Devesh Srivastava, CMD, GIC Re announcing company’s results at a press conference in Mumbai on Friday
The reinsurer had a record net profit of Rs 1,795 crore during Q4 FY 2021-22 as compared to a loss of Rs 28.48 crore in the year ago period
Indicating GIC Re’s strenuous efforts to keep losses under check, by overhauling business portfolios, has started paying dividend, the 14th largest global reinsurer’s Combined Ratio(CR) has drastically fallen to 74.30 per cent in Q4 FY2021-22 from 126.54 per cent in the year ago period
Mumbai:
Delivering a historical performance amidst Covid-19 disruptions in Q4 fy 2021-22, state owned GIC Re has achieved a Combined Ratio(CR) of 74.30 per cent leading to an underwriting profit of Rs 2314 crore during the period.
This is for the first time GIC Re has recorded a positive CR, most critical indicator of profitability for a re/insurer and underwriting profit in any quarter. Any CR of below 100 per cent means a re/insurer has managed its claims within the premium income.
GIC Re had an underwriting loss of Rs 2,371 crore in Q4 FY 2020-21.
The reinsurer had a record net profit of Rs 1,795 crore during Q4 FY 2021-22 as compared to a loss of Rs 28.48 crore in the year ago period.
The company have declared interim dividend at the rate of Rs 2.25 per equity share (on face value of Rs 5/- each) and 8th June 2022 has been fixed as record date for payment of interim dividend.
Indicating GIC Re’s strenuous efforts over last two years to keep its losses under check, by overhauling its business portfolios, has started paying dividend, the 14th largest global reinsurer’s Combined Ratio(CR) has significantly fallen to 74.30 per cent in Q4 FY2021-22 from 126.54 per cent in the year ago period.
The listed Indian reinsurer has recorded a gross premium of Rs 10,303 crore in the reporting quarter as compared to Rs 10,240 crore in the year ago period. Almost 35 per cent of its premium has come from international markets.
The third largest Asian reinsurer has seen its incurred claims falling by more than half to Rs 4,334 crore in Q4FY 2021-22 as compared to Rs 10,857 crore in the year ago period.
“In the past few years, GIC Re suffered huge underwriting losses in the wake of catastrophic events(CAT Events). This had led to hit the balance sheet hard and ate away the investment income. After actualising the situation GIC Re has restructured different segments and curtailed few businesses which generate losses,” said Devesh Srivastava, CMD, GIC Re.
Restructuring is underway in terms of business portfolio composition and achieving pricing adequacy at contract level. This has involved process changes across the organization. The measures so far have focused on property and agri. This renewal, we have also touched upon other classes, he added.
The reinsurer had an investment income of Rs 2,826 crore, up 25 per cent year on year, in the reporting quarter as compared to Rs 2,271 crore in the year ago period.
GIC Re’s solvency ratio has risen to 1.96 as on 31.03.2022 as compared to 1.74 as on 31.03.2021.
GIC Re’s performance in FY 2021-22
GIC Re’s gross premium, at Rs 43,208.46 crore, has fallen almost 10 per cent y-o-y in FY 2021-22.
GIC Re’s net profit marginally has risen by around 5 per cent y-o-y to Rs 2,005.74 crore, in 2021-22 as compared to Rs 1,920.44 crore for FY 2020-21.
The reinsurer’s CR was at 112.08 per cent in FY 2021-22 as against 112.03 per cent in 2020-21.
During the year, the company’s CR has exceeded 100 per cent in all lines of business, Fire (109.70 per cent), Motor (107.65 per cent), Health (116.11 per cent),Crop(103.68),Cargo(120.39 per cent), Hull(121.21) and Life(214 per cent).
Adjusted CR of GIC Re was at 93.11 per cent in for FY 2021-22 as against 95.85 per cent in FY 2020-21.
Shedding its top line growth further by 8 per cent, GIC Re’s gross premium was at Rs 43,208.46 crore in Fy 2021-22 as compared to Rs 47,014.38 crore in FY 2020-21.
Except motor and life reinsurance portfolios, the reinsurer has cut down its exposure in all categories of business in FY 2021-22,
The company’s underwriting loss fell to Rs 4,266.11 crore in Fy 2021-22 over Rs 5,488.45 crore in FY 2020-21.
Its investment income rose to Rs 9,562.29 crore in FY 2021-22 as compared to Rs 8,820.86 crore in FY 20220-21
Solvency Ratio is 1.96 as on 31.03.2022 as compared to 1.74 as on 31.03.2021.
Total assets of the company are at Rs 144,887.37 crore at the end of FY 2021-22 as compared to Rs 1,34,661.22 crore at the end of FY 2020-21.
Net Worth of the company (without fair value change account) recorded at Rs 24,439.72 crore as on March 2022 as against Rs 22,452.34 crore as on March 2021.
Net Worth of the company (including fair value change account) recorded as Rs 55,657.73 crore on 31.03.2022 as against Rs 49,643.19 crore as on 31.03.2021.