General Insurance Corporation of India (GIC RE) reported a consolidated net loss of Rs 1035.54 crore in Q3 December 2019 (Q3 FY20) compared with net profit of Rs 377.34 crore in Q3 December 2018 (Q3 FY19).
Shares of GIC RE slumped 9.20% to Rs 240.20. It traded in the range of Rs 239.35 and Rs 255.50 so far during the day.
Total income of the general insurer rose 20.3% to Rs 10091.16 crore in Q3 FY20 over Q3 FY19. The company reported a pre-tax loss of Rs 950.50 crore in the third quarter of FY20 as against pre-tax profit of Rs 1021.38 crore in the same period last year.
GIC RE said that 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 31 December 2019 underwriting performance resulted in underwriting loss to the corporation.
Given the steps taken by the corporation in revising premium rates for fire segment based on Insurance Information Bureau statistics, the fire segment is now on a sound footing. 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.
Growth in Gross Premium Income of the company was 15.7% with premium of Rs 41,812.29 crore for the nine months ended 31 December 2019 (9M FY20) from Rs 36,148.65 crore in corresponding period of previous year.
International business grew 6.8% in 9M FY20 to Rs 10,547.53 crore, but its share to overall income declined to 25.2% from 27.3%, while the domestic business grew 19% to Rs 31,264.75 crore and its overall share in the total income pie to 74.8% from 72.7%.
Investment Income for 9M FY20 increased to Rs 5,216 crore as compared to Rs 4,802.45 crore for the nine months ended 31 December 2018 (9M FY19), showing a growth of 8.61%.
Net worth of the company (without fair value change account) recorded as Rs 19,350.67 crore on 31 December 2019 as against Rs 21,720.89 crore on 31 December 2018.
Total Assets increased by 7.66% from Rs 119,367.26 crore as on 31 December 2018 to Rs 1,28,509.76 crore as on 31 December 2019.
Incurred claims Ratio increased from 91.8% in the nine months ended 31 December 2018 to 99.1% in the nine months ended 31 December 2019.
Underwriting Loss recorded Rs 5903.60 crore in nine months ended 31 December 2019 as against loss of Rs 2,312.62 crore in corresponding period of previous year.
Combined Ratio is 115.76% for the nine months ended 31 December 2019 as compared to 107.62 % for the corresponding period of previous year.
Adjusted Combined Ratio is 104.97% for the nine months ended 31 December 2019 as compared to 96.96% for the corresponding period of previous year. Solvency Ratio stood at 1.51 as on 31 December 2019.
GIC's consolidated results includes results of its subsidiaries namely GIC Re South Africa, GIC Re Corporate Member, GIC Perestrakhovanie LLC and three associate companies which are Agriculture Insurance Corporation of India, GIC Re Bhutan Re and India International, Singapore.
GIC Re is the largest reinsurer in the domestic reinsurance market in India.
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