overall channel mix. Right? No. It's not given. I think there is no slide in your presentation that how much has come from the banker, how much from individual agents, corporate agent, direct selling, brokers, online. I think this is the classification which you used to give in last year. Right. So let me give the general wise. Let me just check. It's, like, somebody else. So I'll I'll I can give you that. I can give you number of what you There's no point looking at the new business premium based on channel mix. It's better to look at the individual rated new business premium. Yeah. Yeah. So which is around 56% was agency last year. Mhmm. The Which is last year was of f I twenty? F I twenty. Ah, agency was 56. This is down from 70% the year prior. Okay. The online business was around 11%, which is up from 9%. Okay. The institutional business is basically bank assurance brokers Yeah. Was up from 11 to 21%. 11 to 20%. Okay. And the proprietary sales was static at 11%. The year prior, it was 10%. Fine. Now another question is, at the group level, is there any thinking of converting the finance improvement? No. This is something we keep deliberating. As of now, we have no specific plans to do. No. No, sir. Plan. Okay. Okay. Thank you very much, sir. Thank you. The next person is from the line is from. Please go ahead. It is Rohit Shah, not Rohit Shah. Two questions. Essentially, if you look at the core of any insurance business, it revolves around three principal ideas, underwriting skills and the profits, investment management and the returns, And the third aspect will be the growth. So my first question, if I have to take a combination of underwriting profits and investment, returns. On underwriting, we have done fantastic job all through, with our consistently has been, well ahead of the industry curve. We have remained very prudent. And, just to change what we have not sacrificed the quality of underwriting that we have done. So full marks there. But I do have concern about investment of both in basic and. There are consistently poor quality investments which are made. And quarter after quarter, year after year, some write offs of the others keep happening and diluting the overall quality of the returns, both for the unit holders as well as for the shareholders. It I can't help feeling, but investment management, which should be core of any insurance activity apart from, of course, the underwriting and growth, which I'll take up later. But investment management function seems to be kind of a secondary or less paid attention to kind of a function. That is the impression I take. I would welcome comments. Okay. I will take that question. If you know, Bharat, This year, we had already announced in the first quarter the additional impairment potentially from DHFL. And then in the S Bank also, we have investment. However, SBIang, after SBI took over, SBI decided to cancel the 81 blocks, right? We are still going to honor the remaining part of the NCDs and other things is working in management of stores. Which means that the companies are not defaulting. We are continuing to pay interest, but based on our assessment of the impact of COVID and potential cash flows, we are making. Consequently, we have completely revamped our investment portfolio, our investment strategy between Bajat and Allianz and the companies we have started together, we have retracted the entire approach to investments, particularly on the credit side. Because when you manage investments, it is very easy to say that I money in the company. We have company. Of of company. Have But in the process, we have a completely reran the whole company. Thing. We now go in with the defined names, which I think I mentioned in the last quarter as well. We have a specific list of approved credits, which we'll go through. We have strengthened our credit team. We do not use only credit ratings now. We also use our internal models. We have also across the group a set investment forum where we have, depending on the listing, either a weekly or a fortnightly call, where we look at all common investments across the group as well and then take a call on what is to be done. With the credit of the team, after this event happened, they have also got rid of quite a few investments at reasonably good prices, but before some of them became more invest. So we should get credit to the team that there are a couple of investments we actually got out of in the year of reasonably good amounts. So the residual balance now is not there. The team has been strengthened. The policies have been strengthened, and we'll be going forward. As you mentioned, in general insurance, investment cannot be a driver of the profit. It is the float generation that is important. On the float, you have to invest it conservatively because on the insurance side, our balance sheet is full of risks. It will come to us because they are risks. But if you want to take investment risk and underwriting risk, then the two may not, in some years, would do pretty bad results. It could even affect your solvency. In the Life side, the power business is very long term. There are ninety-ten rules and there are IRDA guidelines as well where you have to invest a minimum amount. The amount of flexibility you have is not that much. In terms of unit linked, our performance is in line with both of the competition. We are among the top quartile performance almost all our funds and one of our funds pure stock funds, sometimes well with most mutual funds in the industry as well. The non par is a guaranteed product. We do not take any investment elsewhere either on the credit side or on the equity side. It is about managing the guarantees. And as Karim said earlier, we are fully protected for our expected business for at least one year. As we go forward, we look at more hedging options. IRDN's new product guidelines now allow us to also reset the interest rates when there is a big decline. So therefore, we have never been very aggressive in offering very high interest rates or taking high exposure on our product suites, which some companies have done in the last year. And as interest rates have fallen, we have appropriately adjusted our interest rates once already, and we'll be doing so again when the more things are required. So yes, if you ask me one year ago, your comment was valid. If you ask me today, I think we are a lot more confident companies about our ability to manage investment and take it forward. Given my sense, if you look at the return, it's been 10.9% for the year, which I would say would be comparable or better than most of our peers in the market. That should be there. So we will not not as much on the quantum of return in terms of the quality of return. If we keep getting drawn like a magnet to some of the big exposures, like, and and adjustment, the a four, the HSN, etcetera, then I think it is the predictability and sustainability which comes into the question. So while quantum of a return in a particular period may be good or bad, that may be a constant, accident, or a chance, but it is sustainability, solidity, predictability, and focus on investment management in a con a way because as Srini correctly pointed out, insurance itself is a risk activity. Therefore, the investment activity, which is to add to that, must counter that risk and should be able to create a predictable earnings. Otherwise, the whole, thesis of insurance business gets diluted. So I if I have to go by Shiny's comments, I assume investment function is now a core function and not one of the functions in the in the activity. Think I think that during the year, we now have a very strong internal committee on investments. They meet every month. And apart from the investment team, we also have other professionals, including the CEO and the CFO, who get involved in assessing the market, where the direction should be looking at the performance and what kind of calls need to be taken. We are obviously not we are looking at a very long term continuously managed program. So just because, for example, the equity market style, there's always a tendency now let us increase our equity exposure. Which I think is the biggest risk for an insurance company, especially a GI company. So having said that, yes, when you have an investment which is not performing, I think that is normal in any investment portfolio. How quickly you react and how you recognize the problem early and what action you take is very important. I must admit that last year, your question was very valid. We realized that we were not quick enough in reacting to some investments. But going forward, we are very confident that this will not occur. Thank you. The second part is on that growth issue. And the again, my comment here is definitely less on basic, but it is on basic. We we have been as I mentioned earlier, we have been very, very prudent in our underwriting risk, and that reflects very clearly your long period into, our combined ratio on the basic side. So full marks to, the firm for that. The growth issue equally is important, because the growth issue will be a function of the kind of a brand, kind of distribution network, and kind of innovation of a healthy variety, which will create the right kind of product suite. The basic side, growth is, only to be an issue, mainly led by our weakness on the banking distribution side. Some part of it we have addressed, but, do you think we have a likely healthy balance of underwriting, and growth in basic? We are, kind of reaching a healthy balance between underwriting performance as well as growth in Delhi case, sir? You're asking, Raju, about Valeant, whether we have the right mix of growth and profitability. Is that? No. My question is in Dalik, why our underwriting, I would assume, will have the same character and the prudence as we have displayed in basic side. In basic, both growth and underwriting have remained healthy. In basic, as far as growth is concerned, we have some legacy distribution weaknesses, especially on Tata side. Also, on the product innovation in terms of the products, Do you think going forward, we seem to we will have a hence between Saru, I got your question. I think the target, if you see, yes, between 2012 and 02/2015, we did go through a very poor performance because we lost the other bank accounts. It was predominantly 90% of our individual rated period was coming from our agency channel And the agency channel was and it was becoming a high cost channel to drive growth. So therefore, was getting affected. And we had overwhelmed and therefore we had negative margins. In last three years, I think there has been a significant transformation. We have transformed every quality of business. Our persistency, while it may not be among the top three, it's very close, within touching distance of the top three or four companies. In terms of margins, we are now at double digit margins after overruns. Pre overruns, we are between about 17%, 18% margin, which we think is sustainable. In terms of product innovation, the ROLC, variety of products, we have been at the forefront. What we have not done and what we can actually bust a life company is offering exclusive guarantees. We did see the market products which are offering 66.5% guaranteed return for twenty, twenty five years. But one year down the line, when I look at those kinds of products, I think those companies will have to review what they offer and what they offer in the future. Obviously, a small amount of business, which does not hurt your balance sheet much to maintain growth in share. So if you look at the last two years, our growth has been significantly better than the market. Even this year, if you look at April as well, the market is down 30%. We are still at 1% growth. So overall, I think the transformation of Dialog, which I've been talking about for the last three, four years is we have the confidence that it is firmly on track. There is work to be done. We will continue working on the same levers of business, both growth and profitability. Our focus is not on margins. Our profit is on new business value, which is a function of both growth and the margins that you get, and we will continue on that front. Arun? Probably it's very appropriately answered by Srini. If I look at the your your point is valid, Barat, and I really appreciate the way you look at things here. There is I can see there's a deep insight of insurance there. See, the point is the if you look at the large companies which you track, they're solely and wholly almost, if I might say so, except maybe neither side one, two, and there, largely led by bank assurance and the growth is particularly led led by that. Also, they're owned by banks and or if nothing, at least 70% of their business comes from any bank, one bank. You see the promoter bank. We, of course, do not have that legacy. You you can either take legacy as a problem or you can take it as a benefit. The way we've been taking it as more as a benefit. As we're building and you're right, we have almost rebuilding this business in the last three to four years, and it does take some time. It doesn't just get switched on, switched off. So therefore, we are being very careful that no one single distribution will, you know, kind of decide our fate. No one customer segment will decide our fate. No one product segment will decide our fate. So, therefore, we will be derisking from all aspects. That having said, last three years, we and you're right. We have structurally shifted our distribution significantly to get banks. So the focus has, of course, been more on private sector bank, public sector. There's been mergers, and we did have ties with Dana Bank and Syndicate Bank, which moved into the end to to to Bank of Baroda and Canberra Bank, respectively, and we lost those distribution. So we saw more certainty coming in from the private sector banks, and we've got access, RBL and KBB, like I said. And we do have a a smaller segment of banks, which we basically almost are building up, which are the four SSDs, and there is the India Post Payment Bank as well. So what this has helped us with is to struggle various segments of customers, various product segments, and not any one single bank. We we expect to hold more than a certain percentage of our business, which is therefore going to be derisked. Because you see a few, and I won't name any, see a few players in the market. If one bank's needed, the the their license or in some company plans up for catching cold. So we we are very clear about that as we are building it up. And you'll see more and more news around this because we are, very clearly focused on developing a more rounded business. The benefits of bank as its underlying undercurrent in your statement is that it is more variable than fixed cost because you're relying on a partner partner distributor, and you don't need to develop the entire distributor distribution yourself. What we are doing, therefore, is trying to, of course, get more banks. But at the same time, the if you dramatically look at the variable bit, we're also ensuring that the agency business, we're trying to make into a more low fixed cost, high variable. And that is something that we will keep focusing on as well. And that is where the benefits will come. This the growth story started off quite well last year until, like, February, we were double the growth rate of the sector. In March, also, we did not fall as much. April has been comfortable. It's a little difficult to talk of growth at this point for this coming year. But having said that, if the market sort of de grow, of course, my broad brush statement would be that we would we will be better placed. If the markets will grow, we'll be growing faster far faster than the rest of the sector. Will it be a very large growth for the for the for the GDP, for the industry this year? Unlikely. Very, very unlikely as you know. So therefore, cannot much talk about growth. What we are using is we are trying to only just getting we're just only focusing on getting other parts of our matrices right. We talked about Magic's good underwriting. I can tell you last four years, I've been spending Balik as well and trying to get good underwriting. We did not launch our term plan for the first two years because I was not confident of the underwriting. Last one year, it has been in beautiful. The way the the underwriting has been happening, and that has given us the confidence to get into the term market. And now we are plugged into that, and we are getting more and more share. I can tell you already in terms of number of policies, we are on the top five in terms of term business. So so that is a trend that is going forward. All your points are noted, and you can pretty well be sure that we are making it a more rounded ball than a ball with edges. Thank you so much. I'm delighted with both the answers, and I feel far more reassured as I've always been about the business of the. And I'm also I also appreciate your comment about some of the people rushing into the guaranteed products, but which came many of the actions will have cost and repercussions later and not at the time when the action is undertaken. Therefore, local needs to remain on the right side of that guaranteed kind of probable issue in a right way is something I deeply appreciate. Thank you for both the answers, and all the very best. Thank you, Hello? Hello? Is there a problem on this? Any problem on line? We are there, Shini. I'm also here, but I'm hearing some beep. Okay. Just wait for some time. Can the operator please help? I can keep your line as in. You can go ahead, please. Sure. Thanks thanks for the opportunity. A couple of questions on the business. Basically, just wanted to understand this new CRM, which which we have been mentioned in the presentation, how it will help in our business with respect to with respect to the renewal business and also anything which could which could improve our lock issue. And whether I also wanted to understand that it's completely a new thing that we have started or we have acquired it from somewhere? Okay. Thank you for your question. I think CRM is a normal process that is there. So what we have done was we had individual CRMs there. Now we have put it simply together, and obviously, the flow and the customer view gets better. And and and you can see the history of the customer, how it's moving, what are the issues, what worries it has. So it is just how should the enhancement of our capabilities in terms of looking at the customer. So the customer experience should get better. And in terms of how we look at cross sell and upsell, we'll get better. And in terms of servicing, we'll get better. So our hope is that this will lead to a better customer experience. Oh, is it Is it predominantly towards better business, or is it it's it's something to do or we I will I said we individually had CRM for different departments. We're just trying to put it all together, no, and have a consistent flow. See, let me just add to what Patan said. Both Magic and Dalit are undergoing significant technology transformations. And the pace of that will further accelerate after this lockdown and the number of customer acceptance of digital business. There are number of digital properties that we have in both the companies we have built over the last few years. We do not advertise that so much because a lot of them are behind the scenes helping the customers or carrying the U. App for Badgeek is really state of the art. Similarly, in Diamond, we have apps for the agent. The entire office on the finger tip is available for both the companies. The CRM is the next related version of software. It will put together all the properties that we have, and will sit on top of the core systems. In both the companies, we are also enhancing the core systems. And in the process of changing the core systems, we are doing significant amount of reengineering to make all the processes seamless as well. Clearly, BALIC had a bit of a drawback because there's no requirement of even basic KYC to take an insurance policy. But over time, we have built a database and with more retention of customers, we have increased the number of people who are adopting the data. And it also has significantly improved the quality of data. And I must say that the growth in renewal premium that we are seeing in both the companies is largely coming out of the focus on using this analytics any significant investment exposure and added duration of the bonds. That is on budget. And second on valid, given given we had a little adverse experience in group health, group group life or credit life, whether whether we have the change of our pricing in credit life in the in the coming year, in in this year. And second, we subject to maybe basic, this thing that we'll be marking data effective tax rate or effective tax rate. In badges, our duration is 3.1. We do not have any we have some exposure, but the exposure is much more nominal now. Same with balance on the non par and the shareholder funds. As I said earlier, we have cleaned up a lot of the investments. We have made provisions, and we have sold out some of the investments that that's before things got worse. So I think we are on a reasonably good because, yeah, going forward, we have committed external market risk. Today, even, you know, there are companies we thought were first class, and also it could become bad. But that is the market risk that we have to take, and we have to have early problem recognition. That's about it. The second question, I have left Arun here. Yeah. So you asked two questions. One more on the credit side. The other, I didn't get on credit insurance. The other one was on? Other one from just to understand the deal, margin cost we have reported closer to 10%. Is it based on effective tax rate, or is it based on subsidy tax rate? Look. So the second one, I'll let Bharat answer. I'll just close the first one quickly with you. So see, Credit Life is actually a very lovely product. The genesis of bank assurance from France is actually entirely based on the Credit Life kind of products long time back and therefore works quite well. Dynamically, what we've been doing the last couple of years is that we've been pricing our credit life quite close to mortality experiences. The challenge usually is that they're very difficult times to get very difficult to get lead indicators. You can always get lag indicators. But what we've done last year is that we've taken that by the bull by the horns and doing a lot more dynamic pricing and ensuring that we've now got systems online with all our NFI and bank partners and the mortgage book. The bulk of the credit life hits that usually has been coming to the market within the NFI business. There, we've been letting go of all the partners we used have. So we've been marketing leaders in that. But what we've done is now we have just talked about the key seven, eight players who are a lot better place in tech and risk systems so that portfolio only been getting better. What we've also done is as we have gone this year, we have already repriced our our reserving and passed that cost down to our partners. So we should be a lot better place. But having said that, this is like I said, it doesn't have too many lead indicators. It's largely lagging indicators. What we also done is a lot more analytics happening on the MFI defaults and and and also on MFI kind of ratings that we have. At the same time, there's a lot of analysis around the kind of products that are sold, which usually are to be joint life or single life products. We're also quite mindful of the exposures we are taking to various states depending upon the dynamics we are seeing in every state. Because we are a pretty large we write about two and a half crores of number of lives overall in our credit life business. So you see a lot more dynamic pricing there. Bharat, can you answer the second one? Yeah. With respect to the taxes, we we don't use ETR today. We will use around 14.56% of our tax rate. But, obviously, given the payment that we did, if you were to take an ATM deduction, this will be an upside only. But for timing, we don't take that. Can we quantify that margin? How how much upside we can see from 10%, maybe just to understand how how we are all effectively? See, we don't have the we haven't done the detailed working in terms of the margin at least. But when I looked at the ETR, the ETR, even if we consider our current dividend rate, so so the effective tax rate for this year would have been 13.9 instead of what we have used as 14.56. Now this both will have a impact on both on EV as well as on the UMD that we haven't quantified because we don't shift to ETR as of now. Got it. Perfect. Thanks. That is for myself. Thank you. The next question is from the line of Akshay Toshinvar from Change Index. Please go ahead. Hi, sir. This is Harshit here from Change Index. Three questions. One, on the protection, our initial strategy was to price the product lower than the tier, but we need to take up on our new customer writing. So I think you mentioned about new product launch, where the underwriting month will be a bit easier and the cover limit will be lower. If you can shorten by that, do we also plan to shift updating the strategy to July some of company medicals and and take up some growth in that part? That's the first part. And the second part is your outlook of the on crop insurance. Both from the perspective that market three year policy, how do you see the market is going to grow? And and given our past experience of the three three years, how do you see this person? Thank you. So what's the first question to the life company? The first question was in the life insurance. Yeah. On the term. Question largely was that on the term and how we're going ahead and underwriting and whether using telemedical. Is that the question? Yes. And do we plan to and we also mentioned about the new product plans where the underwriting is conducted in the application, if if I have it correctly. Yeah. Yeah. Yeah. Okay. So, yes, Srini had mentioned about that. So we we entered the term market in January and, basically, testing waters after a long time. And we initially, therefore, got a very tight risk controls. It basically meant that any policy we sold had to undergo a medical. We were also at the same time using the very low cost term cover. So we were the least price in the market that helped us a lot to develop distribution, develop brand, and also get people interested more in our term offerings. But having said that, the COVID part has hit us. So as a result, we are now refiling our term plan where we are looking at nonmedical rates, introducing nonmedicals as well. This should be in the next one month, we should be having that launch. Of course, therefore, the way we are looking at the easing the underwriting is is more on the way the medical underwriting is done. What I personally believe is that tele medical and most even video MERs can be sometimes more effective and done if done properly. So we are developing a strong capability around that. We already have started it, actually. And to top it out, all we are also now intending to use learnings from underwriters and do some artificial intelligence benefits where we can use data from one one writer to the other and be able to standardize some of these things. So we are in a better place to handle Google's in these situations. So, largely, yes. While underwriting is gonna get stronger in the way we assess, it is gonna get lenient in the way medicals are done. Okay. And we are currently priced around forty, fifty, but 30 to 50% lower than than the major peers. That's that's the medical underwriting that decides that kind of price decline. All I want to understand that are you compromising on the margin, or is it just the underwriting strength which gets captured in the lower prices? Okay. That's a very good question. See, it's actually the better quality of life. So what's happening is because we are so there's well, medical is one part of it. The other part of financial underwriting where we do not today, a lot of life insurance companies take people take take customers with very low income. And so even if you have a 2 lakh, you know, annual income, you will be able to get a 50 lakh cover or a 1 crore cover. So we are very clear that we are tighter on the financial underwriting. And what we have seen with the aggregator who has a lot many much information from other players and even otherwise from our agency channel is that our the number of graduates and the better lives that we are getting is far higher proportion versus what we used to get in the past and versus what other people are getting as well. So there are a few aspects other than medical underwriting that underplay that play there. In terms of I don't know the margins of other players, so I can't comment on that. But because the quality of life itself is so good, I don't see there'll be an issue around the D and B. Okay. Perfect. Perfect. And from the general insurance side, the crop insurance aspect, so it it has been a volatile business. We had a good, we had a a not so good in the current season. In general, how should one look at that business from and how did you look at that business specifically? And with the three year plus rather than a three year contract, how do you think that's that's the impact? Okay. Yeah. I'll take the question. So if you look at our crop business, the years, there's not quite a single year in which you lost money. Even this year also, combined ratio is below 100. All business, GI business are volatile. If you look at automobile business, one in five cars has an accident. If you look at health business, one in ten percent gets admitted. We are in the business of risk, so I don't think that I can say that we would be so sure that no claims will happen at any point in time. Crop is a significant part of the business for industry. If you look at about 20% of industry business is crop. As a leading claim industry, I think we're into all lines of businesses. Crop is also one line of business. It is not something that separate another business. If you look at we are into motor, we are into health, are into crop, into liability, are into fire, we are into engineering. And you see in most of lines of businesses, we would be close to our market shares. So if you look at Magic market share, if it is at close to 7%, you'll find most end of business are at 7% or a bit lower, a bit higher depending on how we play that. And crop is also like that. You'll find crop that also we're either overweight or underweight. It will be close to what our market share is. That is our philosophy. We try to write all lines of businesses and we tend to understand and do it well. So past track record says that we have always made money in crop also. And going forward also, we shall look at opportunities. It is a question of right pricing. It is not a question of what is good or bad in GI business. And volatility in GI business of claims is always there. We had five plus last year, and that also is volatile. If we get afraid of volatility of business and we move out of all lines of businesses to be secure, I don't think that is a business model. In the GI business, risk is there, volatility is there. Good underwriters know how to spread the risk and how to underwrite the business. And if it's not good pricing, then we don't write. So that is the philosophy which has been there for all lines of business and for crop also remains the same. So that is fine. If a three year contract comes in, the pricing is done on that basis in the market, and that is how it works out. So the players would now decide what is the right pricing for a three year contract, and they look into it, that is where the data would be there from their perspective. So And pricing is is decided annually. Is there any clause of annual dividend or it's can I fix three year pricing? No. It's a three year pricing. That's what tenders get done, but tenders can be decided on that basis. There would be an exit clause with penalty, you know, but that is what the government is looking. So those will get refined as the tenders keeps on coming. Thank you. As there are no further questions, I would now like to hand the conference over to Ms. Mani Papchi for closing comments. Financial. I would like to thank mister Sriharasil and the senior management team of the insurance businesses and all the participants joining us on the call today. Thank you, and have a good day. Goodbye. Thank you, dear. Thank you all. Thank you. On behalf of GM Financial Services, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you. Thank you.