Note: This is a preliminary transcript and may contain inaccuracies. It will be updated with a final, fully-reviewed version soon.
Canara HSBC Life Insurance Company Ltd (NSE: CANHLIFE) Q4 2026 Earnings Call dated Apr. 28, 2026
Corporate Participants:
Anuj Dayal Mathur — Managing Director and Chief Executive Officer
Nitin Agarwal — Appointed Actuary
Tarun Rustagi — Chief Financial Officer
Analysts:
Prayesh Jain — Analyst
Mohit Mangal — Analyst
Unidentified Participant
Ansh Mehta — Analyst
Sanketh Godha — Analyst
Nischint Chawathe — Analyst
Swarnabha Mukherjee — Analyst
Nitesh — Analyst
Vinod Rajamani — Analyst
Unidentified Participant
Presentation:
Operator
Ladies and gentlemen. Good day and welcome to the Canera HSBC Life Insurance Q4FY26 earnings conference call hosted by Motila Loswal. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star and then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr.
Prayesh Jain from Motilal Oswal. Thank you. And over to you sir.
Prayesh Jain — Analyst
Thank you, Sagar. Good evening everyone. It is a privilege to host the senior management of Canada HSBC Life Insurance Limited for the for their Q4FY26 earnings conference call. From the management we have Mr. Anuj Mathur, M.D. CEO Mr. Tarun Nastagi, the CFO, Mr. Nitin Agrawal, the appointed actuary, Mr. Ritesh Rathod, Chief Strategy and Data Office Officer and Mr. Amit Jain, the head IR. I now hand over the call to Mr. Anuj Mathur, MD and CEO. Over to you sir.
Anuj Dayal Mathur — Managing Director and Chief Executive Officer
Yeah. Thanks Parish and good evening to everyone and a very warm welcome into our earnings call. In fact, this is the first time after our listing that we are kind of announcing our full year performance. So. So a very warm welcome to all of you. In fact, we sincerely appreciate your time and thank you for joining us today. Your continued engagement and insights are deeply valued. The financial results along with the investor presentation is available on our website as well as on the websites of both the exchanges.
So friends, I’ll start my discussion with some key macro developments which impacted the quarter. The global operating environment continues to remain uncertain with ongoing geopolitical developments leading to supply side disruptions across multiple sectors. However, despite these headwinds, the Indian economy has mastered resilience and we believe its long term growth fundamentals remain firmly intact. The insurance sector has seen some temporary moderation though our long term outlook remains unchanged supported by structural drivers such as increasing protection under penetration and steady growth in household savings.
From a regulatory perspective, we welcome the transition to INDAS which will align our financial reporting with global best practices and over time bring increased consistency and transparency to business performance metrics. However, given that it is too short a time period, we have taken a prudent approach and obtained Board approval to take free of forbearance for a period of one year which is in line with the IID guidelines. So we will be writing to regulator for the forbearance shortly. Friends.
Now let me discuss the highlights of the business performance for FY26. Financial year 2526 witnessed significant milestones in terms of our listing, our IPO launch of agency business and superior business performance which I’m going to touch upon now. So on growth parameters we delivered healthy individuals WPI growth of 19% year on year, 20% in AP terms in FY26 which is in line with the guidance that we provided last year. We continue to outperform both the industry and private players by a big margin.
In fact our growth rate was highest Amongst the top 10 players in WPI terms in the industry which demonstrates the strength of our business. In Q4FY26 we grew at 15% year on year and we saw very decent shift in our product mix towards traditional and protection business. I’m also going to touch upon our value of new business VNB and VNB margin when I come to financial metrics. Key highlights during the quarter was shift in product mix towards traditional segment which led to the share of traditional mix rising to 81% in Q4FY26 compared to 39% which was till December 25.
Consequently for FY26 the overall mix between linked and non linked stood at 51% and that is with the guidance which we gave last time that we would like our product mix to be more balanced and this is what is there in the actual numbers. This reflects our strategy to pivot towards a balanced product mix and demonstrates our ability to proactively recalibrate our product portfolio to optimize value. Given the healthy growth that we have witnessed, our rank amongst the private players has improved to 9th in FY26 compared to 10th in FY25.
This is on WPI basis within traditional growth was broad based and led by new product launches in both par and non par segments which grew at a steady pace of 15% year on year. For FY26 the share in total AP at 28%. I will now like to talk about the protection business. So our protection business saw significant growth with credit life growing at 40% year on year for the quarter while individual prediction continued to grow from a low base share of total protection rose to 7% in FY26 from 4% in the prior year FY25 and we’ll continue to focus on this to increase protection mix Further coming to annuity in AP terms we saw healthy growth of 24% year on year for FY26 with share largely steady at around 14%.
We continue to focus on deferred annuity which provides long term customer value and earnings visibility. I will now talk about our persistency. So friends, our 13 month persistency also saw significant traction and I’m happy to share that renewable premiums maintained very steady momentum recording a 25% year on year growth for FY26. We continue to see improvements in persistency across cohorts. Our 13 month persistency has risen to 86.3% from 84.4% in FY25 so it’s a 1.9% jump in 13 month persistency.
Our 61st month persistency has also shown steady improvement and currently stands at around 55.5%. These consistent improvements underscore the strength of our customer retention, the quality of sales practice and the long term sustainability of our growth trajectory. Along with the premium growth, our number of policies also grew at 7% year on year which shows gradual movement towards increase in penetration. Friends, while early days I’m happy to share that our recently launched agency channel is performing in line with the company’s plan.
We have onboarded about 500 distributors and we collected a premium of 14 crores in AP terms in this channel in less than six months of our launch. We will continue to scale up this channel in a phased manner and remain confident of further growth in FY27. Our alternate channels have also grown by 29% over previous year and currently it contributes to roughly 9% of RWPI. We are on this journey to increase share of alternate business to 15% over next three years. Now let me take you through some of the key financial metrics.
So our value of new business VNB for FY26 stood at rupees 627 crores registering a growth of 41% year on year. Despite GST headwind we reported a healthy VNB margin of 22.4% for FY26 up from 19.1% FY25. The margin improvement was led by a favorable product mix shift towards protection and improvement in product level margins. Without GST impact our margin would have been around 24.6% which is closer to the market consistent margin coming to profit after tax for FY26 stood at 127 crores, an increase of 8% year on year.
On the expenses side we continue to work on optimizing our expenses on the back of increase in volumes and continuous technology initiatives, various AI initiatives. Consequently, our total expense ratio was stable at 18.7% in FY26. Excluding GST and Labor Code impact it is at 17.5%. Our embedded value grew at 18% year on year reaching 7233 crores. With an operating RoEV of 20.7%. Our solvency ratio remains comfortable at 190%. Coming to customer centricity, that’s a focus area for the company. We continue to see improvement across key metrics which measure customer centricity.
I earlier touched upon improvement in our persistency across cohorts. I’m happy to share that we continue to excel on customer services front and have witnessed a significant improvement in our NPS score Net promoter score which is a testimony of the customer experience. Our net promoter score NPS has improved from 76 in FY25 to 80 in FY26. Our claim settlement ratio has also improved from 99.4% in FY25 to 99.6% in FY26. Another important achievement for us which is on the people front. We participated in the great Places to Work survey.
We have been doing that for last five years and our ranking has improved there also. So we used to be in top 50 in BFSI space. I’m happy to share that our company now features in top 25 companies in the BFI space as per this latest GPTW survey. Just to close now, to conclude, we would like to reemphasize our strategy of maintaining above industry, profitable growth, balanced product mix, consistent growth in VNP and a phase growth of our agency channel. So thank you everyone and with this we are now happy to take any questions that you guys may have over to you.
Questions and Answers:
Operator
Thank you very much. We will now begin with the question and answer session. Anyone who wishes to ask a question may press STAR and then one on their touchstone phone. If you wish to remove yourself from the question queue, you may press Star and two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles again. To register for a question, please press Star and then one. Our first question comes from the line of Mohit Mangal from Centrum.
Please go ahead.
Mohit Mangal
Yeah, good evening and thanks for the opportunity. My first question is on the economic variance in the EV work. So it’s about 820 million negatives. So could you just spell out the reasons for the same.
Anuj Dayal Mathur
Yeah. Good evening Mohit and I’ll ask my audit
Nitin Agarwal
Actually Nitin Agarwal to answer this. So the main reason for this is actually the equity reduction. So the fall in equity markets. So that has resulted in the UL because you know the good proportion of UL is invested in equity. So the future, the future for charges, particularly the fund management charges, the impact of that on BIF is the main reason for the economic variance being negative for this particular year.
Mohit Mangal
Okay. If you can just split between equity and debt that would be very helpful.
Nitin Agarwal
So the main the difference is coming actually the reduction is mostly coming from the equity side. On the debt side generally what’s happened is on the VIV and network side they mostly cancel out. You know there’s an offsetting impact on the net worth of the viv. Whereas because on the equity on the unit link side mostly it’s the WIF that comes through. So the bigger impact is coming from equity. The debt side is very marginal.
Mohit Mangal
Understood, that’s helpful. My second question is on the GFC. So I think last time you said that about 185 basis point impact and I think we are in line with what you said. The impact on the VNB margin now going forward, how do you see this kind of panning out in financial year 2728? Do you see the BNB margin increasing and the impact of GST decreasing or how should we look into that?
Tarun Rustagi
So hi, thanks for the question. So gst so we have rebased the margin now where we have already taken impact of 6 months of the GST impact. Plus like we mentioned that on the renewal commission we have already taken calls which is actually helping us to reduce the GST impact in future also. So keeping that in mind, we don’t see that it is going to further impact. Obviously there will be some annualized impact next year. But at the same time as our business is growing, the product mix is shifting and also the protection mix is increasing.
We expect that the margin is expected to grow from the current level what we have reported. So this is what we are targeting.
Mohit Mangal
Understood, but you are not giving any numerical guidance.
Tarun Rustagi
So in terms of the VNB guidance it will be around. So we’ll improve over what we have reported this year. So it will be around 22, between 22 to 23% range.
Mohit Mangal
Understood. That’s very helpful also. Now good start to the agency channel. Wanted to know a little bit as to what they are selling. You know how has been the response? If you could just throw some color on that.
Anuj Dayal Mathur
Sure, yeah. So actually we have done well in the first six Months of our agency launch. I’ve got our chief agency officer Dinesh with me. So maybe he’ll talk about key matrices and the plans.
Unidentified Participant
So. Good evening, this is Dinesh. We’ve started on time as we wanted on 1st of October. And we are in the initiation stage of agency buildup. The leadership is in place and this is the first step that we have taken. And coming forth, I think quarter on quarter, we will now move on towards scaling up the business contribution coming from this channel. The product mix, the quantum of businesses that we’ve done now is 14 crores. So we are right now looking at more from a perspective of making a meaningful contribution in the overall business.
And the product mix will be in line with what the organization is looking for.
Mohit Mangal
Okay. And we
Anuj Dayal Mathur
Are looking at those to 5% contribution coming from agency over next three years. So I think that’s a broad guidance I like to give.
Mohit Mangal
That’s helpful. Last data keeping question, if you can spell out the rider attachment.
Anuj Dayal Mathur
Okay, so it’s about 70% on the UL based unit link policies. Roughly 70% policies. We are able to attach protection riders in premium.
Mohit Mangal
That’s really helpful.
Anuj Dayal Mathur
Very sorry. Actually it’s on NOP base. So 70% of the eligible customers we are able to attach riders.
Mohit Mangal
Okay, but in premium terms what that would translate to
Anuj Dayal Mathur
That number. Okay. The
Tarun Rustagi
Premium term, it’s in terms of total overall ULIP it is around 5% of the total premium which we have collected from unit.
Mohit Mangal
Okay, so there’s a big question.
Tarun Rustagi
Yeah, yeah. So the ticket size of, you know, riders are very small but it helps to enhance the margin of the unit link. So we are able to do that. So in terms of NOP it is around 70 plus. But in terms of premium size it is 5%. No, no,
Mohit Mangal
I got it, got it, got it. Very helpful. Thanks and wish you all the best.
Anuj Dayal Mathur
Thank you. Thank
Operator
You. Thank you. Your next question comes from the line of Ansh Mehta from Value Partners. Please go ahead.
Ansh Mehta
Hi Anuj. Hi Taran. Nice to touch with. Again just two questions from my side. First is we’ve seen some media reports on hsbc. Sort of trying to. Sorry to interrupt.
Operator
So you’re sounding muffled. If you’re using any external Bluetooth headset or anything, may I request you use. Yeah,
Ansh Mehta
Sure. Can you hear me now?
Anuj Dayal Mathur
Yes, it’s better.
Ansh Mehta
Yeah. So first question is with regards to. We have seen some media reports that HSBC might increase its life. Is this coming from BNB or camera bank? And how does that impact our product and channel mix? That is the first question in the near term and then the second question is with regards to the statement from the DSS Secretary with regards to open architecture already in Panera bank we have sort of NIC policies being sold. But what will be the impact in terms of counter share leasing and ic?
Sorry to interrupt.
Operator
Volume is modulating so it’s not. So if I, if
Tarun Rustagi
I just repeat your question. First question was related to the media news with respect to HHSBC and the second question what you are saying asking is the statement made by DFS with respect to Banker and you mentioned that the LIC is already there as a one of the distributor in Canada Bank. So you want to understand our view, right?
Ansh Mehta
Correct. Yeah, yeah.
Anuj Dayal Mathur
On the first question I’ll say it’s a media speculation and as a company we would. We don’t comment on media speculation. So that’s on your first question. On the second question we have also read from media but we haven’t got any kind of details further from the DFS or regulator. So we will await regulatory guideline. But I would like to confirm that in our case Canra already has one more option. So in addition to Canra HSBC they have products from LIC also available in the counter. So that’s there.
So we don’t see this as any kind of big risk for us because we are already in that mode in terms of counter share. LIC is there for some time and I think currently their share is minuscule and our focus will continue. We are going to grow our business. So we are fairly confident that we will be able to manage our growth in Canberra bank. Hope that answers your question.
Ansh Mehta
Yeah, so that’s very clear and just on the. Of course I understand you cannot comment on media speculation but what will be the difference in terms of the product mix at HSBC branch versus the Canera bank branch in terms of more protection? If you can just comment on the product mix.
Anuj Dayal Mathur
So first of all Ayesha, I would request you to please delink the two topics. So if you want to know the product mix in Canada and product mix in HSBC I can share those numbers with you currently as they stand. So it has got no linkage first of all with the shareholdings. I just wanted to clarify on that front.
Ansh Mehta
So yeah,
Anuj Dayal Mathur
Yeah. So in HSBC because the kind of customer profile we have where the risk appetite is also higher there are unit link proportion is around 60% or so. And in Canberra bank our UL proportion again would be in the range of about 50%. So that’s a broad kind of Indication for the time being.
Ansh Mehta
Right, understood. Okay. Okay, that is very clear. Thank you. Thanks all. Thank you very much. And all the best.
Operator
Yeah,
Anuj Dayal Mathur
Thanks. Thanks.
Operator
Thank you. Your next question comes from the line of Sanket Goda from Aventus Park. Please go ahead.
Sanketh Godha
Yeah, thank you. Thank you for the opportunity. Sir, if I add back the GST impact and labor code impact, honestly you are closer to 25 and you guided that the number will be more 2223 for the full year next year. So is it not fair to say that the real number is more closer to 25 going ahead or I’m missing something when you said 2223 kind of a number for the next year.
Tarun Rustagi
So Sanket, thanks for the question. So what? So in this 22.4 there is also benefit which we have got from the, you know, yield curve and which there is a possibility that it might not, you know, repeat itself in the current year which is 26, 20. So if you look at the work which we have presented so that if I take away that plus there is a full blown impact of the agency growth which will be a negative strain. So that is also going to take away some bit of a margin. So this therefore what we are expecting that will continue to grow our margin and expect it to reach around the range which we have provided.
So that is going to be our guidance.
Sanketh Godha
So which means that the yield co benefit maybe largely will pass on to the end consumer in the current year probably. And therefore, therefore that benefit, what you got to 200 basis points in the current year might not be there. And therefore, therefore more realistically you are looking at 22, 23 kind of a number. That’s the way I need to understand.
Tarun Rustagi
Yeah. So there is a possibility that we have to pass on that benefit to the customer and also it depends on the, you know, market direction. Market direction. So if let’s say the yield curve is going to further improve then obviously we’ll get continue to get the benefit. Otherwise it has corrected from the last, you know, it has it crossed 7% 10 year G SEC rate. If I say but now it has come back again to 6.75 to 60 point. So I think that is something which will be totally depending upon the market.
Sanketh Godha
Sorry to ask again. Suppose the yield curve broadly remains at the current level for the last part of the next year. Then the only reason the margin should be 20 to 23 is that if you pass on the benefit to end consumer, assuming macro doesn’t change.
Nitin Agarwal
Actually just one more thing, because the GST impact Actually for last year was only half year impact. Whereas in the coming year it will be a full blown impact of full year. So that will also have a negative impact. Plus we obviously have agency also there with a full blown. So that could also have a detrimental impact. So in spite of the yield curve, that is the reason why we are giving a direction.
Sanketh Godha
And this operating assumption changed 50 basis point negative impact is largely because of the investments you made in agency channel.
Nitin Agarwal
No, the operating assumption change, the negative one is mostly on account of some of the demographic assumptions that we made. We’ve strengthened some of our questions the assumptions as we’ve seen improvement in our questions assumptions. So this is more like a one time, you know, negative impact. But over the future we will see positive impact coming out of that.
Sanketh Godha
And that explains the same in the EV walk, right? That 9 crore number probably.
Nitin Agarwal
That’s right. That’s right.
Sanketh Godha
Okay, understood. And given, given our economic variance number. Sorry, operating variance number seems to be meaningfully very big. Around 130 crores in the EV work. Just wanted to understand where it came from. Assuming I’m believing it should not be related to mortality. Given. Given. You said it’s largely because of the opex.
Nitin Agarwal
Yes, that’s correct. It’s largely because of the OPEX OPEX efficiencies and obviously the number of policies and the volumes are increasing. So that is helping our unitized cost. So the per policy cost is improving that is flowing into iv
Tarun Rustagi
And this is the same direction or guidance which we provided, you know, throughout that we will continue to have operating positive variance coming to us as we increase our base and also efficiently run the business on the expense side.
Sanketh Godha
Understood. The reason I was asking also is that given. Given we have seen improvement in the persistency, maybe if you have revised the assumptions based on the. If you had a variance or positive benefit because of the persistency improvement that is also getting reflected in this 130 crores or not.
Nitin Agarwal
So the presidency assumption is not getting reflected. So it is indirectly getting reflected because of persistency the number of policies are increasing. So for our maintenance costs, you know, the maintenance cost getting divided by the, you know, number of policy that is helping our policy cost. So that is. You’re right. So that is also helping. But indirectly not in that of. Not in the demographic assumption column. Over there it’s a one time negative impact. But over here it’s coming as a positive.
Sanketh Godha
Understood, Understood. And another two questions. One is more on capital side. Suppose we are at 190solvency and maybe I’m not Sure. Whether the subject what you intend to raise is part of this 190 or not. If it is not, that might further improve it. But if you intend to grow more protection or more non par or more annuity and even agency which are capital strain or strain to your PNL then whether it will trigger some kind of capital raise or anything on those lines or do you think this 190 is good enough to take care of this current growth rate of 20% plus what you’re reporting for the full year?
Tarun Rustagi
Yeah. Sanket 190 includes some debt which you raised 250. There is a negative impact MTM impact which is actually impacted the solvency adversely because we have some equity in the non unit link fund also. And as for the solvency, you know, calculation we have to take the MTM unrealized losses there which has already recovered to the extent, you know, almost 50 to 60% now. So this is a short term impact which we have seen. So our solvency is going to go back upward of you know, 200% and that will be sufficient for us to write additional protection business which we are targeting.
And as and when we will be requiring more capital we will be again evaluating, you know, the timing and the quantum of that.
Sanketh Godha
Understood, Understood. And lastly if you can give that number of protection which is 205 crores broken down into retail and credit life.
Nitin Agarwal
Almost 50, 50.
Sanketh Godha
Almost 50. 50. Okay, understood. Yeah, that’s largely my questions. If any, I will come back in the queue.
Nitin Agarwal
Thanks.
Operator
Thank you. Ladies and gentlemen, in order to ensure that the management is able to address questions from all the participants in the conference, please limit your questions to each per participant. You may rejoin the queue for any follow up questions. Our next question comes from the line of Mishin Chavate from Kotak. Please go ahead.
Nischint Chawathe
Hi, thanks for taking my question. I was looking at your VNB walk and when I look at the business impact of around 340 basis points positive, this largely reflects the growth in protection business. Right. Or is there any other change in composition? Composition broadly just added similar.
Nitin Agarwal
Sorry. So yeah, I would attribute it to primarily three reasons. So one as correctly pointed out by you is the increase in protection both on the individual and credit side. Second is the high rider attachment as we already mentioned at about 70% rider attachment which is again something which we’ll continue to grow because right now we are still focusing on you know, one or two riders but in future we see potential to increase our riders number of riders as well like CI and everything. Something which we are not still exploring too much while it’s there in the product suite.
But so that’s something again which we expect to increase going forward. The third one is coming from the credit lines and the PTPPT mix. So our business profile have also, we’ve also been focusing this year on, you know, higher PTPPT mix which is also both in the ULEP and TRAD side, which has also helped grow our margins.
Nischint Chawathe
Got it. And just one small thing. Have you given any guidance or shared any thoughts on the growth that you’re looking at this year. On that
Anuj Dayal Mathur
Basis? The current uncertainties which are there, the geopolitical uncertainties? We would not like to give any kind of guidance for the time being. One thing which I’ll definitely like to mention and we are pretty confident about that is that our growth will be superior to the industry growth which you would have seen in the past. Also that we will continue to outperform the industry and once there is clarity on this geopolitical front, then we will be happy to give guidance on the top line also starting from next quarter.
But as I mentioned, we are fairly confident that our growth will be superior to the industry growth
Nischint Chawathe
And fair to say that, you know, the forthcoming guidelines on whatever changes could be made on agency commission or deferment or you know, whatever, you know, in the, in the works, you know, don’t affect you as much.
Anuj Dayal Mathur
See that in fact we have been, we have shared in the past also that our commission rates are quite reasonable. So we don’t have the exact numbers coming in the new regulations. So really comment on that. But I think we are pretty kind of well positioned to take care of that. I don’t think so. It will be a challenge for us while we await final numbers or guidance coming from the regulator on that.
Nischint Chawathe
And just one last thing is IFRS readiness. Would you kind of wait for a year and do you kind of do IFRS for hsbc?
Tarun Rustagi
No. So we don’t report IFRS number to HSBC and we were actually going as per the earlier schedule of first April 2027. And as mentioned in the opening comment by Anuj, we are going for a forbearance for one year and will be implementing from the 1st of April 2027.
Nischint Chawathe
Got it, got it. Thank you very much and all the best. Thanks.
Operator
Thank you. The next question comes from the line of Swarnabh Mukherjee from 361 capital. Please go ahead.
Swarnabha Mukherjee
Hi sir, thank you for the opportunity. A couple of questions from my side first sir. As you had mentioned that your expectation is to outperform the industry growth. I just wanted to understand from the product point of view, you know, in which segments do you anticipate you know will be the major driver of the growth? I understand the cyclicality that might be there in categories based on the overall macro environment. But when I look at you know, at a quarterly level, your mix etc. So Normally I think Q3 kind of growth have been looks like gets driven a lot by ULIT and then in other quarters I think share of traditional products pick up.
So maybe you know, if you could highlight, you know what would be your thought process regarding product segment level growth that would be helpful. And if you can also highlight maybe you know what what is. Is it just the factor factor of macros where we have in the last last two third quarter numbers have seen a higher higher mix of unique or is there any channel level strategy that kind of leads to that? That is my first first question. Second is I just wanted to also understand you know the sensitivity numbers that you have reported in terms of.
In terms of embedded value from FY25 vis a vis that in FY26 there has been quite a drop. So just wanted to understand how this is playing out in terms of the numbers. Yeah, yeah. Sorry sir, one last question again on the product mix side is that. I think so this is and sorry I joined it a little late maybe you have mentioned in opening statement but this is more like protection and I see that there is also traditional savings you have mentioned in the presentation. So is this like non part product because star you have mentioned I think separately.
So just wanted.
Anuj Dayal Mathur
Sure, sure. So I’ll try to first answer your first question and third question together and then I’ll request our appointed actually to talk about the sensitivity. So see first of all I’d like to mention that we should not be looking at month on month or quarter on quarter position. I think our overall strategy is very clear that we want a pretty balanced product mix which would mean roughly 50% Juliet and roughly 50% traditional. So that is number one in terms of our overall strategy on the product mix.
Number two, yes, the market conditions also impact to some extent in terms of market appetite for a particular category of products. So we have seen in last quarter which was JFM quarter obviously the markets were not very supportive. So obviously the customer preference also shifts accordingly. But I’ll also like to mention that new product launches also play a very important role in this. So in fact in the month of February and March we had launched new additional products. One was par. The other was Non par and that had some kind of good customer outcome which resulted in our traditional mix actually going up in these two months.
So I would say there are a couple of factors which determines what kind of product mix for a particular period. But largely and I think my request will be that we should look at it at from long term perspective. When I say long term, at least one year that product mix will be balanced and within that as and when we launch products or we are depending on the market conditions, percentages can go up and down, there can be minor variation. But on overall basis from long term perspective our guidance is very clear and we’ll stick to that.
Now I’ll request my colleague Nitin to talk about the sensitivity.
Nitin Agarwal
So on the interest rate sensitivity, I think this is something which we’ve been talking about the last few investor calls as well that we’ve been, you know, we’ve been working has been a tactful, you know, tactful tactical call to increase the assets of the duration of assets which has helped in reducing the sensitivity. In addition to that we’ve also been increasing our hedging ratio. So we’ve been increasing our investment in derivatives which is also helping in reducing the interest rate sensitivity.
Swarnabha Mukherjee
Right sir, okay, understood. Just a couple of follow ups. Maybe, you know, can you maybe sir, highlight what proportion of your book would be hedged right now and instruments you are you using for the same? And sir, answer. I, I mean just wanted your views on how do you see say over a cycle, maybe not near term of course because of the volatility in the market, but how do you see the overall industry level ape growth pan out in the life insurance industry over say maybe a two, three year point of view, assuming that it’s a relatively normalized scenario.
Thank you. Right,
Anuj Dayal Mathur
So in terms of business growth, top line growth, my expectation is that in this year, the current year because of the geopolitical industry may grow in the range of about 10% or so and over longer term, and considering that the regulatory environment continues to be favorable, which it is currently, and the markets also stabilize, I think we can expect growth in the industry to the tune of about 12 to 14%. That’s my take in terms of the industry growth.
Swarnabha Mukherjee
Right sir, got it on the hedging part, sir,
Nitin Agarwal
And the hedging. So we are at about 70% hedging ratio right now and we mostly invest in fraud the forwarded agreements as well as we’ve recently started investing in bond forwards as well.
Swarnabha Mukherjee
Okay, sir, okay, this is very helpful, thank you so much. Sir. And all the best for FY27. Thanks.
Nitesh
Nice.
Operator
Thank you. Your next question comes from the line of Nitesh Jain from Investech. Please go ahead.
Nitesh
Thanks for the opportunity. So my question is on channel mix and how which channel drove growth in FY26? Because we don’t have FY25 data to compare which channels drove that mix. And how do you see growth potential in Canberra Bank? Let’s say from a medium term perspective. And how are you planning to drive that growth in Canada Bank?
Anuj Dayal Mathur
Right. So we witnessed growth across all channels. So whether it was Canra, whether it was HSBC or other alternate channels across channels we have seen decent growth coming to the split. In terms of Canberra contribution that was about 72%. HSBC was 14%. Other banks close to about 6% and remaining 8% was alternate. So that that is the broad spread. 7, 2, 14, 6 and 8. This is in terms of channel wise contribution as of now last year.
Nitesh
And on the potential in Canberra bank, how do you see growth potential in Canberra Bank? And let’s say in terms of branch penetration, how many branches we have penetrated, what is the potential etc. And
Anuj Dayal Mathur
How
Nitesh
Do you plan to drive growth there?
Anuj Dayal Mathur
Right. No, I think we have really good potential in Canberra Bank. And this is something which we have shared over a period of time. Also since our listing that the customer base is huge, it’s about active customer base. If I talk about in camera, it’s about 8 and a half crore customer base. Currently our penetration is less than 2%. So there is ample scope for increasing our penetration. Coming to branch activation, our definition of activation is that a policy which is more than 50,000 rupees ticket size, if minimum 10 policies have been sold in a particular branch then we consider that as active.
So that’s the definition of our activation. And currently going by this parameter 54% of Canada bank branches are activated. And if you ask me whether all the branches have sold some policies then my answer would be yes. There would be branches who would have sold one policy, five policies, 10 policies. But our threshold is 10 policies with minimum ticket size of 50,000. And our activation has actually improved as I mentioned to 54%. It used to be 50% previous year.
Nitesh
Sure sir. That’s it from my side. Okay.
Anuj Dayal Mathur
Okay. Thanks.
Operator
Thank you. Your next question comes from the line of Vinod Rajamani from Nirmal Bank. Please go ahead.
Vinod Rajamani
Yes, thank you for taking my question. One question on this which has declined from 18,504 million to 15 odd million. So the question is based on this, you know, CAGR of above industry growth and this growth that we are seeing as well in protection as well as non parent annuities. What, what is the capital requirement? I mean if you have a three year plan, what will be the capital requirement and can, is it self sustaining at current levels or do you think, you know there will be further, there could be further capital raises or subordinated debt in FY27 or in the next three years.
That is, I think I just want to know what this capital raise that you’ve done and what is built in, into in terms of the growth expectations for different product categories. So that is question number one. The second question I have is on the agency channel. Now that you know, we have started recruiting and so on and we are building out this agency channel, what is our, what is our expectation in terms of say in the next two, three years? What, what level do we want to scale it to and what, you know, what targets do we have in mind?
So these are the questions I have. Thank you.
Tarun Rustagi
Right, so I’ll start with the first one. So like, like we mentioned that right now our capital is good enough to take a growth of protection business and various cohorts and you know, basis the prediction which you are asking is there is definitely if the capital need is there, we will be reaching market and raising the subordinate debt if that is required. But as our profit is building up that will continue to provide the support for this capital need. What we are looking for. So it is the growth and everything is well planned and structured and all the parameters are considered for capital requirement and for various product mix and the growth which we are targeting.
Anuj Dayal Mathur
On your agency question I’ll ask Dinesh, our chief agency officer to provide some details.
Unidentified Participant
Yeah. Good evening. We actually want to invest in the channel from a long term perspective and for diversification. It’s a strategic priority for us. Our roadmap centers on tier one led branch strategy and we want to make a meaningful contribution of around 5% in next three years time. We have to also be clear that it has to be a sustainable growth and it has to be done in a phased manner. That’s the current guideline that we have.
Ansh Mehta
Yeah. And we are seeing
Unidentified Participant
Some encouraging signals in the initial phase of first six months.
Ansh Mehta
Thank you.
Operator
Thank you. Before we take the next question, a reminder to all the participants. You may press star and then one to ask a question. Next question comes from the line officer Priyash Jain. Please go ahead.
Prayesh Jain
Yeah. Hi. Thank you for the opportunity and congrats on your great Set of numbers. First question is on, you know, while you alluded to the dynamics at Canada, could you also throw some light on HSBC as to, you know, what’s the kind of penetration? And I think if I remember correctly, there are more number of branches that HSBC is opening up. So what’s the status there and how are we scaling up that? That’s my first question. I will follow up with my second later.
Anuj Dayal Mathur
Sure. Okay, so HSBC has actually delivered good growth of 29% last year. And I think that trajectory will continue. As you rightly said, HSBC is in expansion mode. So eight branches they have opened over and about 26 branches which were there already. So we are seeing very good traction in HSBC and and we are also looking forward to starting with the Gift City business which will also add to the business growth. So we are very, very kind of optimistic about growth of business in HSBC coming from obviously the NR base which is there.
And to answer your specific question on penetration, in the premier segment which they have where we primarily sell insurance, our penetration is close to 14%.
Prayesh Jain
Okay, so is there any other channel which is not available to us today to address like a credit card customer or any other category of customer HSBC which we are not serving today and has a potential to be opened up for us?
Anuj Dayal Mathur
Yeah, so there are segments. So for example, personal banking is one where we are expanding and also the credit card customers who may not be having bank account. So we have created propositions specifically to address that base. So we are very much aware of the potential which existed even in these categories and we are kind of creating products to suit those needs. In fact, Credit Life also is something which we sell in hsbc. And as the bank is focusing on mortgages, our contribution from Credit Life will also increase.
Prayesh Jain
Right. And you know, like when we compare say a Canada and SBI or the other PSU large bank supported player, you know, there’s obviously a big gap between the branch productivity. Obviously you worked over the last few years to kind of improve the momentum there. What are new initiatives that Canada would be taking to ensure that, you know, we continue to grow at a healthy pace? And so I think. Yeah, that was my second question.
Anuj Dayal Mathur
Right. So first of all, we are focusing on the branch activation. We want to further increase it. Currently it’s about 54%. We want to increase the activation. Number two on the productivity there also we have taken certain initiatives and we are using analytics to kind of figure out those particular cohorts where the potential is higher. So that’s One way of also getting into that customer base which may not be visiting branches but have the wealth or the kind of need for protection. So that’s where we are focusing upon taking help from analytics, customer segmentation, all of it to improve both branch productivity as well as branch activation.
And you are right, there is currently gap between SBI and other public sector banks. But if I talk about the numbers actually Canberra productivity levels are just next to SBI and amongst the PSU banks after SBI it’s Canra bank with the productivity and the activation numbers which are there. So. So we’re focusing there on business and as I mentioned earlier also there’s a lot of potential and we are following segmented approach and help from the data analytics to kind of further penetrate. So that’s what we are doing currently.
Prayesh Jain
And last question is on agency channel, you know obviously we have a decent branch network and already you know some bit of infrastructure already in place. Right, right. So you know so. So from say you know somebody setting up from ground up zero to someone like you, what kind of different share and what kind of momentum or do you think that the kind of profitability that you’re delivering do you want to front end expenses, some bit of more color apart from what you’ve given so far.
Anuj Dayal Mathur
Right. So we are currently leveraging on the branches which we have. So we have about 105 branches of Canberra HSBC 5 for agencies specifically we want to be active in at least 50 locations. So that will be mix of some specific new locations as well as using our current branch infrastructure. So that’s how we are going to optimize. And our backend is all in place for last 17, 18 years. So we are leveraging on that in terms of expansion. So basically it’s the new branches plus the number of distributors we are going to engage and the manpower to support that.
So basically the investment is going prime going to be primarily in the front end capabilities and we are going to leverage on our existing branch network.
Prayesh Jain
Got that? Thank you so much and wish you all the best.
Anuj Dayal Mathur
Thank you.
Operator
Thank you. The next question comes from the line of Siddharth Rajpura from Systematics Group. Please go ahead.
Unidentified Participant
Good evening, thank you for the opportunity and congratulations on the good numbers. I hope I’m audible. Yeah, thank you. So first on your new product, do you see any more gaps in your existing products segments where you think we will be launching more products? There
Anuj Dayal Mathur
See our product suite is complete actually we have products across various categories. So first of all I’d like to mention that There are no gaps in our current product suite, but you can always improvise and in fact there are new ideas which keep on coming up and that’s what we have done. When I talked about two new traditional products which we launched in February and March, what we looked at was on customer need as well as offering some attractive proposition. So it’s an ongoing thing. So I’ll not say there’s a gap in the product suite.
Product suite is complete, catering to all segments across age groups. But you always have the opportunity of designing new features, offering something innovative. And from the product development side, we always keep kind of focusing on some of these initiatives which is helping us in kind of growing our business volumes. So it’s an, I’ll say ongoing journey and we’ll continue to innovate our products and offer features which are unique in the market.
Unidentified Participant
Okay. On the volatility in the mix with actually generally it is with other bank also, but we don’t have the long period history of our, our insurers, so. So what generally how is the volatility? Is it Q4 being heavily means the Q3 being heavily focused on and heavily moves away from unit. Is that the trend Historic?
Anuj Dayal Mathur
Yeah. See, first of all, I like to mention that actually we don’t look at month on month or quarter on quarter. The guidance which we have given is for the year and depending upon the market conditions, depending upon the needs, we may kind of make some tweaks. So the broader guidance is 50% kind of UL and 50% additional. And month on month, quarter on quarter, it may vary. So there is no fixed seasonality, I’ll say in terms of product mix. But depending upon the market conditions, customer ask and new product launches, we may see spikes happening in certain months and we may see unit link selling in those months where the markets are kind of giving good returns and all that.
So my request would be rather than monitoring product mix on a month on month or quarter, on quarter basis, we should look at full year because that is what it matters. So that’s how we kind of monitor internally and then we’ve got various sales enablers which we kind of keep on changing from time to time to create excitement.
Unidentified Participant
Okay, and the channel mix that you gave recently I think is exactly same so as what we have reported. So I’m assuming it’s for FY26. So can you give the channel mix for FY25? It’s possible,
Tarun Rustagi
Yeah. It’s almost similar. It’s a similar channel mix. So there is not much change between FY25 and 26.
Unidentified Participant
Okay. And recently RBI came with a draft on the responsible business. Do you see any implications on ground, any change in terms of the bank’s operations after the draft? And you can see,
Anuj Dayal Mathur
First of all we welcome some changes. But right now they are draft. So we are looking for final guidelines to be issued and we’ll be very happy to implement. In fact, RCS practices are well governed and we’ll go with whatever suggestions or the guidelines issued by either RBA or irda.
Unidentified Participant
Okay. Can you give you a breakup in terms of your retail protection between online and offline?
Tarun Rustagi
This is generally offline. There’s online what we use Policy Bazaar retail. We are able to do mostly offline this time.
Unidentified Participant
Thank you. I am.
Operator
Thank you. As there are no further questions, I would now like to hand the conference over to the management for closing comments.
Anuj Dayal Mathur
Yeah. Thanks a lot to everyone for participating in this call. I know that it’s late in the evening. Thank you very much for all your support and looking forward to further engagements. So thanks a lot.
Operator
Thank you on behalf of Motilal Oswal. That concludes this conference. Thank you for joining us. And you may now disconnect your lines. Thank you.
Anuj Dayal Mathur
Thanks.