State owned GIC Re at Rs 41,812.29 crore has recorded a 15.7 per cent growth in its premium in the nine months ended Dec 31,.2019 as against Rs 36,148.65 crore in corresponding period of previous year.
However, on account of provisioning for investments and increase in agriculture losses, the reinsurer posted a net loss of Rs 1,556.50 crore in nine months period ended Dec 31 2019 as compared to profit after tax of Rs 1,620.94 crore for the nine months ended 31.12.2018.
GIC Re declared its financial performance for the nine months ended December 2019, at the board meeting of the company held in Mumbai today.
The company recorded loss before tax of Rs 1,547.06 crore in nine months ended Dec 31,2019 as against profit before tax of Rs 2,239.74 crore in the corresponding period of previous year.
Against the backdrop of severe claims worldwide during the year 2019-20, higher agriculture claims and flood claims in various parts of India, in the quarter ended Dec 31, 2019 underwriting performance resulted in underwriting loss to the corporation, said GIC Re .
Coupled with global overall hardening of pricing environment the financial results for Q4 is expected to improve. Alongside, the corporation also pruned the portfolio based on more stringent profitability criteria, added GIC Re.
Given the steps taken by the corporation in revising premium rates for fire segment based on Insurance Information Bureau(IIB) statistics,the fire segment is now on a sound footing, said GIC Re.
After two years of record catastrophes globally in 2017 and 2018 together with alternative capital taking a pause in its deployment in reinsurance sector in 2019, the reinsurance market has shown significant signs of hardening during last few months. This will be fully reflected in GIC Re financials in next 4-8 quarters, said GIC Re
The GIC Re’s underwriting losses recorded Rs 5903.60 crore in the reporting period as against loss of Rs 2,312.62 crore in corresponding period of previous year.
The Combined Ratio(CR), less than 100% of CR makes re/insurer profitable, of the company is 115.76 per cent for the reporting period as compared to 107.62 per cent for the corresponding period of previous year. Adjusted Combined Ratio of the company is 104.97 per cent for the reporting period as compared to 96.96 % for the corresponding period of previous year.
The GIC Re’s investment Income for the reporting period increased to Rs 5,216 crore as compared to Rs 4,802.45 crore for the nine months ended Dec 31, 2018, showing a growth of 8.61 per cent .
Net Worth of the company (without fair value change account) recorded as Rs 19,350.67 crore on Dec 31, 2019 as against Rs 21,720.89 crore on Dec 31, 2018.
GIC Re’s total assets increased by 7.66 per cent from Rs 119,367.26 crore as on Dec 31,2018 to Rs 1,28,509.76 crore as on Dec 31,2019.
Incurred claims Ratio of the company increased from 91.8 per cent in the nine months ended Dec 31, 2018 to 99.1 per cent in the nine months ended Dec 31,2019.
The company had a solvency ratio of 1.51 as on December 31, 2019.