Claim ratios fall across all segments during quarter
MUMBAI: New India Assurance net profit for the second quarter ending September 30, 2019 improved by 61 per cent from Rs329 crore to Rs530 crore backed by a reduction in incurred claim ratio (ICR) across most segments during the quarter.
While the marine ICR dropped from 29.34 per cent year on year (YoY) for Q2, that of fire declined from 130.81 per cent to 87.83 per cent during the quarter.
Other segments are motor own damage (OD) whose ICR fell from 78.32 per cent to 76.61 per cent), Motor TP (93.67 per cent to 92.48 per cent), health (from 100.40 per cent to 98.14 per cent), personal accident (174.16 per cent to 133.27 per cent) and crop insurance declining from 273.07 per cent to 136.19 per cent year on year during the quarter under review.
The company witnessed growth in all portfolios during the quarter except in personal accident insurance, which saw a more than 50 per cent contraction in volume from Rs167.88 crore to 82.52 crore. At the same time, during the period, the crop insurance saw a surge in volume from Rs519.07 crore to Rs1328.37 crore, representing a 155.91 per cent growth.
Atul Sahai (seen in the picture), chairman and managing director (CMD) of the company said the results are heartening given the challenging operating environment the company had to go through.
“These results are despite a slow-down in motor segment and also against the fact that the company incurred significant losses to the tune of Rs335 crore during the quarter due to floods in different parts of the country.
Provisions towards bad debts and diminution in value of certain equity investments have further impacted profitability by Rs40 crore in the quarter.
Foreign business of the company that controls 14.18 per cent of the market in India, continued to be profitable during the quarter. The solvency ratio of the company, at 2.08 remains higher than the IRDAI mandated control level solvency ratio of 1.5.
“The company continues its focus on reducing the loss ratio and combined ratio and delivering better results going forward,” the CMD said.