Going ahead, NIC is committed to its stake holders and the improved financial performance is an indicator for the company to achieve profitable growth, T Babu Paul, executive director, NIC

Kolkata: State owned National Insurance Company(NIC) has recorded a 80 per cent year-on year(Y-o-Y) rise in its net profit to Rs 81 crore in Q2FY25.

There has been a turnaround by the company in key parameters in recent times as it had posted Rs 45 crore net profit during the same period in the last fiscal.

The total gross premium income earned by the company, which is currently functioning with a great deal of financial constraints, was Rs 7,876 crore in the reporting quarter as compared to Rs 8,387 crore in the corresponding quarter of previous fiscal.

“NIC has been pursuing the objective of profitable growth and the degrowth of six per cent in gross premium is mainly due to a major shifting of renewal to the subsequent quarter,” said T Babu Paul, executive director, NIC.

“There has been a significant improvement in controlling the underwriting losses in the Health Portfolio with the Incurred Claims Ratio(ICR) improving from 91 per cent in Q2FY24 to 84 per cent in the Q2 FY25,” said Paul.

ICR is the ratio of claims paid to the premium received.

The company had a combined ratio of of 128 per cent and underwriting losses of Rs 2036 crore in the reporting quarter.

Substantially contributing to the profitability of the overall Q2 financial results,NIC’s investment income up to the 2nd quarter for FY25 rose 43 per cent YoY to Rs 2,268 crore, compared to Rs 1,582 crore in the same period last year .

Health Insurance continued to be the major premium earner comprising about 45 per cent of the total product portfolio whereas Motor Insurance contributed to 29 per cent added Paul.

There has been reasonable growth in the other segments including Fire Insurance, Marine Insurance and Miscellaneous business contributing to a healthy portfolio distribution for the company, he explained.

The company has also made a provision of around Rs 300 crore for pending wage arrears.

The insurer’s asset under management (AUM) has risen to Rs 28,839 crore in the H1FY 25 from Rs 27,451 crore H1FY24.

Going ahead, NIC is committed to its stake holders and the improved financial performance is an indicator for the company to achieve profitable growth, stated Paul.

In a bid to protect its margin, the general insurer has raised its premiums in some f its retail portfolios including Health, Motor, and personal line of business, informed Paul.

In November, NIC has renewed one of the large group health insurance policies from Indian Banks’ Association(IBA),for the fourth time , covering 21 lakh lives earning a hefty premium of over Rs 2200 crore.