Dear Members,
The Board of Directors are pleased to present the Twenty-Third Annual Report of ICICI
Lombard General Insurance Company
Limited ("the Company") along with the Audited Financial
Statements for the financial year ended March 31, 2023.
BUSINESS OUTLOOK
Industry in FY2023
The general insurance industry has undergone significant changes during the financial
year 2023. The pandemic has accelerated the industry?s digital
transformation, which has resulted in increased demand for new insurance products and
services. The Insurance Regulatory and Development Authority of India ("IRDAI")
has introduced several reforms during this financial year, to expand the insurance market
and increase insurance penetration.
The Gross Direct Premium Income ("GDPI") of the non-life insurance industry
grew from Rs. 2,207.00 billion in FY2022 to Rs. 2,569.12 billion in FY2023, a
growth of 16.4%. The market share of private players increased from 49.7% in FY2022 to
51.4% in FY2023 [Source: IRDAI and General Insurance Council].
Company in FY2023
The Company continues its journey of profitable growth through robust and prudent
underwriting practices, generation of cash flows through strong retention of premium and
judicious investments of the proceeds and focus on providing high quality customer
service. The Company recognises the responsibility to protect individuals and corporates
from various risks and contribute towards the larger goal of nation development. To fulfil
this obligation, the Company offers a wide range of general insurance products and
continuously introduces innovative products and services that not only enhance market
penetration but also helps in managing various risks.
The Company has undertaken various initiatives towards building better digital
platforms for claim management for its customers. The adoption of digital solutions has
enabled the Company to settle claims remotely and efficiently, resulting in significant
time savings and higher customer satisfaction levels. The Company has embraced
cutting-edge technologies such as artificial intelligence and machine learning, as well as
chatbots, to provide customers with an enhanced experience at every stage of their
journey, from onboarding to claims settlement.
In FY2023, the Company?s GDPI stood at Rs. 210.25 billion as compared to
Rs. 179.77 billion in FY2022, a growth of 17.0%.
The Net Earned Premium stood at Rs. 148.23 billion in FY2023 as against Rs. 130.32
billion in FY2022.
During the year under review, the Company has issued 32.7 million policies and honoured
over 3.6 million claims.
The Company continue to lead the private players in the industry and has maintained its
position of second largest player within the overall non-life insurance market. The market
share of the Company is 13.3% (GDPI basis) among private-sector non-life insurers in India
including standalone health insurers, while the overall market share of the Company is
8.2% (GDPI basis) among all non-life insurers in India.
FINANCIAL HIGHLIGHTS
The financial performance of the Company for FY2023 vis-a-vis FY2022 is summarised in
the following table:
(Rs. in billion)
Particulars |
FY2022 |
FY2023 |
% change |
Gross written premium |
185.62 |
217.72 |
17.3% |
Net written premium |
134.90 |
155.40 |
15.2% |
Net earned premium |
130.32 |
148.23 |
13.7% |
Net claims incurred |
97.82 |
107.26 |
9.7% |
Income from |
30.00 |
29.63 |
(1.2%) |
investments |
|
|
|
Profit before tax |
16.84 |
21.13 |
25.5% |
Profit after tax |
12.71 |
17.29 |
36.0% |
Earning per share- |
25.91 |
35.21 |
35.9% |
Basic (Rs.) |
|
|
|
Earning per share- |
25.82 |
35.16 |
36.2% |
Diluted (Rs.) |
|
|
|
Net worth |
91.10 |
103.92 |
14.1% |
Investment assets |
387.86 |
431.80 |
11.3% |
Combined ratio |
108.8% |
104.5% |
4.3% |
APPROPRIATIONS
The profit after tax for the financial year ended March 31,
2023 is Rs. 17.29 billion. The profit available for appropriation is
Rs. 38.82 billion after taking into account the balance of profit of Rs. 21.53 billion
brought forward from the previous year.
During the year under review, the Company paid Rs. 4.50 per equity share as an interim
dividend for FY2023 i.e. at the rate of 45.0% of face value of Rs. 10 each, aggregating to
Rs. 2.21 billion. The Board of Directors of the Company, at their Meeting held on April
18, 2023 had recommended a final dividend of
Rs. 5.50 per equity share i.e. at the rate of 55.0% of face value of Rs. 10 each for
FY2023, to the Members of the Company for their approval. The declaration of dividend is
based on the Dividend Distribution Policy of the Company and assessment of performance,
capital, solvency and liquidity position of the Company.
Cumulatively, the Board of Directors of the Company had declared / recommended a total
dividend of Rs. 10 per equity share for FY2023, i.e. at the rate of 100.0% of face value
of Rs. 10 each. The dividend pay-out ratio for FY2023 is 27.0% as against 29.8% for
FY2022.
SOLVENCY
IRDAI requires insurance companies to maintain a minimum solvency of 1.5 times which is
calculated in a manner as specified in the Insurance Regulatory and Development Authority
of India (Assets, Liabilities and Solvency Margin of General Insurance Business)
Regulations, 2016. The solvency margin position of the Company as at March 31, 2023 is
2.51 times as compared to 2.46 times as at March 31, 2022. As on
March 31, 2023, the net worth of the Company has increased to Rs. 103.92 billion from
Rs. 91.10 billion as at March 31, 2022.
SHARE CAPITAL
The Authorised Share Capital of the Company as at March 31, 2023 is Rs. 5.50 billion
comprising of 550,000,000 equity shares of face value of Rs. 10 each. The issued,
subscribed and paid-up share capital of the Company as at March 31, 2023 is Rs. 4.91
billion comprising of 491,125,103 equity shares of face value of Rs. 10 each.
During the year under review, the Company has allotted 233,675 equity shares pursuant
to exercise of Stock Options by the eligible options holders under the ICICI
Lombard-Employees Stock Option Scheme-2005 ("ESOS"). The equity shares allotted
under ESOS ranks pari-passu with existing equity shares of the Company.
The Company has not issued any equity shares with differential voting rights or sweat
equity shares during the year under review.
NON-CONVERTIBLE DEBENTURES
As an integral part of the Scheme of Arrangement entered by the Company with Bharti AXA
General Insurance Company
Limited ("Bharti AXA"), the following non-convertible debentures issued by
Bharti AXA were transferred in the name of the Company on the same terms and conditions,
upon the
Scheme became effective i.e. from September 8, 2021:
1. 350, 10.5%, unsecured, subordinated, fully paid-up, listed, redeemable and
non-convertible debentures of face value of Rs. 1,000,000 each. The said non-convertible
debentures are listed on the debt segment of National Stock Exchange of India Limited
("350, Listed NCDs").
2. 2,200, 8.98%, unsecured, subordinated, fully paid-up, unlisted, redeemable and
non-convertible debentures of face value of Rs. 1,000,000 each ("2,200, Unlisted
NCDs").
The aforesaid non-convertible debentures were issued with a term of ten (10) years. In
terms of the Information Memorandum, the Company may exercise Call Option at the end of
five completed years from the Deemed Allotment Date and at the end of every year
thereafter before the redemption date, subject to the fulfillment of the prescribed
conditions and prior approval of IRDAI.
The Company has exercised Call Option for redemption of 2,200, Unlisted NCDs at par
aggregating to Rs. 2.20 billion on August 23, 2022, pursuant to IRDAI approval dated July
5, 2022. All the debenture holders holding 2,200, Unlisted NCDs as on the Record date i.e.
August 7, 2022 were paid full principal amount along with the interest due thereon on
August 23, 2022.
As at March 31, 2023, the Company has Rs. 0.35 billion outstanding NCDs,
comprising of 350, Listed NCDs. The Company has been regular in servicing its interest
obligation towards the 350, Listed NCDs.
CHANGE IN THE NATURE OF BUSINESS
During the year under review, there has been no change in the nature of the business of
the Company.
PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
The provisions of Section 186(4) of the Companies Act, 2013 ("the Act"),
require 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 recipient of the loan
or guarantee or security, are not applicable to the Company, being an insurance company.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS 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 and future operations of the Company.
BOARD OF DIRECTORS
The Company believes that a strong, independent and diverse
Board leadership ensures the deployment of effective corporate governance. The
significance of Board diversity is recognised by various statutes/regulations i.e. the
Insurance Act, 1938, the Guidelines for Corporate Governance for insurers in India issued
by IRDAI ("IRDAI CG Guidelines"), the Act and relevant rules made thereunder,
Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015 ("Listing Regulations") and accordingly, composition of the
Board of the Company is based on the prescribed regulatory requirements.
The Board of the Company is duly constituted with an optimum balance between Executive
and Non-Executive Directors for an effective functioning of the Board. As on March 31,
2023, the Board of the Company consists of total eleven (11) Directors, out of which six
(6) are Non-executive, Independent Directors, two (2) are Non-executive, Non-independent
Directors and remaining three (3) are Executive Directors including Managing Director
& CEO. The Company?s Board is chaired by a Woman Director, Lalita D.
Gupte, Non-executive, Independent Director.
None of the Directors of the Company are disqualified from being appointed as Directors
as specified in Section 164(1) and Section 164(2) of the Act. Further, all the Directors
of the Company have confirmed that they fulfill the criteria of fit and
proper? as laid down under IRDAI CG Guidelines.
Changes in composition of the Board of Directors of the Company
During the year under review, Vishakha Mulye (DIN: 00203578), Non-executive,
Non-independent Director of the Company had resigned from the Company with effect from May
20, 2022, due to her resignation from the services of ICICI Bank Limited.
The Board of Directors of the Company had placed on record its appreciation on the
contribution made by Vishakha Mulye during her tenure as a Non-executive, Non-independent
Director of the Company.
Further, the Board of Directors of the Company at their Meeting held on May 28, 2022,
based on the recommendation of the Board Nomination and Remuneration Committee, approved
the appointment of Rakesh Jha (DIN: 00042075), as an Additional Director in the category
of Non-executive,
Non-independent Director, subject to approval of Members of the Company. Subsequently,
the Members of the Company at the Twenty-Second Annual General Meeting ("AGM")
held on August 5, 2022, approved the appointment of Rakesh Jha as a Non-executive,
Non-independent Director, liable to retire by rotation.
Meetings of the Board of Directors
During the year under review, seven (7) Meetings of the Board of Directors of the
Company were held including one (1) Board Meeting to discuss the business strategies of
the Company. The details of the meetings of the Board of Directors of the Company held and
attended by the Directors during FY2023 are detailed in the Corporate Governance Report,
forming part of this Report.
Common Directorships
Section 48A of the Insurance Act, 1938 prescribes conditions for
appointment/continuation of appointment of common directors between insurance companies
and insurance agent, intermediary or insurance intermediaries. As on March 31, 2023, the
Company has four (4) Directors, falling within the criteria of common Director viz. Uday
Chitale, Ashvin Parekh, Sandeep Batra and Rakesh Jha.
The Company is in compliance with the applicable provision of the Insurance Act, 1938,
other circulars and notifications/ clarification issued by IRDAI in connection with the
appointment/continuation of Common Director.
Declaration of Independence
All Independent Directors of the Company have given declarations that they meet the
criteria of independence as laid down under Section 149(6) & (7) of the Act read with
the Companies (Appointment and Qualification of Directors) Rules, 2014 and Regulation
16(1)(b) and Regulation 25 of the Listing Regulations, as amended from time to time. All
the Independent
Directors have also confirmed that they have complied with
Schedule IV of the Act and the applicable provisions of the
Employees Code of Conduct of the Company. There has been no change in the circumstances
affecting their status as an
Independent Directors of the Company.
Retirement by Rotation
In terms of provisions of Section 152 of the Act, Sanjeev
Mantri, Executive Director (DIN: 07192264) would retire by rotation at the forthcoming
AGM and is eligible for re-appointment. Sanjeev Mantri has offered himself for
re-appointment. A resolution seeking Members approval for re-appointment of Sanjeev Mantri
is forming part of the AGM Notice. Sanjeev Mantri is not disqualified from being appointed
as a Director under Section 164 of the Act. The profile and particulars of experience,
attributes and skills of Sanjeev Mantri together with his other directorships and
committee memberships have been disclosed in the annexure to the
Notice of the AGM.
PERFORMANCE EVALUATION OF BOARD, ITS COMMITTEES, CHAIRPERSON AND INDIVIDUAL DIRECTORS
Pursuant to the provisions of the Act, Listing Regulations and in accordance with
Guidance Note on Board Evaluation issued by SEBI on January 5, 2017, an annual performance
evaluation had been carried out of the Board as a whole, its Committees, individual
Directors both Executive and Non-executive including Independent Directors and Chairperson
of the Board.
The manner in which the evaluation has been carried out is explained in the Corporate
Governance Report forming part of this Report.
KEY MANAGERIAL PERSONNEL
Pursuant to the provisions of Section 203 of the Act, the Key
Managerial Personnel (KMP) of the Company as on March 31, 2023, are as under:
1. Bhargav Dasgupta, Managing Director & CEO
2. Alok Kumar Agarwal, Executive Director
3. Sanjeev Mantri, Executive Director
4. Gopal Balachandran, Chief Financial Officer & Chief Risk Officer
5. Vikas Mehra, Company Secretary
In accordance with the IRDAI CG Guidelines, the Company has following Key Management
Persons in addition to aforesaid KMPs:
1. Girish Nayak, Chief-Technology & Heath Underwriting &
Claims
2. Sanjay Datta, Chief-Underwriting, Reinsurance and Claims*
3. Jerry Jose, Chief-Human Resources
4. Vinod Mahajan, Chief Investment Officer
5. Prasun Sarkar, Appointed Actuary and Chief Actuarial Officer
6. Amit Kushwaha, Head-Legal & Chief Compliance Officer
7. Sandeep Goradia, Chief-Corporate Solutions Group^
8. Gaurav Arora, Chief - Underwriting & Claims, Property &
Casualty#
9. Vasundhara Bhonsle, Chief-Customer Support and Operations$
^The Board of Directors at their Meeting held on May 28, 2022, based on the
recommendation of the Board Nomination and Remuneration Committee has approved the
appointment of Sandeep Goradia as Chief-Corporate Solutions
Group and a Key Management Person in terms of IRDAI CG Guidelines, with effect from May
28, 2022.
*The Board of Directors at their Meeting held on February 20, 2023 had noted that
Sanjay Datta, Chief-Underwriting, Reinsurance & Claims and a Key Management Person of
the Company is scheduled to retire on July 31, 2023, from the services of the Company.
Sanjay Datta intend to pursue his professional career in other opportunity(ies) within the
ICICI Group and accordingly would be relieved from the services of the Company with effect
from May 1, 2023.
Further, the Board of Directors at their Meeting held on February 20, 2023, based on
the recommendation of the Board Nomination and Remuneration
Committee also approved the following:
#Appointment of Gaurav Arora, Chief - Underwriting & Claims, Property &
Casualty and a Key Management Person in terms of IRDAI CG Guidelines, with effect from
February 20, 2023. $Appointment of Vasundhara Bhonsle, Chief-Customer Support and
Operations and a Key Management Person in terms of IRDAI CG Guidelines, with effect from
February 20, 2023.
Criteria for appointment of Director, Key Managerial Personnel and officials who may be
appointed in senior management
The Company has a Board approved criteria for appointment of a Director, key managerial
personnel and officials who may be appointed in Senior Management ("the
Criteria"). It includes the criteria for determining qualifications, positive
attributes and independence of a Director, identification of persons who are qualified to
become Directors, Key Managerial Personnel and who may be appointed in the Senior
Management in accordance with the criteria laid down. The Criteria is hosted on the
website of the Company and can be viewed at https://
www.icicilombard.com/docs/default-source/policies-of-the-company/criteria-for-appointment-of-a-director-key-managerial-personnel-and-officials-who-may-be-appointed-in-senior-management.pdf.
Policy on appointment and compensation of Employees and framework for remuneration to
Non-executive Directors
The Company has a Board approved Policy on appointment and compensation of Employees
and framework for remuneration to Non-executive Directors ("the Policy"). The
Policy lay down guidelines on fixing compensation of employees including KMPs, Whole-time
Directors and Non-executive
Directors of the Company. The philosophy of the Company on compensation and benefits is
based on the ethos of meritocracy and fairness. The twin pillars of performance management
and talent management system are closely intertwined with the compensation, benefits and
reward mechanism of the Company. While the Company will strive to ensure internal and
external equity that are consistent with emerging market trends, its business model and
affordability based on business performance sets the overarching boundary conditions. The
Policy is hosted on the website of the Company and can be viewed at https://www.icicilombard.
com/docs/default-source/policies-of-the-company/policy-on-appointment-and- compensation-
of- employees-and-framework-for-remuneration-to-non-executive-directors.pdf
Deposits
During the year under review, the Company has not accepted any deposits under Section
73 of the Act.
AUDITORS
Statutory Auditors
Pursuant to the provisions of Section 139 of Act, every company is required to appoint
a Statutory Auditor for audit of financial statements of company. Further, IRDAI CG
Guidelines required every insurance company to appoint minimum two auditors as Joint
Statutory Auditors.
Chaturvedi & Co., Chartered Accountants (Firm Registration No. 302137E) and PKF
Sridhar & Santhanam LLP, Chartered Accountants (Firm Registration No. 003990S/S200018)
are the Joint Statutory Auditors of the Company.
As per the IRDAI CG Guidelines, a Statutory Auditor can conduct audit of insurance
company for a continuous period of up to ten (10) years. Further, as per the Act, an audit
firm can be appointed as Statutory Auditor for not more than two terms of five (5)
consecutive years each.
The Members of the Company in the Eighteenth AGM held on July 12, 2018 had approved
re-appointment of Chaturvedi & Co., Chartered Accountants, as one of the Joint
Statutory Auditors of the Company for a second term of five (5) consecutive years till the
conclusion of Twenty-Third AGM.
Further, the Members of the Company in the Twenty-First AGM had approved re-appointment
of PKF Sridhar & Santhanam LLP, Chartered Accountants as one of the Joint Statutory
Auditors of the Company for a second term of five (5) consecutive years till the
conclusion of Twenty-Sixth AGM.
As per the provisions of the Act read with rules made thereunder and IRDAI CG
Guidelines, the current second term of Chaturvedi & Co., Chartered Accountants would
complete at the conclusion of the Twenty-Third AGM. The Audit Committee and the Board of
Directors of the Company have placed on record their sincere appreciation for the
professional services rendered by
Chaturvedi & Co., Chartered Accountants during their tenure as one of the Joint
Statutory Auditors of the Company.
The Board of Directors of the Company at their Meeting held on April 18, 2023, based on
the recommendation of the Audit Committee and after considering the qualifications and
experience of Walker Chandiok & Co. LLP, Chartered Accountants (Firm Registration No.
001076N/N500013) and being satisfied that qualifications and experience of Walker Chandiok
& Co. LLP, Chartered Accountants is commensurate with the size and requirements of the
Company, recommended their appointment as one of the Joint Statutory Auditors of the
Company for a period of five (5) consecutive years till the conclusion of Twenty-Eighth
AGM, to the Members for their approval.
Walker Chandiok & Co. LLP, Chartered Accountants have expressed their willingness
to act as one of the Joint Statutory
Auditors of the Company and have confirmed that they fulfill the conditions of
eligibility to be appointed as one of the Joint Statutory Auditors of the Company, as
required under the provisions of Sections 139 and 141 of the Act and
IRDAI CG Guidelines.
As required under the Listing Regulations, Walker Chandiok, &
Co. LLP, Chartered Accountants, have also confirmed that they hold a valid Peer Review
Certificate issued by the Peer Review Board of the Institute of Chartered Accountants of
India. Pursuant to the IRDAI CG Guidelines and the applicable provisions of the Act, the
Board of Directors of the Company, based on the recommendation of the Audit Committee had
approved payment of Rs. 14.1 million as remuneration to each of the Joint Statutory
Auditors of the Company for statutory audit of financial statements and financial results
of the Company for FY2024 including fee for audit of financial statements of International
Financial Services Centre Insurance Office ("IIO"), fees for reviewing the
internal financial controls of the Company, issuing certificate on compliance of
conditions of Corporate Governance prescribed under the Listing Regulations and other
matters as prescribed under the Auditing Standards, subject to approval of the Members of
the Company.
The resolution seeking Members approval for appointment of Walker Chandiok & Co.
LLP, Chartered Accountants as one of the Joint Statutory Auditors of the Company, for a
first term of five (5) consecutive years is forming part of the Notice of Twenty-Third
AGM. The brief profile of Walker Chandiok & Co. LLP, Chartered Accountants is provided
in the explanatory statement to the Notice of Twenty-Third AGM.
Also, the resolution seeking Members approval for fixing audit remuneration of PKF
Sridhar & Santhanam LLP, Chartered Accountants and Walker Chandiok & Co. LLP,
Chartered Accountants, for FY2024 is forming part of Notice of
Twenty-Third AGM.
Statutory Audit remuneration and other fees
The details of remuneration and other fees paid to Chaturvedi &
Co. and PKF Sridhar & Santhanam LLP, Joint Statutory Auditors of the Company for
FY2023 are provided below:
(Rs. in million)
Particulars |
Amount |
Statutory Audit Fees including Certificate on |
27.00 |
compliance of conditions of Corporate Governance |
|
as prescribed under the Listing Regulations and |
|
Internal control over financial reporting |
|
Tax Audit Fees |
1.70 |
Certification Fees |
3.22 |
Total |
31.92 |
Statutory Auditors Report
The Joint Statutory Auditors? Report for FY2023 on the financial
statements of the Company forms part of this Annual Report.
The Joint Statutory Auditors have expressed their unmodified opinion on the the
financial statements and their reports do not contain any qualifications, reservations,
adverse remarks, or disclaimers.
Secretarial Auditor
Pursuant to provisions of Section 204 of the Act and the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, the Company had appointed Dholakia
& Associates LLP, Practicing Company Secretaries for conducting the secretarial audit
of the Company for FY2023. The Secretarial
Audit Report forms part of this report as Annexure A. There are no
qualifications, reservation or adverse remark or disclaimer made by the Secretarial
Auditor in the report.
The Board of Directors at their Meeting held on April 18, 2023, based on the
recommendation of the Audit Committee, had approved re-appointment of Dholakia &
Associates LLP, as a Secretarial Auditor of the Company for conducting Secretarial Audit
for FY2024. The Company has received consent from Dholakia & Associates LLP along with
their eligibility to act as a Secretarial Auditor of the Company for FY2024.
Reporting of Frauds by Auditors
During the year under review, the Joint Statutory Auditors and Secretarial Auditor of
the Company have not reported any instances of frauds committed in the Company by its
Officers or Employees to the Audit Committee of the Board under
Section 143(12) of the Act.
Maintenance of Cost Records
Being an Insurance Company, the Company is not required to maintain cost records as
specified by the Central Government under Section 148(1) of the Act.
COMPLIANCE TO SECRETARIAL STANDARDS
During the year under review, the Company has been in compliance with the applicable
Secretarial Standards i.e. SS-1 and SS-2, issued by the Institute of Company Secretaries
of India, with respect to Meetings of Board and its Committees and General Meetings
respectively. The Company has devised necessary systems to ensure compliance with the
applicable provisions of Secretarial Standards.
PARTICULARS OF EMPLOYEES
The statement containing particulars of employees as required under Section 197 of the
Act read with Rule 5(1) of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014, forms part of this Report as
Annexure B.
The statement containing particulars of employees as required under Section 197 read
with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014 forms part of this Report. Pursuant to the provisions of the Act, the Annual
Report including Financial Statements are being sent to the Members of the Company
excluding the aforesaid statement. Further in terms of Section 136 of the Act, the said
annexure is open for inspection and any Member interested in obtaining a copy of the same
may write to the Company Secretary of the Company at investors@icicilombard.com.
RELATED PARTY TRANSACTIONS
The Company undertakes various transactions with related parties in the ordinary course
of business pursuant to the
Policy on Related Party Transactions and Framework on
Related Party Transactions approved by the Board of Directors of the Company.
All related party transactions that were entered, during the year under review, were at
an arm?s length basis, and in the ordinary course of business and are in
compliance with the applicable provisions of the Act and the Listing Regulations.
The Audit Committee has granted omnibus approval to enter into different types of
related party transactions which are in ordinary course of business, repetitive in nature
and in the best interest of the Company. Further, all related party transactions entered
were placed before the Audit Committee on a quarterly basis for which the Company had
taken omnibus approval from the Audit Committee.
During the year under review, the Company has amended its Policy on Related Party
Transactions and Framework on Related
Party Transactions in line with the amendment made in the
Listing Regulations. The Policy on Related Party Transactions is hosted on the website
of the Company and can be viewed at https://www.icicilombard.com/docs/default-source/policies-of-the-company/policy-on-related-party-transactions.pdf
Particulars of Contracts or Arrangements with Related Parties
Pursuant to the provisions of Regulation 23 of the Listing Regulations, effective April
1, 2022, prior approval of Members is required to be sought by means of an ordinary
resolution for related party transactions, which are material, even if such transactions
are in the ordinary course of the business of the
Company and at an arm?s length basis. A transaction with a related party
is considered material if the transaction(s) to be entered into individually or taken
together with previous transactions during a financial year, exceeds Rs. 1,000 crore or
10% of the annual consolidated turnover as per the last audited financial statements of
the listed entity, whichever is lower.
The Company had identified material related party transactions for FY2023 which
required prior approval of the Members of the Company. Accordingly, the Audit Committee
and Board of Directors of the Company, through Circular Resolution passed on March 31,
2022 and April 6, 2022 respectively, had approved/considered material related party
transactions for
FY2023. Subsequently, the Members of the Company through
Postal Ballot on May 23, 2022 had approved material related party transactions for
FY2023.
The Company had further taken approval from the Members in the Twenty-Second AGM of the
Company held on August 5,
2022, for material related party transactions that the Company may enter in FY2024 and
which may exceed the threshold of "material related party transactions"
prescribed under the Listing Regulations. All the transactions as approved by the Members
will be executed at an arm?s length basis and in the ordinary course of
business of the Company.
During the year under review, all the transactions with related parties were in the
ordinary course of business and at an arm?s length basis. During the year
under review, the Company had not entered into any contract / arrangement / transaction
with related parties which is required to be reported in Form No. AOC-2 in terms of
Section 134(3)(h) read with Section 188 of the Act and Rule 8(2) of the Companies
(Accounts) Rules, 2014.
As required under Regulation 53(f) read with Para A of Schedule V of the Listing
Regulations and Accounting Standard (AS) 18 on Related Party Disclosures, the details of
related party transactions entered into by the Company during FY2023 are covered in the
Notes to Accounts forming part of the Financial Statements. The Joint Statutory Auditors
of the Company have issued an unmodified opinion on the Financial Statements for FY2023
which includes therein related party transactions and related disclosures thereon.
ANNUAL RETURN
Pursuant to Section 134(3)(a) of the Act, the Annual Return of the Company prepared as
per Section 92(3) of the Act for the financial year ended March 31, 2023, is hosted on the
website of the Company and can be viewed at http://www.icicilombard.com/docs/default-
source/ information-to-shareholders/icicilombardmgt72023. In terms of Rules 11 and 12
of the Companies (Management and
Administration) Rules, 2014, the Annual Return shall be filed with the Registrar of
Companies, within the prescribed timelines.
RISK MANAGEMENT FRAMEWORK
The Company recognizes that risk is an integral element of insurance business and with
a view to mitigate risks, the Company has in place Board approved Risk Management
Framework.
A strong risk culture is ensured through embedding the principles of Risk Management
Framework in strategy and operations. Accordingly, the Company has developed a risk
universe consisting of 28 enterprise-wide risk areas, broadly categorised into six
distinct groups, namely, Credit risk, Market Risk, Underwriting Risk, Strategic Risk,
Operational Risk and Environmental, Social and Governance Risk.
As part of the Enterprise Risk Management exercise, critical risks along with the
detailed mitigation plans are presented to the Risk Management Committee of the Board on a
quarterly basis. The risk mitigation plan is monitored regularly by the Company to ensure
timely and appropriate execution. The senior management of the Company is responsible for
periodic review of the risk management process to ensure that the process initiatives are
aligned to the desired objectives. The Chief Risk Officer of the Company is responsible
for the implementation and monitoring of the Risk Management Framework.
A statement indicating development and implementation of Risk Management Framework
including identification therein elements of risk, if any, which may pose significant risk
to the Company are given in the Corporate Governance Report forming part of this Report.
DISCLOSURES AS PER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION
AND REDRESSAL) ACT, 2013
The Company has zero tolerance towards sexual harassment and is committed to provide a
safe environment for all, which is achieved through well-established robust mechanism for
redressal of complaints reported under it.
The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal)
Act, 2013 provides protection against sexual harassment of women at workplace and lays
down the guidelines and timelines for the prevention and redressal of complaints
pertaining to sexual harassment. Accordingly, the Company has in place the guidelines on
prevention of Sexual Harassment at Workplace and a formal process for dealing with
complaints of sexual harassment, in compliance with aforesaid Act. The Company ensures
that all such complaints are resolved within defined timelines.
Details of complaints are as follows:
Sr. No. |
Particulars |
Amount |
a. |
Number of complaints pending as on April 1,
2022 |
3 |
b. |
Number of complaints filed during the
financial year |
6 |
c. |
Number of complaints disposed of during the
financial year |
7 |
d. |
Number of complaints pending as on March 31,
2023 |
2* |
*The two Complaints pending as on March 31, 2023 were reported in the month of December
2022 and March 2023. The Complaint received in the month of December 2022 was closed as on
the date of this report whereas the other complaint received in the month of March 2023
was in the internal Committee?s process as on the date of this Report.
To build awareness in this area, the Company has been conducting induction/refresher
programmes on a continuous basis. During the year under review, the Company has organised
online training sessions on the topics of Gender Sensitisation and Prevention of Sexual
Harassment ("POSH") for its employees.
Internal Committee for redressal of complaints
The Company has constituted a Committee for redressal and timely management of sexual
harassment complaints. The Internal Committee has a minimum 50% women representatives. The
Internal Committee has a senior woman leader as the presiding officer of the Committee and
one external member who is a subject matter expert in this regards.
The Company is in compliance with the provisions relating to the constitution of an
Internal Committee under the Sexual Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013.
RURAL AND SOCIAL RESPONSIBILITY
As per the Insurance Regulatory and Development Authority of India (Obligations of
Insurers to Rural and Social Sectors), Regulations, 2015, the Company has issued 9,210,458
policies in rural areas and covered 6,275,653 lives falling within the norms of social
responsibility. The Company has complied with the obligations laid down by IRDAI.
DIVIDEND DISTRIBUTION POLICY
In accordance with Regulation 43A of the Listing Regulations, the Company has adopted
the Dividend Distribution Policy, which covers various parameters based on which the Board
may recommend or declare Dividend. The Dividend Distribution Policy of the Company is
hosted on website of the Company and can be viewed at https://www.icicilombard.com/docs/
default-source/policies-of-the-company/dividend-distribution-policy.pdf
UNPAID/UNCLAIMED DIVIDEND
As per Section 124 and 125 of the Act read with the Investor Education and Protection
Fund (Accounting, Audit, Transfer and Refund) Rules, 2016, any dividends that remain
unclaimed/unpaid for a period of seven years must be transferred to the Investor Education
and Protection
Fund ("IEPF"). During the year under review, unpaid / unclaimed dividend of
FY2015 and FY2016 of Rs. 300/- and
Rs. 450/- respectively was transferred by the Company to IEPF. The details of
outstanding and unclaimed dividends previously declared and paid by the Company along with
the due date of transfer to IEPF are covered in the Corporate Governance Report forming
part of this Report.
CORPORATE SOCIAL RESPONSIBILITY & SUSTANABILITY
Corporate Social Responsibility ("CSR") & Sustainability has been a
long-standing commitment of the Company and forms an integral part of its activities. The
Company?s CSR & Sustainability activities primarily focuses on areas like
health care, road safety, ensuring environment sustainability, education, skill
development and sustainable livelihoods. The CSR & Sustainability activities are
largely implemented either directly or through ICICI Foundation for Inclusive
Growth. The Company has duly constituted the Corporate
Social Responsibility & Sustainability Committee ("CSR & Sustainability
Committee") in accordance with the provisions of the Act and IRDAI CG Guidelines. The
Company has formulated the Corporate Social Responsibility Policy which sets out the
framework guiding the Company?s CSR
& Sustainability activities. The CSR Policy also sets out the rules that need to be
adhered to while taking up and implementing CSR & Sustainability activities. The CSR
Policy is hosted on the website of the Company and can be viewed at https://www.icicilombard.com/docs/default-
source/ policies-of-the-company/csr-policy.pdf
The Board of Directors of the Company at their Meeting held on July 19, 2022, based on
the recommendation of
CSR & Sustainability Committee, had approved the CSR &
Sustainability plan for FY2023 of Rs. 342.6 million i.e. 2% of the average net profits
of the Company made during three immediately preceding financial years. The Company has
chosen specific areas to focus as part of its CSR & Sustainability roadmap. These
include health care, road safety, education, environment sustainability and skill
development & sustainable livelihoods.
The CSR & Sustainability plan of the Company for FY2023 was modified by the Board
of Directors at their Meeting held on January 17, 2023, based on the recommendation of the
CSR & Sustainability Committee in order to include new initiatives within the purview
of CSR Policy of the Company.
The Company?s actual CSR & Sustainability expenditure was Rs.
347.3 million for FY2023.
In FY2022, total amount of Rs. 29.7 million pertaining to ICICI
Foundation?s ongoing project towards skill development & sustainable
livelihoods was unspent by ICICI Foundation in FY2022 and the same was transferred by the
Company in the Unspent CSR Bank account? within the specified timelines
in accordance with the provisions of the Act and rules made thereunder. During FY2023,
ICICI Foundation has spent the entire amount allocated towards CSR for FY2023 along with
unspent CSR obligations of FY2022.
The total CSR & Sustainability spent during FY2023 was
Rs. 377.0 million (i.e. Rs. 347.3 million actual expenditure for FY2023 and Rs. 29.7
million being unspent amount of FY2022). There are no unspent funds required to be carried
forward to succeeding years.
In accordance with the provisions of the Act, the Chief
Financial Officer of the Company has certified that the CSR & Sustainability spent
of the Company for FY2023 were utilised for the purpose and in the manner as approved by
the Board of Directors of the Company from time to time. The certificate in this regard
was also placed before the Board of Directors at their Meeting held on April 18, 2023.
The Annual Report on CSR activities of the Company for
FY2023 forms part of this Report as Annexure C. The Company has carried out
Impact assessment of its Ride to Safety, Caring Hands and Niranjali CSR projects in
pursuance of Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014
as amended. The executive summary of Impact Assessment
Reports are covered in the Annual Report on CSR Activities.
CREDIT RATING
During the year under review, the Company has maintained credit rating of "[ICRA]
AAA(Stable)" assigned by ICRA Limited and "CRISIL AAA/Stable" assigned by
CRISIL Ratings Limited on Rs. 0.35 billion subordinate debentures of the Company.
The ICRA Limited has reaffirmed Issuer Rating of "[ICRA] AAA(Stable)" to the
Company.
Pursuant to exercise of Call Option by the Company for redemption of 2,200, Unlisted
NCDs on August 23, 2022, the credit rating of "[ICRA] AAA(Stable)" assigned by
ICRA Limited and "CRISIL AAA/Stable" assigned by CRISIL Ratings Limited on Rs.
2.20 billion subordinate debentures was withdrawn during the year under review.
Further, AM Best has assigned a Financial Strength Rating of B++ (Good) and a Long-Term
Issuer Credit Rating of "bbb+" (Good) to the Company. The ratings reflect the
Company?s balance sheet strength, which AM Best assesses as very strong, as
well as strong operating performance, neutral business profile and appropriate enterprise
risk management.
BUSINESS RESPONSIBILITY AND SUSTAINBILITY REPORT
Pursuant to Regulation 34(2)(f) of the Listing Regulations, the Company is required to
publish Business Responsibility and Sustainability Report ("BRSR") as part of
its Annual Report.
The BRSR maps the sustainability performance of the Company against the nine principles
forming part of the National
Guidelines on Responsible Business Conduct issued by the Ministry of Corporate Affairs,
Government of India.
Accordingly, the BRSR describing various initiatives taken by the Company in FY2023 has
been hosted on the website of the
Company and can be viewed at https://www.icicilombard.com/
docs/default-source/esg/icici-lombard-business-responsibility-and-sustainability-report-fy2023-1.pdf.
ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT
The Company?s approach towards Environmental, Social and Governance
("ESG") is underpinned by a strong focus on fulfilling promises responsibly and
sustainably so as to benefit the society, employees, shareholders, communities, and all
other stakeholders. The Company is revisiting every facet of the organisation to put in
place processes, systems and teams to measure, manage and improve across ESG parameters.
The Company has also adopted a responsible and conservative approach to investing that
is focussed on balancing investment income to meet policyholder obligation and generating
surplus to drive long-term business growth sustainably.
The Company?s people-centric work culture provides opportunities for
growth and mental resilience for the Company?s employees, with a Diversity,
Equity and Inclusion ("DEI")strategy built around employees, customers, and
brand reputation. DEI vision includes building of an inclusive culture that attracts,
develops and celebrates diversity thereby driving innovation and delivering value for all
our stakeholders. The DEI strategy and vision is explained in the ESG Report of the
Company for FY2023.
The CSR & Sustainability Committee oversees and monitor Sustainability activities
including ESG & Business Responsibility and Sustainability initiatives undertaken by
the Company. Additionally, the Company also have an ESG
Steering Committee which ensures ESG strategy integration. The ESG Steering Committee
aims at discharging its oversight responsibility on matters related to organisation-wide
ESG initiatives, targets, action plan and leading ESG practices.
The ESG Report highlighting efforts made by the Company to build a sustainable business
model comprehensively for
FY2023 is hosted on the website of the Company and can be viewed at https://www.icicilombard.com/docs/default-source/
esg/icici-lombard-environmental-social-and-governance-fy2023.pdf
INTEGRATED REPORT
The Securities and Exchange Board of India vide its circular dated February 6, 2017 had
recommended the top 500 listed entities to voluntarily adopt Integrated Report as per
principles prescribed by the International Integrated Reporting Council.
The Company has voluntarily adopted the principles and has shifted its corporate
reporting journey to Integrated Report as per the International Integrated Reporting
Council ("IIRC") framework. The Integrated Report encompasses both financial and
non-financial information to enable the Members to take well informed decisions and have a
better understanding of the Company?s long term perspective. The
Company?s Integrated Report is based on six forms of capital viz. financial
capital, manufactured capital, intellectual capital, human capital, social &
relationship capital and natural capital.
The Company continues to publish its fifth Integrated Report which forms part of this
Annual Report.
INVESTOR RELATIONS
The Company is committed to achieving excellence in its Investor Relations engagement
with both International and
Domestic investors. To achieve this goal, the Company continuously adopts emerging best
practices in Investor
Relations and strives to build relationship of mutual understanding with
investor/analysts.
The importance of ESG has increased significantly in recent times. Therefore, the
Company has placed a strong emphasis on ESG and Sustainability initiatives to ensure
positive feedback from all its stakeholders. ESG initiatives of the Company encompasses
topics such as operational eco efficiency, strengthening diversity, responsible
investments, sustainable underwriting, strong governance, robust enterprise risk
management amongst others. The Company has disclosed its ESG initiatives as a part of BRSR
and ESG report which is hosted on its website.
The Managing Director & CEO, Executive Directors, Chief Financial Officer &
Chief Risk Officer and other authorised senior management members participate in
structured conference calls and periodic investor/analyst interactions including
one-on-one/group meeting, investor conferences and quarterly earning calls. The Company
has conducted 266 meetings with Indian and overseas investors and analysts (excluding
quarterly earnings calls) during the year. The transcripts of the quarterly earnings calls
and audio recordings are also hosted on the website of the Company and Stock Exchanges
where the securities of the Company are listed within the timelines as prescribed under
the Listing Regulations.
The Company had also organised an investor/analyst interaction to showcase its Digital
initiatives. The focus areas of the above meet included digital ecosystem, digital
solutions across the customer lifecycle, holistic risk management solutions and adoption
of digital processes across business lines.
The Company ensures that financial information is available to all the stakeholders by
uploading it on the Company?s website and website of the Stock Exchanges
where the securities of the Company are listed. The financial information includes
Financial Statements, Press Releases, Investor Presentations, Earning call transcripts,
publication of financial results in the newspapers and Annual Report, etc.
EVENTS AFTER BALANCE SHEET DATE
There have been no material changes and commitments, affecting the financial position
of the Company, between the end of the financial year of the Company to which the balance
sheet relates and the date of this report.
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