The underwriting blowout has virtually wiped out industry profitability. Aggregate net profit plunged 92% year-on-year to just Rs 953 crore in FY26, while the industry’s average combined ratio deteriorated sharply from 112.61% in FY25 to 117.83%, underscoring the widening gap between premium growth and underwriting performance.

Mumbai:In a worrisome development, India’s general insurance industry has suffered a sharp deterioration in underwriting performance, with aggregate underwriting losses surging a record 54% year-on-year to Rs 46,632 crore in FY26, with nearly 10% growth in gross written premium (GWP) to around Rs 3.40 trillion.

The underwriting blowout, during the year, has virtually wiped out industry profitability. Aggregate net profit plunged 92% year-on-year to just Rs 953 crore in FY26, while the industry’s average combined ratio deteriorated sharply from 112.61% in FY25 to 117.83%, underscoring the widening gap between premium growth and underwriting performance.

The deterioration was particularly severe among the four state-owned multiline general insurers. Led by New India Assurance(NIA) and United India Insurance, both have underwriting losses of over Rs 8,000 crore, their combined underwriting losses jumped 68% to around Rs 30,900 crore during FY26.

NIA, the largest Indian general insurer, had a record global gross written premium of approximately ₹47,174 crore in FY 26.

Although, New India Assurance posted a net profit of Rs1,384 crore, the four PSU general insurers collectively slipped into a loss of around Rs 10,000 crore, compared with a combined net profit of about Rs 900 crore a year earlier.

Private multiline insurers also remained deep in underwriting losses. Led by IndusInd General Insurance(Rs 1650 crore), their aggregate underwriting deficit increased 12% to Rs 13,657 crore in FY26. However, stronger investment income and operating performance helped private insurers maintain profitability, with aggregate net profit rising 5% to Rs 8,580 crore, led by ICICI Lombard General Insurance.

However, none of the private sector general insurance companies including Bajaj General Insurance,have made any underwriting profit during the reporting year.

The standalone health insurance segment faced an even sharper underwriting squeeze. The seven standalone health insurers recorded a 55% increase in underwriting losses to Rs 2,544 crore, led by Care Health Insurance.

Star Health and Allied Insurance’s profitability provided critical support to the segment, which nevertheless managed to remain marginally profitable with aggregate net earnings of around Rs 409 crore. ManipalCigna Health Insurance, with GWP of about Rs 2,013 crore, reported the segment’s largest loss at Rs 406 crore.

In contrast, the two state-owned specialised insurers—Agriculture Insurance Company of India (AIC) and ECGC—continued to generate underwriting profits.

Both also delivered robust bottom-line performances. AIC reported a net profit of Rs 935 crore, while ECGC posted net earnings of Rs 1,277 crore in FY26.

Analysts said the FY26 numbers highlight a growing structural challenge for India’s general insurance sector.

“ In the absence of major market-changing insured losses or natural catastrophe events in FY 26, this kind of underwriting losses and low profitability in the industry during the year is a worrisome development and needs regulatory scrutinies,” said analysts.

With deteriorating combined ratio, insurers are increasingly dependent on investment income to sustain overall profitability, analysts have raised questions over pricing adequacy, claims inflation, risk selection and the sustainability of current growth rates.