PB Fintech Limited (POLICYBZR) Earnings Call Transcript & Summary

Hello, everyone. A very good evening, and a very warm welcome to PB Fintech Limited's Earnings Conference Call for Quarter 1 Financial Year '27. Today, we have with us Mr. Yashish Dahiya, Chairman and Group CEO, PB Fintech; Mr. Alok Bansal, Executive Vice Chairman, PB Fintech; Mr. Sarbvir Singh, Joint Group CEO, PB Fintech; Mr. Santosh Agarwal, CEO, Paisabazaar; Mr. Mandeep Mehta, Group CFO, PB Fintech; and myself, Mohit, Head of Investor Relations, PB Fintech. I now request Yashish for his introductory note.

Thanks, Mohit. Good evening, everybody, and thank you for joining us. We've started '27 on a strong note with healthy growth across most of our insurance and credit businesses actually. The overall insurance premium is now at INR 8,372 crores. It's grown at 41% year-on-year. Importantly, this growth continues to be led by the protection category, which is our focus. New health and term insurance grew at 53% with new health growing at 59% year-on-year for the core business. This is an important indicator of both the opportunity in the market and the strength of our platform. Health and term both remain significantly under-penetrated as categories. And for our large and growing middle class, social security is very critical. That's sort of our big problem to solve. Our consolidated operating revenue grew 40% to INR 1,888 crores, with core insurance revenue growing at 46% and core credit revenue growing at 25% year-on-year. The credit disbursal was 31%. The consolidated PAT increased 92% year-on-year, which is again both going to the new business as well as the renewal business, to INR 163 crores, while PAT margin improved from 6% to 9% year-on-year. Just to put in perspective, that also means for the last 12 months, our PAT would be just about INR 750 crores plus/minus right now. So starting to kind of inch towards our target number for the year. Our core online total premium grew 41% year-on-year for the quarter. Core new insurance premium, including savings, grew at 39%. Excluding savings, it's 48%. This is amongst the highest we've ever had. If you know -- remember, for the last 13 quarters now, we have been upwards of 35% for our total new premium growth, excluding savings. The quality of the growth is also visible in our renewal and trail revenue. You see now that beautiful time has arrived, actually. While our renewal revenue has grown at 55% to INR 1,003 crores for the last 12 months. But now we're getting to a stage when you will see higher and higher growth in renewals for the next -- because this is the previous 3 years of fresh growth starting to pay off. So you will see higher and higher numbers in renewal growth here onwards. Building trust beyond the point of sale. Insurance is not -- clearly not about just helping customers buy a policy. Actually, the customer gets nothing when he buys a policy. The real test comes when they use that policy, which is at the point of claims. And basically, our claims servicing, both in terms of issuance as well getting the customer the policy as well as in claims. We now are at above 90% in terms of CSAT. We have supported 70,000 claims in this quarter that just went by for health insurance. We are increasingly using technology and claims-related information to make customers' conversations more transparent. Our advisers can demonstrate real-time real claims outcomes. So when a customer comes to us, we are able to explain to the customer in and around their area, how many claims we have settled. And should the customer be willing, we can even connect them to those customers for referral calls, et cetera. All this is very powerful in convincing new customers to buy from us. And this is being done at scale using tech. In our credit business, the core revenue grew 25%, while as I said, the core disbursals grew 33%. So the good news is credit is also back into growth now. The total credit disbursal is now at INR 4,366 crores for the quarter. The business continues to focus on customers with all different credit profiles. So if you really think about it, there is a high-end customer, there is a middle-end customer and there is a customer who cannot really get credit. We are helping all 3 solve their problems, and all 3 obviously have very different problems. PB Partners is expanding clearly across all areas. Now 78% of the GWP comes from Tier 2 and Tier 3 cities. We now have more than 500,000 advisers with the active partner count increasing 55% year-on-year to 1.13 lakh for this quarter that's gone by. Our strategy has been to increasingly work with smaller, higher-quality advisers and equip them with technology, product access, training and service support. We, of course, cover 99% of India's PIN codes, more than 19,000 pin codes. Our quarterly premium grew 46% year-on-year to INR 1,637 crores, while revenue grew 47% to INR 561 crores. A few data points which we were not sharing and which we are trying to share now. The share of employee benefit expenses was about 15% of the revenue for the quarter. It was 12% in the previous quarter, but that is because it was seasonally a bigger quarter. But it's 15% of revenue right now. Our top 100 partners' share of premium is 16%. We will further work actively in reducing this. We are very good. Once we track something, we really get it sorted. But it is 16% right now. We believe PB Partners can play an important role in increasing insurance access across India by combining local relationships with Policybazaar's technology, product breadth and service capabilities. Now this actually has quite astounded me because I don't think anybody expects this because there's a lot of lot going on in the UAE, but growth is not one of those things. And our UAE insurance premium grew 31% year-on-year for this quarter. Most of what we do is health and life insurance, similar to our evolution of our India business. Again, cross-border is a big part. So people who retire need health insurance in India. They need -- people need to plan for their children's education, et cetera. So that business has done well and has been very resilient in tough times. Our new initiatives continue to scale forward across the board. To conclude, we are seeing strong momentum across the group. As you know, insurance premium grew 41%. Revenue grew 40% PAT grew 92%. PAT margin improved to 9%. The interesting part is look at this over time. Over the last 5 years, from Q1 '22 to Q1 '27, our quarterly revenue has grown from INR 238 crores to INR 1,888 crores, which is a CAGR of 51%. So some quarters, something has worked, and some quarters, something else has worked. But overall, our CAGR of our growth has been 51% over a 5-year period, which is quite astounding. At the same time, our PAT margin has improved from negative 47% to positive 9%. And for those of us who track financial numbers better than I do, the best is just starting to come. So thank you, and I'll start looking forward to questions.

Thank you, Yashish. I request everyone to raise their hands for Q&A. The first question is from the line of Sachin from BofA.

Congrats on once again a great set of numbers. I have three questions. Let me go one by one. First question, Yashish, clearly, it's very strong insurance premium growth once again, and thank you for helping us understand from where the growth is coming. But when I look at the industry, particularly health and term, they are not growing as fast and you guys on that high base continue to show anywhere between a 53% to 59% of growth for health and term. Where is this growth coming from? Is it mainly coming from Tier 2, Tier 3 cities, or it's still the urban areas which are contributing to most of the growth? And is there a slightly different set of users versus, let's say, what most manufacturers are looking at it and hence, your growth looks so better as compared to them?

So you want to -- okay. Sarbvir?

Yes. I think, Sachin, I would say 2 things. I mean, I think we've been consistently saying the same thing that I think our growth ahead of the market is coming from 2 or 3 key areas. One is that we definitely spend a lot of money and invest in creating demand. I think that we've been doing over a long time. Step 2, we have -- when people come to our platform, they see very attractively priced and very well featured products, which are tailored to their segmentation and which are tailored to their needs very specifically. So they find them to be very relevant. And the number three, and I think most important point that we have made a huge uplift in our service level and our support at the time of claims. So I think when you put these 3 things together, people -- increasingly, we get e-mails from people saying that, "Please port policy to Policybazaar. I have not bought from you, but I want to use your services." And I think that is an indication of kind of the work that has been going on. And I feel like it's still early days. I think there is a lot more to go, and I think we can continue to grow faster than the market. What the level will be, time will tell. But I think these 3 things take a long time to put in motion. And I think right now, they are continuing to drive our growth ahead of the market. I also want to give you 1 or 2 examples of things that I think Policybazaar does, which many others don't want to do. One is like the use of monthly mode. So if you see in health insurance, largely, I think we are the only platform that really sells any scale on monthly mode. And almost over 30% of our business now comes on monthly mode. We collect all those monthly payments. We ensure persistency. We ensure renewal. And that's an investment. I mean you have to put in the investment to do all these things. But I think that allows -- there's a lot of discussion about missing middle affordable products. This makes the product affordable. It allows people who are not very high income to get things. Similarly, I'll just explain another product that we've been doing for a while, which is maternity. Typically, maternity has like a 1-year or a 2-year waiting period. We have a product where we are offering 3-month waiting period. Now there's a structure over there. But this gives a lot of young families a reason to buy health insurance. And then, of course, they stay and then they renew their thing. Now again, this is a little bit of investment upfront into something that pays off. So I think these are the 2 things. We take a long-term view. We look at customer acquisition on a lifetime value basis. And number two, as I said, we have really worked on the 3 things that matter, bringing traffic, good products and then offering very high level of service and claims support.

And just so there's no misunderstanding on this, 82% of our business that's coming in is new in the sense they've never had an insurance policy in the past, so -- because port was mentioned as one thing. So port is still a small fraction of the people coming in, yes.

Very clear. My second question is, clearly, now there are 2 elements which -- on the revenue, which also both become big. Number one, Yashish, as you indicated, renewals and going ahead, a higher part of the growth should come from renewals. And second is, as Sarbvir just indicated in the answer, health and term should continue to show a sort of a strong growth. Health, in particular, in the initial years has low margins. So when we look at the blend of 2, how should we think about margins? Now that renewals is becoming bigger and bigger, directionally margins should continue to improve going ahead, right?

See, I think 2 things here. First of all, I think over the next 12 months at least, and Sarbvir can correct if he thinks differently, but I don't think he'll think differently. I think renewals growth will beat fresh growth just because renewals growth is so high now. It's going to be quite high. Renewals growth is going to be upwards of 50% for some time now. And I don't think our fresh growth will be that high. So that's one. But the second thing is, see, I've always said one thing. We are not here for the short run, and we are not here to deliver short-term efficiency. So we are actually increasing our spends. We are actually increasing our acquisition spends. We are going even more aggressive than ever before. So I think, Sarbvir, you might want to answer this question in terms of margins.

Sure. Yes. I think, Sachin, again, very consistently, theoretically, yes, you can make more money as the renewal percentage goes up. And as Yashish said, the growth rate could be higher. We don't know that yet. But I think the point which is more important is to say that if you are thinking of it at a lifetime value basis, then we can actually still continue to reinvest and drive growth rather than just taking it to the bottom line and showing higher profits. So it's not about 27%. I think it's really about, I don't know, 37% or 47%. And hence, we need to keep pushing that whole thing. So I mean, again, it would be more pleasing if we grow our fresh business at a higher rate than honestly, if we grow our margin. So...

And you're consistently hearing the same thing from management across the board that we -- our P1 is growth. Efficiency will come, it will be for later. But we will get enough from our growth here. If you really think about it, we were at -- we crossed 1% at some point. I was just looking, right? Right now, we are at 2%. And so the 3% number that we've sort of broadly indicated as a percentage of premium is not very far off. So we will hit our numbers. We will hit, I think, more than you expect, but let it come from growth rather than from expansion of margin at lower growth.

Very articulate and clear. And last question, Yashish, when we look at some of the interviews given by the regulator, he's talking about an effort-based commission change. And to some, it is also getting interpreted as it's more on the lines of perhaps an asymmetric cut for different channels. So Banca might have a different cut versus, let's say, aggregators versus, let's say, manufacturers. Just wanted to understand how you guys are looking at this. And I also saw one of the interviews you had given in the past, which talked about in a worst-case scenario, PB Fintech might become a manufacturer. So want to understand from you what is that worst-case scenario? And how should we think about that?

Yes. I would say I don't even think about the worst-case scenario. It's -- anyway, let me come to a very basic thing. Legally, as defined by the regulator, the largest amount of effort in any sale needs to be put by a broker, more than any other channel. And that is as legally defined in terms of tasks to be undertaken by the regulator, in terms of customer support, in terms of sales, in terms of claim support, in terms of everything. So it's a very difficult position to take that the entity that is supposed to put the maximum effort is somehow doing -- meant to do less effort. So these things are legal at the end of it. And I would kind of leave it there. I think there's been way too many statements and way too many things, and I'm sure wisdom is developing. I used that word very carefully. And I think it will develop more. And I think we will see the result of it as it happens. Yes. And I don't anticipate anything. That was like -- sometimes they use these media interviews. It's very strange, and that's why I stopped doing media interviews, thankfully. I wasn't very pleased about doing them in the first place. But sometimes, you come under pressure and you do them because your own PR team is saying you need to do them, et cetera, et cetera. Now what actually happens is you say 10 things. And one of those things is the one they pick up. And that thing you said in point #9, and they make it the headline. And look, that's the reason, I guess, a lot of people in the regulated industry don't do interviews. It doesn't make any sense here. You're just kind of exaggerating something which -- it is a side point.

Can I just add?

Yes, please.

First of all, I want to make it clear that none of us want to say anything about the regulator. I mean, I think that is an independent process, and we have nothing to do with it. I think the point I just want to explain to you, Sachin, to you and everyone on the call, is that we've had 2 instances in the last 5 years, I've only been in this business for a short time, where we have seen that you had COVID, you had a great run, increase in demand for health and term insurance. The minute COVID finished, and it was like the mother of all epidemics the world has ever seen across the world, immediately the demand went away, right? The same thing we saw. Right now, we are in the middle of this GST thing. We saw Q3 very big, Q4 big. Now in Q1, it has already started to fade, and I think we'll be lucky if it goes through in Q2. So the point I'm trying to make is that demand for insurance is extremely low. So anyone who is selling insurance, by definition, has to make a significant effort to get there. And I think for a platform like ours, that effort is very, very visible in terms of the marketing spend that we have to do, the conversion resources that we have to deploy, the focus on service and claims. So I think I just want to just put out that this is the level of effort that is required. So it's not easy. I mean nothing really -- the trend doesn't last more than even 2 quarters, really.

What are the 4, 5 things anybody who wants to sell insurance needs to do? You need to generate inquiries. You need to convert those inquiries. You need to have some mechanism to technically do this, whether you do it through paper, whether you do it through technology, et cetera, et cetera. Then after the customer has paid for the policy, you need to get it issued. There is a process in that. Document collection, medicals, et cetera, et cetera. There's a process that needs to happen. After all this, you need to be there at the point of claims. These are the 5 things anybody needs to do. In this, a bulk of the cost actually goes in generating inquiries and converting inquiries. The platform part, while it seems like a big thing, is actually the easy part. There are about 300 platforms in this country on which you can go and transact insurance for most insurers for 20-plus insurers. So I don't think platform is the problem. The problem is generating an inquiry costs a lot of money. Converting an inquiry costs a lot of money. And then to bring goodwill by supporting customers and getting issuance and getting claims settled costs a lot of money. And someone like us who's been there for 18 years is just about getting to a point where they're making 1%, 2% of their premium as profits, and that too with interest income. If you take away interest income, it is still less than 1%, right? Maybe it's a weak quarter. Maybe for the year, it would be more than 1%. It's a weak quarter in the sense of the first quarter, right? So it's a strong quarter, but a weak quarter. But the point is, look, if anybody can do it for less, most welcome, be our guest, but I don't think it's feasible. I'll stop there.

We will now take the next question from the line of Prayesh Jain from Motilal.

Congrats on a great set of numbers. Firstly, I think you mentioned about 70,000 claims on the health insurance front that was supported by PB, right? And if I recollect well, you have mentioned in the past about 3,000 feet on street on the ground, right, with regards to this. So trying to understand this. I think we can probably do -- this ratio should have been much -- should be much better, right? So what is kind of -- is there -- what kind of effort that we need to kind of increase this? An extension to that would be, if you would have, say, 100 customers, how many would have claims in this quarter? And how claim -- understand in the policies that we are servicing and the number of claims that we are getting, how much of the -- how much are we kind of supporting the claims? That just helps us concretizing more the amount of efforts that you're putting?

See, whatever comes to us, we're supporting 100%. And basically, like why wouldn't we, right? And essentially, if you think about it, typically of our total policy base, roughly 1.25% to 1.67% or so would claim every quarter. And of course, there are high claim quarters and low claim quarters depending on whatever, but typically about 6% of your base claims every year. I guess it's not 3,000 people. It's a little less than that. It's a lot less than that. So -- and yes, those numbers make sense. It takes a lot of effort to settle a single claim also. It takes a huge amount of effort to get a claim sorted.

And Prayesh, I think you should understand that the flow is the customer typically goes to a doctor, doctor or somebody recommends you go to a hospital. And then they may -- sometimes they call us before they go to the hospital, sometimes they call us after they're in the hospital. So it's a mixture of things. And actually settling or holding somebody's hand through a claim process is actually quite complex and time consuming. So the good news is that a lot of claims actually go through largely on their own. It's those claims that get stuck or there is some reduction which the customer doesn't understand, et cetera, et cetera, which come to us. So it's -- we are a fallback. It's not like at this point, everyone is starting from us.

Right, right, right. Interesting. The second question was on, again, the motor piece, where -- how do you see this part of the business? Health and term have been doing phenomenally well. And motor has -- as an industry also has gone through slowdown? And what is the kind of growth that you would expect on the motor business? And again, on the health front, I just want to understand some recognition. How do you kind of account for, say, a 3-year policy? So entire premium is accounted in the total premium or it is just a 1-year premium that gets accounted? The reason I ask this question is when the renewal time comes, whether we'll have the long-term renewals contributing or not? That's the question. Those are two questions.

So yes, I think on the motor front, we actually had a good quarter. Our motor plus 2-wheeler direct business grew over 30%. Our motor business in PoSP grew close to 50% almost. So I think both parts in motor, we've been continuing to do well. Yes, I mean, I think we don't have necessarily a huge view on the motor business. I think as you know, right, it's dependent on new car sales, new bike sales and then over a period of time, those policies come to us because typically we are not a big player in the new market. And then we take care of the rollover and renewals. So I think that will continue. We gain share modestly every quarter, I think. And we will -- I think we have the infrastructure in place to keep doing that. On the health side, the way we do is we report premium on a collection basis. So we show you the 3-year premium as part of our base or the number that is reported to you. And of course, on a renewal basis, we measure by number of policies. Our focus is not on premium, but on number of policies. And based on the -- whatever base is due for renewals, we compare how much we are able to renew. And I'm happy to report that both in the first year renewals and in the second year and beyond renewals, we are at all-time high renewal rates at Policybazaar.

And just to clarify, on the multiyear versus single year kind of plans, et cetera, we track our number internally. We call it indexed growth, which means annualized health insurance growth. That is not very different. There would be a gap of 5%, 6% between...

100 basis points. This quarter, 100 basis points.

100 basis points is the difference between index growth and overall growth. So multiyear is not pushing a big element in that.

Yashish, last question on the PB Health, right, whatever you can share more, and every quarter, we kind of ask this to you.

We just got -- 1 minute before this thing started, we just got the approval to start billing in our second hospital. So yes, we are moving step by step. See, revenues are there. As you can see, our total loss for the quarter is about INR 7 crores or so. We have -- we are also doing preventive health. We had acquired Fitterfly last year. Since when we acquired them, their monthly revenue is up 4x. See, we are eventually an operational workhorse here. Now we've gotten behind a new category. So you'll see us deliver stuff, right? We have our internal numbers. They are actually quite impressive as we look at our targets for -- I think I speak my mind, so I don't care what you think about it or whether I'm speaking ahead of time. By March next year, we will have annual run rate of about INR 500 crores. We would be breakeven. I'm talking about March '27, not March '28. So yes. Now we may not achieve it, we may achieve it, but that's our target. That's our internal target. We might be slightly ahead. We might be slightly behind. And I think opening hospitals is not an easy business. We are about 1 year into this, and we've got 2 going and 1 from scratch and quite a few in the pipeline. So I think we are coming into this sector. See, think about it from a very simple perspective. What percentage of hospitals billing is coming from insurance? Give or take 30%, 35%, 40%, depending on which hospital you're talking about. Now just take this number 10 years ahead and just ask yourself a very simple question, what percentage of Indian hospital billing, corporate hospital billing will come from insurance? And what percentage of Indian health insurance will Policybazaar be and its friends be? I don't say just Policybazaar. Policybazaar and friends, and that's all the insurance companies, right? We have all friends everywhere. So I think health care, and I think the interdependence of these 2 is not very well understood by most. People think this is a kind of a relationship of if you get more, I get less. No, it is not. Health care will develop if insurance is sustainable and if claims are good. That is how health care will develop across the country. Otherwise, we're limited to these 7 cities where you have -- who can afford health care, who can afford hospitals today? Either you are rich or you have a government job or ECHS, CGHS, something, or you have insurance. Nobody else can afford hospitals. Now how many people in the country are rich and how many have government jobs? And will that grow alone or will health insurance grow? So health insurance will enable health care and good aligned health care will enable insurance. So I actually don't understand the complexity here. It's, of course, tough here. It's not easy. And by the way, I don't like health care. Alok likes it. But it's working. It's working is all I would say. It's all good.

We would now take next question from the line of Dipanjan Ghosh.

Sorry, I think I was not able to unmute myself. A few questions from my side. First, if I look at your savings business, despite a relatively favorable and low base, I mean, it continues to be a little bit on the softer side. I understand you previously articulated that you're normally a platform business and a lot of the customers are pull in nature, especially on the savings side. So is that the reason for this softness? And also, I think over the last 1 to 2 years, you have been focusing on developing the children's plan and some of the pension categories. So what would be the mix within the savings business of those categories? And how would that be kind of growing at this current juncture? So that's my first question. Second, on Paisabazaar, you have mentioned that you'll be starting the daily SIPs from August '26, if I understood correctly. So what would be the monetization strategy? And has there been any pilot in terms of understanding the addressable market? And also ex of credit, what are the -- what is the sort of monetization or revenue pool that you think you can build on Paisabazaar, let's say, over the next 2 to 3 years? Yes. So those were my two questions.

Sarbvir, you can go.

Yes, yes. So I think on the savings side, Dipanjan, we grew over 20% in the fresh business in Q1. So yes, you're right in saying that it doesn't seem so great if you look at it versus last year. I mean, in the sense that you could have expected more. But then the 2 years before this, we had a very big quarter, very big year. So I think given the state of the markets, markets are kind of choppy. They go up and down almost every day. So it's a little difficult for people to build confidence. But I think beneath this 21%, there are 2 interesting developments that I would like to touch upon. First is I think we have expanded the concept of waiver of premium. So what you're referring to in child plans, the main story there was that not only can you set your goals, but you can protect your goals. Because if you buy a mutual fund, yes, you are saving for a goal, but something happens to you, that goal and the money will disappear, right? You'll only get whatever you invested. Whereas in waiver of premium plans, you can be assured that whatever plan you have bought, that entire amount of money will be invested and you will get a return. So we have expanded this category beyond just children to say that every goal should be protected. And I think every month, we have been expanding the percentage of our business that is coming from waiver of premium. And actually, I'm very encouraged by that, and I feel that in the next few quarters, this will help drive the business. And it's kind of talking about insurance plus investment now. We are not just talking of investment. So I think that's an interesting and positive development. And the second point that -- sorry, the second point that I want to make is GIFT City. In GIFT City, we started last September, and we have very soon become, frankly, the dominant and only player in retail insurance sales from GIFT City. And savings, we are doing a very good job. We are being able to sell dollar plans both to our existing base. So very interestingly, people who have bought nonresidents who have bought plans from us in the past, they are buying them again, and of course, to new customers who are coming. And I think the good news in this GIFT City side is that it opens up the entire spectrum of global investing. So it's no longer just India. We can sell technology-based funds, we can sell other countries, et cetera. So I think these 2 developments give me a lot of hope. We we only sell certain types of products. The products have to be very efficient, et cetera. So there is a limitation in terms of how fast we can go. But we are -- I think these 2 developments will definitely take us forward. Yashish is saying that we should talk of WoP as a percentage of the business. In the domestic business, in some centers, it has crossed 60% now in July. So I think WoP, waiver of premium, is the dominant story, and we are quite encouraged by that.

Santosh?

So yes, we are launching daily SIP platform. Look, I think -- see, this industry is growing at about 20%, 22% year-on-year. And see, a lot of, I think, salaried consumers already have enough and more options to buy mutual funds. And salaried consumers are people who have a daily -- a monthly, I would say, visibility of their income and hence, committing to a monthly SIP doesn't hurt them. But I think a large part of India, which is self-employed and work on businesses where the visibility of monthly income may not be that high, for them to commit monthly is very high. So a lot of self-employed people still are not in this category. I think our aim is to get those people in the mutual fund area and start -- help them start their savings journey. We've not really done a pilot to say, in the daily SIP category. Of course, I have had experience of building savings within policy. So with that, there's a lot of cross learning that's possible. And I feel self-employed is a category that today remains very low. Penetration is very low of any kind of savings products there. So there's a lot of scope.

From a 1- to 2-year perspective, actually, a lot of the savings that is being done in Paisa are not a revenue building activity. They are a stickiness building activity.

Yes. So there's -- I would say, just to answer the second question, I don't think there will be more than 5%, 10% of overall Paisa's revenue in the next 2 years or so. There are a lot of things that we're doing to build engagement on our app and savings, mutual funds, bonds and a lot of work on the payment side, which is basically bill payments, et cetera. So a lot of work is happening on that side to basically build engagement. That -- I think it's a loop, you get more data around consumer. Some people want loans. Some people want savings. So I think being able to see that and give these products to both of these kind of consumers, that's the attempt. But of course, very hard to say on where we'll be, but I don't think it will be more than 10%, 15% at best in the next 2 years.

Got it. Maybe one small follow-up to Sarbvir. Given the numbers you mentioned, would it be fair to assume that savings would be like 30% of your fresh business now more or less? And second question is, in this regard, I mean, you have historically not talked about it, but could you get some color on the margin profile of savings in the first year versus, let's say, your ex health overall fresh margins? Any color on that would be helpful.

I think Dipanjan economics of savings business, I think, is not necessarily to be discussed. I think it's fine. We do life insurance. We do term. And we do, I think, market-linked products. And overall, I think we are a very good combination from an insurance company's perspective. We get very high-quality customers, and these customers are good for us as well as for the insurance company.

Next question is from the line of Supratim Datta from Goldman (sic) [Jefferies].

I'll start maybe with the health piece. A few quarters back, you had talked about the combined operating model that you are running. Just wanted to understand how many insurers are now covered under this model? And how would the economics change under this regime versus what the previous regime was? So if you could give us some color around that, that would be very helpful. And then on the second bit, just wanted to understand what proportion of your motor insurance comes from motor third party. And currently, the Supreme Court yesterday passed a verdict saying that the TP period is going to be extended. So just wanted to understand how would that impact your business because yours is largely renewals, and now renewals will take longer to come in. So that's my second bit. And lastly, on the PoSP side of the business, thanks for the additional details that you have provided. And an interesting comment that you made was the top 100 currently contributes somewhere around 16% of your premiums and you plan to bring that down. So just wanted to understand how do you plan that? And on the PoSP side of the business, what is your focus? Is it scale? Or is it profitability over the next 3, 4 years? Yes, that would be my three questions.

Sarbvir, do you want to answer? Most of these are yours.

Yes, sure. I think -- Supratim, I think in terms of the core model, I think the best way to understand it is that we have aligned ourselves with -- I think what the Chairman sir has also said that channel should be paid as per the quality of business that they do, not just the volume of business that they do. So if you see we have aligned ourselves. I would -- rather than getting into the details of the model, I would urge and encourage you to think along these lines that it's really alignment of Policybazaar with the quality of business that we are bringing and then overall economics that the whole ecosystem is getting rather than just looking at us and insurance companies separately. So I think that -- as you can imagine, that is a welcome step from an insurance company's perspective also. And from our perspective also, I think it encourages us to focus on the right thing, right, which is double down on disclosure, making sure that the risk is well understood, making sure that we are focused on preventive health care. And now with PB Health coming online, I think that is going to be a big focus area for us. So I think it's -- the core model is really around that stuff. And I think directionally, I think it's -- I would say it is well received, and it's -- so far, it's going in the right direction. And I think that's the only sustainable way for a platform and for an insurance company to work because in the long run, both of us have to focus on the right things, making sure the customer does well, making sure that the insurance company does well and et cetera. So I think that's kind of on the health side. On the TP side, on the retail direct-to-consumer, it's about -- in value terms, it's about 25%, 25-odd percent of our premium. It's more in terms of number of policies. On the PoSP front, it's almost half. So half our motor business would be TP. I will let Dhruv talk about the top 100, how he's going to reduce the percentage of business coming from the top 100. But I just want to tell you that in terms of profitability versus scale, we are totally focused on scale. I think we are happy to invest money behind the business as long as it's an investment. I think investment versus expense are 2 different things. As long as we are investing in capabilities and serving our partners better, that's something that we will continue to do. And we definitely believe that scale is the most important criteria for our PoSP business. Over to Dhruv.

I think reducing the dependence on the top 100, which is currently at about 16%, I think the only way to do it is spread more and more. Today, if we look at -- and I'm not sure if the numbers were published, we are -- there are roughly about, give or take, about 12 lakh GI agents, and we cater to roughly about 1.2 lakh to 1.4 lakh in a quarter, and we have to take this higher. We have to increase the number of partners working with us. But yes, it's a slow process because the productivity of the partners is lower. It will take time, but the whole idea is that how can we capture a large share of the market as well as go towards more Tier 3, Tier 4, where the productivity may be lower, but the number of partners are higher. So I think to add to what Sarbvir is saying, I think the focus is increasing scale.

The focus is clearly increasing scale. I think both our core business and our overall business benefit from that scale, and we would keep the focus on that.

And Sarbvir, if possible, could you give us some color around the impact that there could be on the motor TP business because of this extension of the policy period?

I think, Supratim, let's see how it goes. As you can imagine, what will happen is that the brand-new ticket sizes will go up because of this. That will help people who sell more brand-new insurance. For us, the really big opportunity could be what was in the judgment around the enforcement. So if tomorrow, the enforcement goes up, so as we saw in 2019, when the Motor vehicle Act was enacted, those particular 2 months, I think the business just went through the roof. And so if the enforcement is super high as per the judgment, I'm sure you read the details, if those cameras and fuel is not sold to people without third-party insurance, et cetera, then I can -- that could be a very meaningful jump for our business. But I think let's wait and see. I wouldn't say anything on that yet.

Next question is from the line of from Jayant Kharote from Axis Capital.

Hello, am I audible?

Yes.

Yes, Jayant, you are audible.

Yes. First question is on the Tier 2, Tier 3 opportunity on the online business, not the PoSP business. How has the mix of Tier 2, Tier 3 markets grown in our online business over the last few years? And what would be the strategy to sort of accelerate that mix over the next 3 to 5 years? That is the first question. I'll come with the second and the third.

So Jayant, I think it's very -- we are going the same way as the country is going. And I think Tier 2, Tier 3 now, depending on the business on the direct side, account for somewhere between 65% and 70% of the business. And this part is growing faster than the bigger cities. Having said that, for us, the bigger cities also continue to grow. So it's not that one is growing and the other is declining or something. Both are growing. The growth rate is faster. Actually, if you ask me, the dynamic that has played out for us on the B2C business in the last 3 years is a different one, which is that the South has grown much faster than the North and the West. So the -- yes, Tier 2, Tier 3 have grown, but the more dominant narrative or the trend has been the South growing. But yes, we are also seeing the same thing that...

Which was a bit specific to us also because we were over-indexed to the North in the beginning.

Correct. Correct. Yes.

And when you say 60%, 65%, you're B30, right, not B10?

Yes. I mean, I'm not familiar with this terminology. But basically, I'm saying if you leave out the top 10 cities. After that, we consider Tier 2, Tier 3. Those cities are about 65% to 70% of our business.

Understood. The second question was on Paisabazaar. I'm sorry to bring this question up every quarter. If you can help us how the EBITDA has fared this quarter because the full year expectation that we had when -- in our analyst meet discussions was fairly sizable number. So how are we faring on that one in 1Q?

What did we say? If you can remind me, what did we say was the annual number approximately?

Approximately INR 100 crores?

Yes, yes, I don't think it will be INR 100 crores. I think we'll be maybe at about half of that.

Okay. But this quarter has been breaking even.

Look, in the scheme of things, quite immaterial in the big scheme of things. But yes, it will be about half of that.

Have you broken even in this quarter?