The study provides valuable insights for insurance company management in formulating optimal capital structure strategies and assists investors in evaluating financial performance. It also contributes to existing literature by offering empirical evidence from the Indian insurance sector and highlights the need for maintaining financial stability while maximizing profitability. The research is based on secondary data collected from the annual reports of HDFC Life Insurance, IRDAI publications, and financial databases over a selected study period. Ratio analysis, correlation analysis, and multiple regression techniques are employed to assess the effect of capital structure on profitability. The findings indicate that capital structure has a significant influence on profitability, with an optimal mix of equity and debt contributing positively to financial performance. Excessive leverage, however, is found to adversely affect profitability due to higher financial risk and regulatory constraints in the insurance industry. Capital structure is a crucial financial decision that significantly influences a firm’s profitability and long-term sustainability, particularly in the highly regulated insurance sector. The present study examines the impact of capital structure on the profitability of Indian insurance companies, with special reference to HDFC Life Insurance Company Ltd. The study aims to analyze the relationship between capital structure variables—such as debt–equity ratio, solvency ratio, and leverage—and profitability indicators including return on assets (ROA), return on equity (ROE), and net profit margin.