The New India Assurance, the only profit-making public sector general insurer, reported a net loss of ₹257 crore for the first quarter of FY27 as a slump in property insurance premium, driven by aggressive underpricing of fire insurance by general insurers to gain volumes, hurt earnings. The insurer had reported a net profit of ₹391 crore in the year-ago period.
Gross written premium (GWP) of the country’s largest general insurer remained largely flat at ₹13,720 crore during the April-June quarter, compared with ₹13,334 crore in the corresponding period last year, resulting in muted growth.
Girija Subramanian, Chairman-cum-Managing Director, The New India Assurance, said Q1FY27 was a challenging quarter for the Indian general insurance industry. “The insurance industry property premium crashed by 27.8% during the quarter and Q1FY27 being a property heavy quarter for New India Assurance, our overall GWP growth was muted at 2.9%,” she added.
Fire insurance premium fell 27% year-on-year to ₹1,971.34 crore. Health insurance premium, the insurer’s largest portfolio, remained largely flat at ₹6,819 crore, compared with ₹6,691 crore in the same quarter last year.
The insurer’s combined ratio deteriorated to 121.44% from 116.16% a year ago, indicating that it paid ₹121 in claims and operating expenses for every ₹100 earned as premium.
“The Motor Third Party line of business continued to be under pressure as there was no premium increase and the claim inflation pressure continued. The significant spike in Motor TP loss ratio had a severe adverse impact on the results,” Subramanian said. The incurred claims ratio in the motor third-party segment stood at 122.20%, implying that the insurer paid ₹122 in claims for every ₹100 collected as premium.
The insurer’s solvency ratio remained healthy at 1.80 times. The company’s investment assets on a market value basis stood at a healthy ₹99,980 crore. “Going forward, we will continue our efforts to change the business mix in favor of retail and MSME with the focus on newer product lines where competitive intensity is lower,” Subramanian said.
