#1Investor Presentation 9M FY23 * शं AR D HDFC Life Sarutha ke jiyo!#2Executive summary: 9M FY23* $ Revenue & Scale Profitability & Cost Rs.Bn 68.3 Individual % CY 26.5% New Business WRP Margin (NBM) Market Share PY 26.5% 15.8% ***** Customer & Capital CY 87% 13th month persistency PY 87% Renewal CY 191.9 CY 21.6 Overall 99.6% Premium (Rs |VNB (Rs Bn.) Bn.) PY 144.7 PY 17.8 Claim settlement ratio (FY22) Individual 98.7% CY 2,338 Profit After CY 10.0 FY22 25 AUM (Rs Bn.) Tax (PAT) (Rs PY 1,947 Bn.) PY 8.5 Complaints per 10K policies FY21 29 Rs (Bn.) 377.0 Dec'22 209% CY 14.7% IEV Operating Solvency EVOP 17.5% exp. ratio Mar'22 176% PY 12.2% 1. Complaints data (excluding survival and death claims) * Current year numbers are on a merged basis, hence prior years are not comparable 2 HDFC Life#3Agenda 1 Performance Snapshot 2 Our Strategy 3 Our approach to ESG 4 Annexures 5 Life insurance in India HOM#4Consistent, predictable, sustained performance Holistic growth Consistent track record over multiple periods New business premium Renewal premium >2x ~2X 242 1.5x 218 ~3X 113 122 80 40 FY14 FY18 FY22 FY14 FY18 FY22 Protection APE² 13.2 >2x N4X 6.2 1.6 Annuity new business VNB FY18-22 >2X FY16-20 A>2.5x FY17-21 >2x 26.8 21.9 19.2 12.8 9.2 7.4 FY16 FY17 FY18 FY20 FY21 FY22 48.7 ~5X ~7X 10.7 1.6 FY14 FY18 FY22 FY14 FY18 FY22 AUM 13M persistency³ dd9+ ~ ~ +10pp 81% ~2X 2,042 71% >2x 1,066 506 Rs bn Embedded Value¹ FY18-22 ~2X FY16-20 >2x FY17-21 >2x 300 266 207 152 125 87% 102 Mar 31, 2014 Mar 31, 2018 Mar 31, 2022 FY14 FY18 FY22 1. Including cash payout of Rs 7.3 bn for acquisition of Exide Life, but excluding Exide Life's EV of Rs 29.1 bn 2. Based on Overall APE 4 3. Excluding single premium FY16 FY17 FY18 FY20 FY21 FY22 HDFC Life#5Demonstrating resilience in the current environment (1/2) Strong, sustainable growth Rs bn Strong CP volumes on the back of higher disbursements¹ Overall 8.1% 9.2% 9.3% 10.3% mkt share Pvt. mkt 14.2% 15.5% 14.8% 15.8% 17% YoY growth share in Q3 FY23* 17% -19% 55% 52% YOY 19% 17% 16% 13%* growth 70.0 81.5 68.3 59.7 FY20 Balanced product mix Total APE 2% 8% 25% 15% 18% 33% FY21 FY22 9M FY23 24% Total NBP 11% 11% 30% 53.0 52.3 42.4 34.2 FY20 FY21 FY22 9M FY23 YoY Growth Focus on diversified channel mix² 9% 7% 6% 9% 14% 13% 14% 18% Par 19% 19% 22% 15% 16% Non Par Savings ■ULIP Protection 55% 61% 60% 59% 9% Annuity Group Retirals FY20 FY21 FY22 9M FY23 Bancassurance ■Direct ■Agency ■Brokers and others 1. Based on Credit Protect new business premium 2. Based on Individual APE 5 * Current year growth numbers have been computed after factoring in Exide Life WRP in previous year - 9M and Q3 HDFC Life#6Demonstrating resilience in the current environment (2/2) Stable Persistency¹ Rs bn On track to achieving margin neutrality for FY232 87% 53% 87% 26.4% 26.5% 52% Focus on quality of business and providing superior customer experience 26.2% 26.5% 9M FY22 13th 61st 9M FY23 Strong growth in renewal premium² 9 1. 2. 191.9 144.7 9M FY22 9M FY23 ■ Backed by consistent improvement in overall persistency H1 FY23 9M FY23 PY NBM Steady solvency position² 209% 176% Mar 31, 2022 Dec 31, 2022 For individual business; Excluding single premium and fully paid up policies. Current year numbers are on a merged basis, hence prior year is not comparable Current year numbers are on a merged basis, hence prior year is not comparable Multiple pools of profitability contributing to VNB accretion ■ VNB has grown at 24% CAGR between FY17-22 Healthy solvency margin of 209% well above regulatory requirement HDFC Life#7Agenda 1 Performance Snapshot 2 Our Strategy 3 Our approach to ESG 4 Annexures 5 Life insurance in India HOM#8Key elements of our strategy 18 1 2 3 4 5 Focus on profitable growth Ensuring sustainable and profitable growth by identifying and tapping new profit pools Diversified distribution mix Developing multiple channels of growth to drive need-based selling Market-leading innovation Creating new product propositions to cater to the changing customer behaviour and needs Reimagining insurance Market-leading digital capabilities that put the customer first, shaping the insurance operating model of tomorrow Quality of Board and management Seasoned leadership guided by an independent and competent Board; No secondees from group companies "Our continuous focus on technology, diversification and customer-centricity has enabled us to deliver consistent performance even in the most challenging times" HDFC Life#9Accounting Economic Profit Focus on profitable growth Profit FY20 FY21 FY22 9M FY22 9M FY232 Rs bn 26.5% New business Margin 25.9% 26.1% 27.4% 26.5% Value of new business 19.2 21.9 26.8 17.8 21.6 Profit after tax (PAT) 13.0 13.6 12.1 8.5 10.0 Underwriting profits 10.9 7.3 4.41 2.41 5.5 Shareholders' surplus 2.1 6.3 7.7 6.1 4.5 29.9 32.3 34.9 30.4 23.3 Underwriting profits breakup -19.1 -20.9 -25.0 -24.9 -30.5 FY20 FY21 1. Post accounting for impact of excess mortality reserve (EMR) 19 2. Current year numbers are on a merged basis, hence prior years are not comparable FY22 9M FY22 9M FY23 ■Backbook Surplus ■New Business Strain Profitable distribution Diversified leading Market- growth insurance Reimagining Quality of Board and mix innovation management HDFC Life#10Analysis of change in IEV EVOP 42.3 EVOP1% 17.5% 21.6 19.6 329.6 VNB 1.1 Operating variances 11.6 16.7 Economic variances Dividend & Unwind Capital infusion 228.3 101.3 Adjusted Net worth (ANW) Value of in-force business (VIF) IEV As at Mar 31, 20222 Operating variance continues to be positive and in line with our assumptions 10 1. EVOP% calculated as annualised EVOP (Embedded Value Operating Profit) to Opening EV 2. Opening IEV as at Mar 31,2022 includes Exide Life EV, hence it is comparable to IEV as at Dec 31,2022 377.0 251.6 Rs bn 125.5 IEV As at Dec 31, 2022 growth Profitable Diversified distribution mix innovation leading Market- insurance Reimagining management Board and Quality of HDFC Life#11Diversified distribution mix enabled by multiple levers Proprietary¹ Banks, SFBs, Other CAs 1.5L+ Agents 500+Branches 48 Digital Branches² HDFC BANK Saraswat Bank The Sarel Coperative Bork LM. (ADcheduled Bark) Bandhan Bank IDFC FIRST Bank RBL BANK S Union Bank AXIS BANK of AU AU SMALL FINANCE BANK Utkarsh Small Finance Bank Aapki Ummeed Ka Khaata SOUTH INDIAN Bank NBFCs, MFIS HDFC SALES HDB FINANCIAL SERVICES TATA CAPITAL Fullerton India Chola Brokers & Aggregators BLUECHIP EXPERT ADVICE. EASY INVESTING 1 Integrated policy bazaar Coverfox.com Compare. Buy. Save. since 1974 Investments Simplified com CAPITAL INDIA W SIRVAD BajajCapital इंडिया पोस्ट पेमेन्ट्स बैंक Payments Bank India Post Finance Limited SURYODAY A BANK OF SMILES www.hdfclife.com HDFC Life App YES BANK DCB BANK UJJIVAN ULLIVAN SMALL FINANCE BANK IIFL HOME LOAN FIVE STAR HeroFinCorp. Muthoot BAJAJ FINANCE LIMITED MICROFIN pnb Housing Ni INSURANCE BROKERS D Capital Small Finance Bank TJSB SAHAKARI BANK LTD. BULED BOAR TATA Motorsfinance InsuranceDekho Probus Insurance ROBINHOOL INSURANCE BROKER- KNOWLEDGE ON YOUR STOE C-NTRUM MULTI-STATE driven by trust naboline Group, Pension & International 不 11 Business NPS Corporates Partnerships in emerging eco-systems across Health, E-commerce, Auto, Telecom, Mutual Fund, Fintech Fin Mapp fisdom Z zopper MyLoanCare.in Baat Aapke Interest Ki Group Annuity (MPH/CA) पे AXIS ASSET MANAGEMENT 160+ Superannuation Funds LENDINGKAT PhonePe realme payसा mswipe.M turtlemint FUNDSINDIA Rep Office NRI 1. Proprietary channels include Agency, Direct and Online (Post-Merger basis) 2. Digital Branches: Virtual branch for servicing customer requests remotely through dedicated app and webpage Equity Brokers & Wealth A ICICI Securities HDFC securities sbi securities MOTILAL OSWAL Edelweiss Ideas create, values protect Investment Services NZERODHA GEOJIT Profitable growth distribution Diversified leading Market- Reimagining Quality of Board and insurance mix innovation management Angel Broking HDFC Life#12Bancassurance powered by innovation, technology and people + 12 Product proposition Comprehensive product suite across par, non-par, term, annuity, ULIP Combo insurance products Innovative term products limited pay, RoP1 and riders Mass distribution products POS¹ & - Saral plans Partner experience & engagement Defined engagement metrics InstaPlan measured digitally +x Tech & Digitization Insta Quote One stop solution for generating illustration PASA¹ using analytics Distribution Strong presence across metro, urban & rural geographies with ~9K Sales force Strong growth & presence in alternate channels viz virtual, salary & HNI; focus on Capability building & resourcing Learning on the go: mobile nugget$ for skill enhancement Comprehensive YOUNite engagement and training programs for sales teams CSR Joint CSR1 INSTAInsure COPPORATE initiatives that RESPONSERITY strengthen relationships Dedicated HNI¹ cell Cloud Cloud based customer Telephony calling solution for sales Reducing need of physical presence by E2E digital processes MSME sector Strong YoY growth in group insurance through credit protect Increasing business pie through POS Structured rewards and recognition program Gamified learning experience through mobile app & simulations Innovative retirement products through Virtual InstA assistant for sales & service teams P-conversion Verification via Chat annuity & pension 1. 1 2 3 2. Digital sales verification via WhatsApp chat, video app or calling products attached in assets POS: Point of Sales; PASA: Pre-approved Sum Assured; RoP: Return of Premium; HNI: High Networth Individual; CSR: Corporate Social Responsibility WISE: Frontline digital tool, enables virtual onboarding of customers in the presence of a HDFC Life representative 3. PCVC: Pre Conversion Verification Call Profitable growth distribution Diversified mix innovation leading Market- Reimagining Quality of insurance Board and management HDFC Life#13Balanced product mix in Agency enabled by technology and training BUZZ Secure communication platform for all agency stakeholders Contest launch, updates, qualification, reward fulfillment process and status FAME AI & ML based customer interactions and opportunities Theme based dossier focused on giving consumer insights Receive nudges to improve customer reach out The Selling Skills Program In-depth program to train and groom our FLS on essential selling skills Agency Life Skilling and engagement platform to drive higher productivity Analytics based distribution & activation drives & enablers Technology 30 Medi Easy Term Digital tool for smooth on-boarding of term customers 13 Easy to fill forms and pay premiums . • ALA Agency Training Partner Portal Check performance reports & commissions Trigger customer communication and reminders MIS, ranking, contest earnings, opportunities and much more IC38 Audio Online Training L Easier and simpler way to complete IC38 training ✓ Available in vernacular language ✓ Interesting & engaging audio content Sales Planning Simulation First of its kind, unique sales planning simulation for branch heads enabling them to learn and practice effective sales planning in a simulated environment Profitable distribution Diversified growth leading Market- Reimagining Quality of Board and insurance mix innovation management HDFC Life#1450+ years Risks Addressed Asset Drawdown Addressing customer needs at every stage of life <25 years 25-35 years Objective Simple Savings Borrowing 36-50 years Investments Pay off mortgage Needs First Job Medical care Get married Plan for retirement Medical care Medical care Buy new car Child's education Buy Home Product Offerings Product mix across age categories¹ Medical care Retire Mortality Morbidity Net Worth Longevity Interest Rate Profitable distribution Diversified leading Market- Quality of growth insurance Reimagining mix innovation management Board and UL 26% 25% 22% 16% Par 41% 31% 27% 29% Non par 30% 36% 44% 36% savings Protection 3% 8% 5% 1% HDFC Annuity 0% 0% 2% 18% Life 14 1. Based on Individual APE for 9M FY23; Percentages may not add up due to rounding off effect.#15Our approach to retiral solutions 1. NPS R _ Largest Pension Fund Manager (PFM) in Retail and Corporate NPS segment, with AUM of Rs 399 bn¹ Registered strong YoY growth of 63% in AUM 2. Immediate / deferred annuity Largest player in the private sector ☐ Market share grew from 36.5% in Dec'21 to 40.2% in Dec'22 amongst all PFMs Company has ~1.4 mn PFM customers #2 POP2 in Corporate Subscriber business 3. Group superannuation fund Managing funds for 160+ corporates under superannuation scheme 1. 2. 15 NPS AUM Ranked #1 Doubled in less based on AUM than 17 months 63% Annuity portfolio CAGR: 44% Rs bn Profitable distribution Diversified growth mix innovation leading Market- insurance Reimagining Quality of Board and management 211 399 164 284 52 116 164 54 FY19 FY21 FY22 9M FY23 FY19 FY21 FY22 9M FY23 YoY growth HDFC As on Dec 31, 2022 POP: Point of presence for enabling opening of accounts on a platform Life#16Protection Direct Banca 2 Product mix across key channels¹ Segment FY20 FY21 FY22 9M FY23 Segment FY20 FY21 FY22 9M FY23 UL 32% 27% 29% 26% ¡UL 12% 10% 16% 11% I I Par 18% 37% 33% 28% I Par 34% 37% 33% 37% Non par savings 44% 30% 33% 38% I Non par savings 40% 39% 39% 42% Term 4% 4% 4% 3% Term 12% 11% 10% 7% | I Annuity 2% 2% 2% 4% Annuity 3% 3% 3% 3% ¡UL 33% 29% 28% 20% UL 44% 39% 46% 55% ¡Par 14% 17% 14% 17% I Par 1% 1% 2% 2% I Non par savings 20% 16% 27% 32% I Non par savings 18% 29% 30% 30% ¡Term 4% 3% 3% 3% Term 37% 30% 20% 10% I I I !Annuity 29% 35% 28% 28% Annuity 1% 2% 2% 3% Segment FY20 FY21 FY22 9M FY23 Company UL 28% 24% 26% 21% Par 19% 34% 30% 29% Non par savings 41% 31% 33% 39% 38% of business with policy term <=10 years; 14% of received premium in single-pay policies for 9M FY23 Term 8% 7% 6% 4% Annuity 4% 5% 5% 6% FY20 FY21 FY22 9M FY23 !Based on Total APE 17% 13% 14% 15% Based on NBP 27% 20% 24% 30% 3. Includes business sourced through own website and web aggregators 16 Annuity 1. Based on Individual APE, Term includes health business. Percentages are rounded off. Current year numbers are on a merged basis, hence prior years are not comparable 2. Includes banks, other corporate agents and online business sourced through banks / corporate agents FY20 FY21 FY22 9M FY23 I Based on Total APE 4% 5% 5% 8% I Based on NBP 16% 20% 20% 24% Profitable distribution Diversified growth mix innovation leading Market- Quality of insurance Reimagining management Board and HDFC Life#17Aligned to make life simpler for customers 17 17 1 Accelerate JOURNEY SIMPLIFICATION across channels Fast track PARTNER INTEGRATION 2 3 SERVICE SIMPLIFICATION for connect and personalization DATA LABS ECOSYSTEM for decision making 4 Building resilience.. 8 Enable a hybrid Work From Home environment 6 7 Connecting with startups through Create a digital scalable efficient Futurance¹ Architecture 1. Futurance: A program to collaborate with startups for harnessing cutting-edge technology 5 PLATFORMS independent buying / servicing 6 growth Profitable mix distribution Diversified innovation leading Market- Quality of insurance Reimagining Board and management Strengthen Cyber Security for post-Covid world HDFC Life#18Partnering with Start-ups to innovate Futurance>>> 18 An industry first start-up connect program launched in June 2019, now in its 5th phase. Futurance program has witnessed over 450 applications 20+ Start-ups shortlisted till date to connect with HDFC Life's Senior leadership. 10+ Start-ups selected for Proof of Concept Live use cases: Alternate & augmented data, Medical/ health tech, innovative sales tech, vision & voice AI based solutions Profitable growth mix distribution Diversified innovation leading Market- insurance Reimagining Quality of management Board and HDFC Life#19New in-house automated underwriting rule engine Developed in-house automated rule engine to replace existing externally sourced rule engine Benefits 19 DEPENDENCY Complete control - No dependencies on external rule engine service provider Rλ КУ Highly efficient, scalable & reliable API Integration of APIs and third party services to improve decision making ili! *STP: Straight throughput Substantial cost saving: License fee, amendment fee and maintenance fee ~70% customer applications auto underwritten leading to improvement in STP* rate and additional risk identification growth Profitable mix distribution Diversified innovation leading Market- insurance Reimagining Quality of management Board and HDFC Life#20Journey Simplification Credit Bureau, ITR & EPFO Integration aiding better throughput Empowering a seamless customer onboarding journey Benefits Hassle free customer onboarding experience Proposal Submission ☐ Bureau is triggered for ☐ the estimated income Option for digital authentication available for ITR ping. Option for EPFO trigger available for the customer L Bureau/ITR/EPFO output fetched through API Value received is passed to UW rule engine ITR documents for latest" 3 financial years fetched PF passbook fetch through EPFO I. Financial UW by Rule Engine Enhanced risk assessment for underwriting Financial viability is verified and for eligible case no additional requirement is raisied Aversion of risk related to fraudulent documents Reduced cancellation due to unavailability of financials with customer Improvement in overall issuance TAT 20 20 Continued improvement in throughput and issuance TATS Profitable growth mix distribution Diversified innovation leading Market- insurance Reimagining Quality of management Board and HDFC Life#21Strengthening underwriting and simplifying customer journey Cardiac risk assessment (CRA) at home for medical underwriting Convenience to individuals who have to undergo medicals while applying for an HDFC Life insurance policy Home medicals for NRI customers MULTI-FUNCTIONAL SCREEN TRIANGULAR REGULATOR JOYFIT BOLD SENTS MASSAGE FOOT PEDAL JOYFIT HYDRAULIC GAS ROD RUBBER SLEEVE PLUG Canada USA Austria Belgium Denmark UK Hungary Germany Switzerland Netherlands France Israel Greece Dubai Oman St.Thomas Mexico 오 오 Grand Cayman St.Croix Singapore Australia Applicants / users step on a stepper with speed & resistance adjustments ■ Conventional print based ECG equipment is replaced with a portable, bluetooth and mobile connected ECG equipment for real time data recording and analysis Recording is transmitted to the remote physician for review and interpretation Instead of an onsite physician, an online consultant physician is available to monitor the progress of the stress test (incl. real-time ECG) over a video call The physician can talk to the site technician and the applicant/ user for any instructions This service is currently live in 22 locations In an industry first initiative, we have now launched home medicals for our customers overseas in 21 countries 21 Profitable growth mix distribution Diversified innovation leading Market- insurance Reimagining Quality of management Board and HDFC Life#22Governance framework Board Committees Management Committees/Councils 22 Board of Directors Independent and experienced Board Audit Committee Risk Management Committee Policyholder Investment Committee Protection Committee Nomination & Remuneration Committee Corporate Social Responsibility Committee Stakeholders' Relationship Committee With Profits Committee Whistleblower Committee Investment Council Claims Review Risk Management Committee Compliance Council Council ALCO1 Grievance Credit Council Management Committee Information & Cyber Security Council Disciplinary Panel for Malpractices Prevention of Sexual Harassment Board Approved Committee Product Management Committee Outsourcing Committee Product Council Standalone councils Business and Innovation Technology Council Persistency Council Additional governance through Internal, Concurrent and Statutory auditors Note: 1. Asset Liability Management Council 2. The above list of committees is illustrative and not exhaustive Capital Raising Committee Profitable growth mix distribution Diversified innovation leading Market- Quality of .. insurance Reimagining Board and Management HDFC Life#23Financial risk management framework Natural hedges Protection and longevity businesses Unit linked and non par savings products ALM approach Target cash flow matching for non par savings plus group protection portfolio to manage non parallel shifts and convexity ■ Immunise overall portfolio to manage parallel shifts in yield curve (duration matching) Managing Risk Product design & mix monitoring ■ Prudent assumptions and pricing approach Return of premium annuity products (>95% of annuity); Average age at entry ~59 years ■ Deferred as % of total annuity business < 30% with average deferment period <4 yrs ☐ Regular monitoring of interest rates and business mix Residual strategy External hedging instruments such as FRAS, IRFS, swaps amongst others Reinsurance FY22 9M FY23* I Sensitivity Overall Non par 1 Overall Non par 1 Sensitivity remains range-bound on the back of calibrated risk management Scenario EV Interest Rate +1% Interest Rate -1% VNB Margin (2.0%) (1.4%) (2.1%) 1.6% 0.8% EV EV 1.4% 1.5% VNB VNB VNB Margin Margin Margin (2.5%) (2.4%) (1.5%) (2.1%) (2.3%) 2.0% 0.7% 1.3% 0.9% EV 1. Comprises Non par savings (incl Annuity) plus Protection HDFC Life * 23 Current year numbers are on a merged basis, hence prior year is not comparable#24Agenda 1 Performance Snapshot 2 Our Strategy 3 Our approach to ESG 4 Annexures 5 Life insurance in India HOM#25ESG at a Glance 25 Ethical Conduct & Governance ETHICS ESG Focus Areas Responsible Investment Diversity, Equity and Inclusion (DE&I) Holistic Living Sustainable Operations ESG Score Highlight: Highest rated Indian insurance company in the ESG assessment by S&P Global HDFC Life#26Ethical Conduct & Governance ESG Management Committee, led by the Chief Financial Officer oversees the policy implementation and operational controls for environmental risks including Climate change The overall accountability for the ESG issues lies with the CSR Committee of the Board • Performance Management based on the principles of Balanced Scorecard; covers the Organization's performance on financial, market / customer, people, sustainability and operational aspects. 26 Governance Structure Board Composition · Five Independent Directors • Three Non-Executive Non-Independent Directors Board Diversity STANDARDS COMPLIANCE • 30% women as on 31st December, 2022 POLICIES REGULATIONS RULES 0 Remuneration Policy • • Seeks to balance the fixed and incentive pay ESOPS based on the recommendations of NRC Clawback & Malus provision Risk Management • • • • • Risk oversight by Senior Management & Board of Directors vide Risk Management Council and Risk Management Committee respectively Modes of Risk Awareness Trainings, E-mailers, Seminars, Conferences, Quizzes and Special awareness Drives Business Continuity Management (BCM)-Recovery plan for critical business activities in place Enterprise Risk Management (ERM) framework o 'Three Lines of Defence approach' o Reviewed and approved by the Board ESG risks including Climate change, etc. included under Emerging risks category of the ERM Framework HDFC Life#27Ethical Conduct & Governance (contd.) Information / Cybersecurity . . • • Risk oversight by Board Risk Management Committee and risks reporting done on a quarterly basis • Modes of Risk Awareness Annual mandatory training for all employees Security workshops and case study discussions Specially curated programs and sessions for senior leadership Monthly awareness mailers Policies and Frameworks • • . Anti-bribery & Anti-corruption Policy Anti Money Laundering (AML) Policy Board Diversity Policy Code of Conduct Corporate Governance Policy • Data Privacy Policy • • • Investor Grievance Policy Responsible Investment (RI) Policy Stewardship Policy • Tax Policy Whistleblower Policy Corporate Social Responsibility (CSR) Policy о о Security posters and leaflets O Phishing Simulation Campaigns Dedicated helpdesk and email id's for reporting on the breaches • Certifications & Frameworks - ISO 27001 standards National Institute of Standards and Technology (NIST) О Federal Financial Institutions Examination Council (FFIEC) based Cyber Security Framework for Risk Assessment • Diversity, Equity and Inclusion (DEI) Policy • Human Rights Policy • • COMPLIANCE 8 Do Policy for Prevention and Redressal of Sexual Harassment (PRSH) Supplier Code of Conduct • Environment and Climate Change Policy* * Environment and Climate Change Policy to be uploaded on company web-page post approval by the Board CSR Committee 27 27 STOP HDFC Life#28Responsible Investment Responsible Investment Policy Objective To generate optimal risk adjusted returns over the long term RI framework RI and stewardship policy in place Applicable to all major asset classes Head of Research ensures that ESG is incorporated into overall Research and Investment process ESG issues covered in voting process Sustainable Equity Fund What is Sustainable Equity fund & why invest in it? This fund shall seek to generate returns from investing in companies with high ESG standards and commensurate score, create value for all stakeholders with lower risks & generate sustainable long-term returns. Actuarial Financial ESG Bolstering commitment towards Responsible Investment Became signatory to United Nations supported Principles for Responsible Investment (UN-PRI) PRI Principles for Responsible Investment Responsible Investment Governance A ESG Governance Committee at the investment team level comprises of Chief Investment Officer, Head of Fixed Income, Head of Research, Fund Manager of ESG Fund and dedicated ESG research analyst Exclusion criteria included in the RI Policy Companies engaged in the business of tobacco, alcohol, controversial weapons and gambling shall be excluded from the Sustainable Equity Fund Exclusion criteria aligned with the exclusion policy followed by Nifty 100 ESG Index 28 HDFC Life#29Employee diversity, equity & inclusion Employee Engagement & Diversity, Equity and Inclusion (DEI) Special Recognition Great Places to Work 39th amongst о top 100 Best Places - о Best workplaces for Women 2021- Great Place to Work Institute Promoting DEI ally ship: leadership development, communication, Actuarial Financial ESG о о о о О о о о Avtar top 100 Places О Best Workplaces for Women 2021 Economic Times 10 ΤΟ I Brandon Hall awards - Learning Strategy, Simulation training, & Social Talent Acquisition Attracting talent Hybrid work model and flexi hours to attract gig workers Robust employee referral schemes (>50%) Hire-train-deploy model through tie-up with reputed learning institutions HR tech: in-house application tracking system Training & development Career coaching and development interventions; woman mentoring Mobile learning app for self-paced learning Training for all including employees, contractors, channel partners / Virtual product training O Skill Up: Curated online training programs from reputed universities о Average hours per FTE of training and development: 86 hours I O о Employee engagement Emotional and well being assistance program for employees and their families Doctor on Call: Unlimited free consultation E-Sparsh: Online query & grievance platform Family integration programs Platform for employee engagement: CEO Speaks, HDFC Life Got Talent, e-appreciation cards In-house fitness and wellness app Click2Wellness - Leaders and expert sessions to create awareness on various topics of inclusion Talent management/retention Special programs for campus hires; Talent development interventions for leadership Career microsite, job portal Internal Career Fair for employees Long term incentive plans in the form of ESOPs¹ and cash to attract, retain and motivate good talent Elaborate succession planning for Key Managerial Personnel, critical senior roles Managers Transformation League - Leadership development program for middle management New Manager Boot Camp - Development program! for First Time Managers о о strengthening policies, aligning workforce through Celebrate YOU program of the Company 26% women employees Celebrate YOU Promoting diverse talent pool (work profiles for second career women, specially-abled) - #MyJobMyRules Launched official DEI page on our website highlighting various initiatives Gender transition surgery covered under mediclaim policy Gender neutral Dress code policy Maternity policy Use of terms like primary and secondary caregiver instead of using terms like parents, mother/father, man/woman 1. ESOPS: Employee Stock Options 29 HDFC Life#3030 30 Holistic Living: Inclusive Growth FY22 Sector-wise budget break-up 3% Customer Highlights Claim settlement ratio (individual & group) 99.6% Customer Satisfaction Score for March'22 88.9 % Persistency ratio (13th month) 87% (excluding single premium and fully paid up policies) COVID claims (net) Rs. 818 crore, Count 15,293 CSR Numbers Number of lives covered 5.4 crore Rural sector 1,89,147 Social sector 1,00,87,909 MFI lives covered under CP 3,14,55,858 States and UT's covered 23 21% 24% 52% ■ Education and Livelihood ■ Health care and Sanitation ■ Environmental Sustainability ■ Others Sustainable Development Goals covered 12 CSR Spends Rs. 17.4 crore CSR beneficiaries* 4.6 lakh *CSR beneficiaries include 1.60 lakh beneficiaries impacted in completed projects and 3.07 lakh beneficiaries from on-going projects HDFC Life#31Holistic Living: Delivering superior customer experience Customer Centricity 31 1. Journey simplification - frictionless sales and service Simplifying buying journeys through platforms like LifeEasy (online term purchase) Document simplification & elimination Contactless services- new normal OCR: Optical Character Recognition 0 Online claim processing for eligible customers via EasyClaims platform OCR: Enabling digital document submission and verification Straight through processing of maturity payouts for verified accounts Leveraging advanced technologies for personalization and better customer experience (CX) NEO - Cognitive bots policy queries answered within 2-3 clicks Personalization - Pre-approved sum assured for customers based on risk profile Digital Life Certificate for collecting survival proof from senior citizens Contactless branches by leveraging face recognition technology Customer Satisfaction Score (%) as on 30th September 2022 - 91.3 Actuarial Financial ESG HDFC Life#32Sustainable Operations Actuarial Financial ESG Energy and water 。 Since 2014 only 3 or 5 star rating air - conditioners used 。 94% of branches use LED based lighting system 。 Use of sensor based urinals and water taps o Total purchase of energy from renewable sources: 2,39,788 kWh during FY 2021-22 。 25 new water purifiers installed in FY 2021-22 to replace bottled drinking water De-carbonization roadmap and way forward Key initiatives & action points for FY23: 。 TCFD (Task Force on Climate-Related Financial Disclosures) 。 SBTI (Science Based Targets initiative) 。 Carbon neutrality strategy & roadmap Digitization - Reduction of Paper Usage О О Introduction of E-business cards & ID cards Online/e-forms for customers О Annual report FY20, FY21 and FY22 digitally communicated O Demat i.e. digital policy accounts for 38% of our new business Bio-diversity 。 11 city forests created using Miyawaki method; 69,603 trees planted in total (27 city forests in total till date) GHG inventory o Scope 1 emissions CO2e o Scope 2 emissions CO2e o Scope 3 emissions CO2e - - 63 met. ton. 10,135 met. ton. 746 met. ton. о Waste management RECYCLE REUSE REDUCE 25,850 Kgs of e-waste recycled/ refurbished/disposed in FY22 О 301.5 Kg of paper cups & paper disposed for recycling FY 2021-22 о No single-use plastics ☐ Bio-degradable garbage bags Cafeteria with reusable plates, cutlery, wooden stirrers etc. Procurement of plastic water bottles discontinued at Pan-India locations |32 ◉ HDFC Life#33Agenda 1 Performance Snapshot 2 Our Strategy 3 Our approach to ESG 4 Annexures 5 Life insurance in India HOM#34Persistency trends for HDFC Life¹ Across key channels (%) 88 78 71 Agency 22 62 55 Across key segments (%) 89 80 73 34 60 60 55 Savings (Traditional) 86 76 70 65 53 90 00 83 لله 73 64 49 Banca Direct ■13th month 25th month 37th month 49th month 61st month 81 69 66 99 Savings (UL) 99 66 48 56 CY (9M FY23) 88 87 78 71 64 Company PY (9M FY22) 93 86 87 79 76 77 71 67 40 Protection ■13th month ■25th month ■37th month ■49th month ■61st month 1. For individual business; Excluding single premium and fully paid up policies. Current year numbers are on a merged basis, hence prior year is not comparable Company 52 62 63 53 HDFC Life#35Improving VNB trajectory for both existing and acquired businesses 17.8 2.0 1.5 3.9 0.6 1 21.6 9M FY22 Impact of higher APE Change in assumptions New Business Profile Fixed cost absorption 9M FY23* NBM% 26.5% 0.0% -0.7% 2.5% -1.8% 26.5% 35 1. * Reflects the impact of difference in mix of segment/distribution channel/tenure/age/sum assured multiple etc Current year numbers are on a merged basis, hence prior year is not comparable VNB - Value of New Business; NBM - New Business Margin Rs bn Actuarial Financial ESG HDFC Life#36Sensitivity analysis - H1 FY23 (Pre-Merger basis) Analysis based on key metrics Scenario Change in Change in VNB Margin 1 % Change in EV Increase by 1% -1.4% -2.3% Reference rate Decrease by 1% 0.7% 1.9% Equity Market movement Decrease by 10% -0.2% -1.4% Increase by 10% -0.5% -0.4% Persistency (Lapse rates) Decrease by 10% 0.5% 0.4% Increase by 10% -0.5% -0.8% Maintenance expenses Decrease by 10% 0.5% 0.8% Acquisition Expenses Increase by 10% -4.2% ΝΑ Decrease by 10% 4.2% ΝΑ Increase by 5% -1.5% -1.0% Mortality/Morbidity Tax rate² Decrease by 5% 1.5% 1.0% Increased to 25% -5.0% -8.4% 36 1. Post overrun total VNB for Individual and Group business 2. The tax rate is assumed to increase from 14.56% to 25% and hence all the currently taxed profits in policyholder/shareholder segments are taxed at a higher rate. It does not allow for the benefit of policyholder surplus being tax-exempt as was envisaged in the DTC Bill. HDFC Life#37Capital position 201% 184% 176% 209% 142.5 40.0 94.3 97.7 14.3 34.2 70.8 24.0 27.8 13.1 23.4 19.2 38.5 46.9 Mar 31, 2020 Mar 31, 2021 ASM1 RSM @100% Incremental RSM @150% Successfully raised Rs 20 billion of equity share capital in current year 1. ASM represents Available solvency margin and RSM represents Required solvency margin 137 55.6 68.3 Mar 31, 2022 Dec 31, 2022 Surplus Capital Solvency margin Rs bn HDFC Life#38Assets under management* Debt: Equity 62:38 71:29 64:36 68:32 UL:Traditional 50:50 43:57 43:57 35:65 1% 37% 17% 2,338 2,042 1,738 1,272 Mar 31, 2020 Mar 31, 2021 Mar 31, 2022 Dec 31, 2022 YoY Growth ~99% of debt investments in Government bonds and AAA rated securities as on December 31, 2022 * Current year numbers are on a merged basis, hence prior years are not comparable 38 Rs bn Actuarial Financial ESG HDFC Life#39Agenda 1 Performance Snapshot 2 Our Strategy 3 Our approach to ESG 4 Annexures 5 Life insurance in India HOM#4040 40 2020 69.3 2040 Hong Kong Taiwan 19.2% 14.0% 7.6% 5.8% Singapore Japan Malaysia 4.0% 3.4% 3.2% 8,433 Growth opportunity: Under-penetration and favorable demographics 1 Life Insurance penetration ¹ (FY 2022) Life Insurance density US$ 2 (FY 2022) Life expectancy (Years) Thailand India China 2.4% Hong Kong Singapore 5,414 3,772 Taiwan Japan 2,347 444 246 253 69 Malaysia 1.4 1.6 1.7 76.1 7% 11% 17% 73.1 2060 Population composition (bn) 58% 61% 60% 1. Penetration as measured by premiums as % of GDP, 2. Density defined as the ratio of premium underwritten in a given year to the total population Source: Swiss Re (Based on respective financial year of the countries), MOSPI, United Nations World Populations Prospects Report (2017) 35% 28% 23% 2020 2040 2060 Less than 20 years 20-64 years ■65 years and above Thailand China India India remains vastly under-insured, both in terms of penetration and density Huge opportunity to penetrate the underserviced segments, with evolution of the life insurance distribution model India's insurable population estimated to be at 1 bn by 2035 Emergence of nuclear families and advancement in healthcare facilities lead to increase in life expectancy thus facilitating need for pension and protection based products HDFC Life#41Low levels of penetration Life protection - 172 mn 68 mn 1.7 mn Protection gap 2 (2019) 83.0% 76.0% 74.0% 71.0% 70.0% 61.0% 55.0% 55.0% 54.0% 41.0% India Indonesia Malaysia Urban Working Population Addressable Market Annual Policy Sales (excl blue collared) Only 1 out of 40 people (2.5%) who can afford it, is buying a policy every year¹ 24 17 Even within the current set, Sum Assured as a multiple of Income is <1x 12 3. Kotak institutional equities 41 1. Goldman Sachs Report, March 2019 2. Swiss Re (Based on respective financial year of the countries) Thailand China Japan Singapore South Korea Trend of retail loans 3 (Rs Tn.) 34 FY12 FY14 FY16 FY18 FY20 FY22 53 44 Australia Hong Kong ■ India has the highest protection gap in the region, as growth in savings and life insurance coverage has lagged behind economic and wage growth ■ Protection gap growth rate is predicted to grow at 4% per annum Retail credit has grown at a CAGR of 16% over last 10 years Increasing retail indebtedness to spur need for credit life products Immense opportunity given: Increasing adoption of credit Enhancement of attachment rates Improvement in value penetration Widening lines of businesses HDFC Life#42Macro opportunity - Retiral solutions 222 42 India's pension market is under-penetrated at 3%* of GDP 98.3 90.1 54.0 31.3 3.0 India Japan Hong Kong Canada USA 146.2 Australia Improvements in life expectancy will lead to an average post retirement period of 20 years Life expectancy at age 60 20 19 18 18 17 17 16 15 1995-2000 2005-10 2015-20 2030-35E ■Males Females Elderly population is expected to almost triple by 2060 1% Ageing population 11% 17% 67% 68% 66% Average household size has decreased from 4.6 in 2001 to 3.9 in 2018 Total Pension AUM is expected to grow to Rs 118 Tn by 2030 (about 1/4th accounted by NPS) Mandatory schemes to increase coverage for both unorganized and organized sectors 26% 21% 17% 2020 2040 2060 ■Age <15 Yrs Age 15-64 Yrs Age >64 Yrs Source: OECD 2021, Milliman Asia Retirement Report 2017; Survey by NSSO, Ministry of statistics and Programme implementation Crisil PFRDA, Census of India, UN Population Estimates * Comprising pension assets / funds HDFC Life#4343 33 Macro opportunity - Rising Middle Income Population Household Distribution by Income in India Sum Assured as a % of GDP 332% 385 256 286 321 1% 2% 3% 9% 16% 21% 32% 47% 252% 251% 153% 143% 127% 83% 76% 65% 44% 85% 62% FY12 E FY17 E FY22 E FY30 P Singapore Japan USA Malaysia Thailand South Korea 23% India < Rs 0.2 mn - Rs 0.2 1 mn ■> Rs 1 mn Number of Households (In mn) Embedded SA Protection SA Number of middle income households is expected to almost double to 181 mn between FY22 and FY30 High proportion of this increase is expected to come from semi-urban and rural India ■This is evidenced by increase in bank deposits from outside "top 200 districts" from 25% in March'15 to 30% in March'21 India has the lowest sum assured (SA) as a % of GDP amongst its peers Rising middle income, increasing financial literacy and limited life cover represents an opportunity for protection growth in life insurance Source: CRISIL "The big shift in financialisation" report 2022; Jefferies "Composite Insurance License in India: Taking a Leaf from Global Experience" report 2022 Note: E Estimated, P - Projected, HDFC Life#44Government bond auctions Government Bonds - Tenorwise Issuance 100% 90% 80% 70% 62% 65% 65% 65% 71% 73% 72% 73% 60% 79% 50% 40% 30% 20% 35% 38% 35% 35% 29% 27% 28% 27% 10% 21% 0% FY15 FY16 FY17 FY18 FY19 FY20 FY21 ■ <=15yrs 3,86,000 3,66,500 3,73,525 4,97,579 3,82,941 4,44,000 10,01,835 FY22 8,48,000 9M FY23 8,32,000 ■>15yrs 2,06,000 2,25,000 1,54,520 1,80,529 2,04,000 2,38,000 2,65,575 3,31,000 3,29,000 Total 5,92,000 5,91,500 5,28,045 6,78,109 5,86,941 6,82,000 12,67,410 11,79,000 11,61,000 Auction of >15 year maturity bonds has been ~25-30% on an average facilitates writing annuity business at scale Source: CCIL & National Statistics Office, Union Budget, RBI 44 Rs cr HDFC Life#45Life Insurance: A preferred savings instrument Household savings composition Financial savings mix 22% 18% 20% 22% 3% 8% 12% 15% 22% 19% 18% 19% 47% 17% 23% 68% 65% 60% 17% 17% 32% FY13 40% 35% 67% 56% 50% 53% 38% FY16 FY19 FY21 ■Financial savings ■Physical savings Household savings as % of GDP FY13 FY16 ■Currency & deposits Life insurance Increasing preference towards financial savings with increasing financial literacy within the population Various government initiatives to promote financial inclusion: Implementation of JAM trinity Launch of affordable PMJJBY and PMSBY social insurance schemes Atal Pension Yojana promoting pension in unorganized sector Source: DBIE-RBI Statistics, RBI Annual Report, Economic Survey, CSO, www.pmjdy.gov.in 45 FY19 FY22 ■Provident/Pension fund ■ Others HDFC Life#46Industry new business trends¹ Sensex ■ Private Players ■LIC Individual WRP in Rs bn 551 452 420 401 357 304 315 325 305 292 285 287 291 273 278 262 245 230 20008 227214 175 178 172 288 434 233 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 9M FY23 Sensex Private players Market share 52% 46% 37% 38% 38% 49% 52% 54% 56% 58% 57% 60% 63% 65% Growth % Private 7% -20% -24% 2% -3% 16% 14% 26% 24% 12% 5% 8% 22% 19% 29% 4% 11% -4% -2% -27% 3% 15% 13% 5% 8% -3% 7% 12% LIC 17% -9% -5% -2% -3% -11% 8% 21% 19% 9% 6% 3% 16% 16% Overall 46 46 ■ Private sector remained at higher market share than LIC FY16 onwards Amongst private insurers, insurers with a strong bancassurance platform continue to gain market share 1.Based on Individual Weighted Received Premium (WRP) Source: IRDAI and Life Insurance Council HDFC Life#47Private industry: Product and distribution mix 1 Product mix ¹ Unit Linked ■Conventional Distribution mix 2 ■Individual Agents Corporate Agents - Banks Corporate Agents - Others Brokers Direct Business 57% 54% 52% 51% 51% 48% 49% 49% 61% 60% 9% 10% 10% 12% 14% 16% 16% 15% 56% 3% 10% 20% 3% 3% 3% 20 3% 3% 3% 3% 3% 3% 3% 46% 43% 44% 39% 40% 47% 52% 54% 54% 55% 53% 55% 55% 36% 32% 30% 28% 25% 25% 23% 23% FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 ■ Product mix has recently moved towards conventional business for the private players with high focus on non-par savings, protection ■ Banca sourced business continues to dominate the channel mix on the back of increasing reach of banks along with increase in share of direct channel 47 47 1. Based on Overall WRP (Individual and Group); 2. Based on Individual New business premia for all private players Source: IRDAI and Life Insurance Council HDFC Life#48Appendix HDFC Life#49Financial and operational snapshot (1/2) 9M FY23* 9M FY22 FY22 FY21 FY20 CAGR Rs bn. New Business Premium (Indl. + Group) Renewal Premium (Indl. +Group) Total Premium Individual APE Overall APE 187.1 170.7 241.5 201.1 172.4 18% 191.9 144.7 218.1 184.8 154.7 19% 379.1 315.4 459.6 385.8 327.1 19% 68.7 55.8 81.7 71.2 61.4 15% 81.7 67.1 97.6 83.7 74.1 15% Group Premium (NB) 92.6 90.1 125.1 100.3 87.8 19% Profit after Tax 10.0 8.5 12.1 13.6 13.0 -4% -Policyholder Surplus 5.5 2.4 4.4 7.3 10.9 -36% - Shareholder Surplus 4.5 6.1 7.7 6.3 2.1 91% Dividend Paid 3.6 4.1 4.1 ΝΑ Assets Under Management 2,338 1,947 2,041.7 1,738.4 1,272.3 27% Indian Embedded Value 377.0 295.4 300.5 266.2 206.5 21% Net Worth (2) 126.0 90.5 154.0 84.3 69.9 48% NB (Individual and Group segment) lives insured (Mn.) 45.5 34.8 54.1 39.8 61.3 -6% No. of Individual Policies (NB) sold (In 000s) 701.3 639.3 915.3 982.0 896.3 1% 49 49 1. Comprises share capital, share premium and accumulated profits/(losses) * Current year numbers are on a merged basis, hence prior years are not comparable HDFC Life#50Financial and operational snapshot (2/2) 9M FY23* 9M FY22 FY22 FY21 FY20 Overall New Business Margins (post overrun) Operating Return on EV Operating Expenses / Total Premium 26.5% 26.5% 27.4% 26.1% 25.9% 17.5% 16.2% 16.6% 18.5% 18.1% 14.7% 12.2% 12.3% 12.0% 13.1% Total Expenses (Opex + Commission) / Total Premium 19.4% 16.3% 16.5% 16.4% 17.7% Return on Equity (1) 11.9% 13.0% 10.1% 17.6% 20.5% Solvency Ratio 209% 190% Persistency (13M / 61M) (2) 87%/52% 87%/53% 176% 87%/54% 201% 184% 85%/49% NA# Market Share (%) - Individual WRP - Group New Business - Total New Business Business Mix (%) 15.8% 15.2% 14.8% 15.5% 25.1% 28.3% 27.9% 27.6% 14.2% 29.0% 20.3% 21.7% 21.0% 21.5% 21.5% - Product (UL/Non par savings/Annuity/Non par protection/Par) (3) - Indl Distribution (CA/Agency/Broker/Direct) (4) - Total Distribution (CA/Agency/Broker/Direct/Group) (5) - Share of protection business (Basis Indl APE) - Share of protection business (Basis Overall APE) 13.8% 21/39/6/4/29 26/33/5/6/30 26/33/5/6/30 24/31/5/7/34 28/41/4/8/19 59/18/9/15 61/14/6/19 60/14/6/19 61/13/7/19 55/14/9/22 25/8/3/14/49 23/6/2/16/53 24/6/2/16/52 25/6/2/17/50 23/7/3/17/51 4.3% 6.3% 5.6% 6.8% 7.6% 14.8% 13.6% 12.8% 17.2% Share of protection business (Basis NBP) 30.4% 22.4% 24.0% 19.6% 27.6% 1. Calculated using net profit and average net worth for the period (Net worth comprises Share capital, Share premium and Accumulated profits). Opening networth for FY23 has been adjusted in line with the scheme of merger approved by the court 2. Individual persistency ratios (based on original premium) 3. Based on individual APE. UL: Unit Linked, Trad: Traditional, Par: Participating & CA: Corporate Agents. Percentages are rounded off 4. Based on total new business premium including group. Percentages are rounded off * Current year numbers are on a merged basis, hence prior years are not comparable 50 # Disclosures excluding single premium policies commenced from FY21 HDFC Life#51Revenue and Profit & Loss A/c Revenue A/C¹ 9M FY23* 9M FY22 Rs bn Profit and Loss A/c¹ 9M FY23 9M FY22 i Premium earned 379.1 315.4 I Income I I Reinsurance ceded (5.7) (4.4) I Interest and dividend income 4.8 3.7 Income from Investments 114.1 178.2 I Net profit/(loss) on sale 0.4 2.7 Other Income 1.7 0.9 I I | Transfer from Policyholders' Account 8.9 5.1 Transfer from Shareholders' Account 3.4 2.6! I Total Income 492.5 492.8 Other Income I Commissions 17.8 13.2 Total 14.1 11.5 I | Expenses 55.2 38.0 Outgoings I I GST on UL charges 2.8 2.7 Transfer to Policyholders' Account 3.4 2.6 I I ■ Provision for taxation (0.9) 0.3 ! Expenses 0.5 0.3' I i Provision for diminution in value of investments 0.2 (2.6) I I Interest on convertible debentures 0.5 0.3! I Benefits paid 263.0 211.0 I Provision for diminution in value of investments Change in valuation reserve 133.2 215.1 (0.2) (0.3)¦ I I Bonuses Paid 13.4 11.0 Provision for Taxation 0.0 0.1 Total Outgoings 484.7 488.9 Total 4.1 3.0 Surplus Transfer to Shareholders' Account Funds for future appropriation - Par Total Appropriations 1. Numbers may not add up due to rounding off effect 7.9 4.1 Profit for the year as per P&L Statement 10.0 8.5 8.9 5.1 (1.0) (1.0) 7.9 4.1 HDFC 51 Current year numbers are on a merged basis, hence prior years are not comparable Life#52Balance sheet 62 52 Dec 31, 2022¹ Dec 31, 2021 March 31, 2022 Rs bn Shareholders' funds Share capital (including Share premium) Accumulated profits Fair value change I Sub total Borrowings Policyholders' funds Fair value change Policy Liabilities 58.6 26.8 86.7i 67.4 63.7 67.3 1.0 1.4 127.0 91.9 0.8 154.8 9.5 6.0 6.0 25.0 25.3 21.7 1,351.2 998.6 1,043.4 Provision for Linked Liabilities 780.3 776.3 765.2 Funds for discontinued policies 40.5 43.0 41.0 Sub total 2197.0 1,843.2 I Funds for future appropriation (Par) 12.5 8.9 1,871.3 9.4 Total Source of funds 2,346.0 1,950.0 2,041.6 Shareholders' investment I 129.3 89.8 Policyholders' investments: Non-linked 1,388.3 1,038.3 152.4 1,083.1 Policyholders' investments: Linked 820.8 819.3 806.2 Loans 15.1 5.9 6.4 Fixed assets I Net current assets Total Application of funds 3.7 3.4 (11.2) (6.7) (10.0)| 2,346.0 1,950.0 2,041.6 1. Numbers may not add up due to rounding off effect. Current year numbers are on a merged basis, hence prior years are not comparable 3.4 HDFC Life#53Segment wise average term and age¹ Average Policy Term excluding annuity (Yrs) 9M FY23: 22.8 (9M FY22: 25.1) 12 UL 12 37 Par 41 17 Non-par Health 23 13 Non-par Savings 3. 12 Non-par Protection 33 38 Non-par Pension 14 13 3 9M FY23 9M FY22 Average Customer Age excluding annuity (Yrs) 9M FY23: 35.5 (9M FY22: 35.7) 37 UL 36 Par 33 33 33 32 Non-par Health 32 Non-par Savings Non-par Protection 33 44 37 34 33 87 38 Non-par Pension 34 53 56 9M FY23 9M FY22 Extensive product solutions catering customer needs across life cycles from young age to relatively older population 53 1. Basis individual new business policies (excluding annuity) HDFC Life#54Summary of Milliman report on our ALM approach - FY20 Scope of review Assess appropriateness of ALM strategy to manage interest rate risk in non-par savings business Review sensitivity of value of assets and liabilities to changes in assumptions Portfolios reviewed ■ Portfolio 1: Savings and Protection All non-single premium non-par savings contracts and group protection products ■ Portfolio 2: All immediate and deferred annuities Description Interest rate scenarios Interest rate + Demographic scenarios 100% persistency and low interest rates Stress scenarios tested Parallel shifts/ shape changes in yield curve within +- 150 bps of March 31st 2020 Gsec yield curve Interest rate variation + changes in future persistency/ mortality experience Net asset liability position Changes by < 4.5% Changes by 7% 100% persistency with interest rates falling to 4% p.a. for next 5 years, 2% p.a for years 6 -10 and 0% thereafter Still remains positive 54 54 Life Opinion and conclusion ALM strategy adopted for Portfolios 1 and 2 is appropriate to: ■ meet policyholder liability cash flows protect net asset-liability position thereby limiting impact on shareholder value HDFC 1. Opinion issued by Milliman Advisors LLP on ALM strategy (for non par business) based on FY20 disclosures#55Indian Embedded value: Methodology and Approach (1/2) Overview Indian Embedded Value (IEV) consists of: ☐ ☐ Adjusted Net Worth (ANW), consisting of: - - Free surplus (FS); - Required capital (RC); and Value of in-force covered business (VIF): Present value of the shareholders' interest in the earnings distributable from assets allocated to the covered business, after making sufficient allowance for the aggregate risks in the covered business. Components of Adjusted Net Worth (ANW) ☐ Free surplus (FS): FS is the Market value of any assets allocated to, but not required to support, the in-force covered business as at the valuation date. The FS has been determined as the adjusted net worth of the Company (being the net shareholders' funds adjusted to revalue assets to Market value), less the RC as defined below. Required capital (RC): RC is the amount of assets attributed to the covered business over and above that required to back liabilities for the covered business. The distribution of this to shareholders is restricted. RC is set equal to the internal target level of capital equal to 170% of the factor-based regulatory solvency requirements, less the funds for future appropriations ("FFA") in the participating funds. 55 HDFC Life#56Indian Embedded value: Methodology and Approach (2/2) Components of Value in-force covered business (VIF) ■ Present value of future profits (PVFP): PVFP is the present value of projected distributable profits to shareholders arising from the in-force covered business determined by projecting the shareholder cash flows from the in-force covered business and the assets backing the associated liabilities. Time Value of Financial Options and Guarantees (TVFOG): TVFOG reflects the value of the additional cost to shareholders that may arise from the embedded financial options and guarantees attaching to the covered business in the event of future adverse market movements. Intrinsic value of such options and guarantees is reflected in PVFP. Frictional costs of required capital (FC): FC represents the investment management expenses and taxation costs associated with holding the RC. VIF includes an allowance for FC of holding RC for the covered business. VIF also includes an allowance for FC in respect of the encumbered capital in the Company's holdings in its subsidiaries. Cost of residual non-hedgeable risks (CRNHR): CRNHR is an allowance for risks to shareholder value to the extent that these are not already allowed for in the TVFOG or the PVFP. In particular, the CRNHR makes allowance for: - asymmetries in the impact of the risks on shareholder value; and - risks that are not allowed for in the TVFOG or the PVFP. CRNHR has been determined using a cost of capital approach. CRNHR is the present value of the cost of capital charge levied on the projected capital in respect of the material risks identified. 56 HDFC Life#5757 45 Embedded Value: Economic assumptions Forward rates % Spot rates % Years As at Dec 31, 2021 As at Dec 31, 2022 As at Dec 31, 2021 As at Dec 31, 2022 1 4.04 6.80 3.96 6.58 2 5.42 7.40 4.62 6.86 3 6.29 7.70 5.11 7.05 4 6.94 7.81 5.51 7.17 5 7.41 7.83 5.84 7.24 10 10 8.26 7.55 6.80 7.32 15 8.03 7.45 7.15 7.28 20 7.62 7.57 7.24 7.27 25 7.28 7.80 7.22 7.30 30 7.05 8.06 7.16 7.36 1. Forward rates are annualised and Spot rates are continuous HDFC Life#58Glossary (Part 1) APE (Annualized Premium Equivalent) - The sum of annualized first year regular premiums and 10% weighted single premiums and single premium top-ups ◉ Backbook surplus - Surplus accumulated from historical business written ■ ■ Conservation ratio - Ratio of current year renewal premiums to previous year's renewal premium and first year premium Embedded Value Operating Profit ("EVOP") - Measure of the increase in the EV during any given. period, excluding the impact on EV due to external factors like changes in economic variables and shareholder-related actions like capital injection or dividend pay-outs. First year premiums - Regular premiums received during the year for all modes of payments chosen by the customer which are still in the first year. For example, for a monthly mode policy sold in March 2021, the first instalment would fall into first year premiums for 2020-21 and the remaining 11 instalments in the first year would be first year premiums in 2021-22 ◉ New business received premium - The sum of first year premium and single premium. ◉ New business strain - Strain on the business created due to revenues received in the first policy year. not being able to cover for expenses incurred HDFC 58 Life#59◉ ■ ◉ ■ ◉ ◉ Glossary (Part 2) Operating expense - It includes all expenses that are incurred for the purposes of sourcing new business and expenses incurred for policy servicing (which are known as maintenance costs) including shareholders' expenses. It does not include commission. Operating expense ratio - Ratio of operating expense (including shareholders' expenses) to total premium Proprietary channels - Proprietary channels include agency and direct Protection Share - Share of protection includes annuity and health Persistency - The proportion of business retained from the business underwritten. The ratio is measured in terms of number of policies and premiums underwritten. Renewal premiums - Regular recurring premiums received after the first year Solvency ratio - Ratio of available solvency Margin to required solvency Margins Total premiums - Total received premiums during the year including first year, single and renewal premiums for individual and group business Weighted received premium (WRP) - The sum of first year premium and 10% weighted single premiums and single premium top-ups HDFC 59 Life#60Disclaimer This presentation is for information purposes only and does not constitute an offer or invitation to sell or the solicitation of an offer or invitation to purchase any securities ("Securities") of HDFC Life Insurance Company Limited ("HDFC Life" or the "Company") in India, the United States, Canada, the People's Republic of China, Japan or any other jurisdiction. This presentation is not for publication or distribution, directly or indirectly, in or into the United States (including its territories and possessions, any state of the United States and the District of Columbia). The securities of the Company may not be offered or sold in the United States in the absence of registration or an exemption from registration under the U.S. Securities Act of 1933, as amended. The Company does not intend to register any securities in the United States. You confirm that you are either: (i) a "qualified institutional buyer" as defined in Rule 144A under the U.S. Securities Act of 1933, as amended, or (ii) outside the United States. By receiving this presentation, you are agreeing to be bound by the foregoing and below restrictions. Any failure to comply with these restrictions will constitute a violation of applicable securities laws. This presentation should not, nor should anything contained in it, form the basis of, or be relied upon in any connection with any contract or commitment whatsoever. The information contained in this presentation is strictly confidential and is intended solely for your reference and shall not be reproduced (in whole or in part), retransmitted, summarized or distributed to any other persons without Company's prior written consent. The Company may alter, modify or otherwise change in any manner the contents of this presentation, without obligation to notify you or any person of such revision or changes. This presentation may contain forward-looking statements that involve risks and uncertainties. Forward-looking statements are based on certain assumptions and expectations of future events. Actual future performance, outcomes and results may differ materially from those expressed in forward-looking statements as a result of a number of risks, uncertainties and assumptions. Although Company believes that such forward-looking statements are based on reasonable assumptions, it can give no assurance that your expectations will be met. Representative examples of factors that could affect the accuracy of forward-looking statements include (without limitation) the condition of and changes in India's political and economic status, government policies, applicable laws, the insurance sector in India, international and domestic events having a bearing on Company's business, particularly in regard to the regulatory changes that are applicable to the life insurance sector in India, and such other factors beyond our control. You are cautioned not to place undue reliance on these forward-looking statements, which are based on knowledge, experience and current view of Company's management based on relevant facts and circumstances. The data herein with respect to HDFC Life is based on a number of assumptions, and is subject to a number of known and unknown risks, which may cause HDFC Life's actual results or performance to differ materially from any projected future results or performance expressed or implied by such statements. Forecasts and hypothetical examples are subject to uncertainty and contingencies outside Company's control. Past performance is not a reliable indication of future performance. This presentation has been prepared by the Company. No representation, warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information and opinions in this presentation. None of Company or any of its directors, officers, employees, agents or advisers, or any of their respective affiliates, advisers or representatives, undertake to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise and none of them shall have any liability (in negligence or otherwise) for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection with this presentation. Further, nothing in this presentation should be construed as constituting legal, business, tax or financial advice or a recommendation regarding the securities. Before acting on any information you should consider the appropriateness of the information having regard to these matters, and in particular, you should seek independent financial advice. 60 60 HDFC Life#61Thank You 21 YEARS Protecting India with Pride ◉ HDFC Life