Crisil Ratings downgrades United India Insurance rating from AA to AA-

Reaffirms rating for New India, National Insurance

In a slew of rating actions on state-owned insurers, Crisil Ratings has downgraded the corporate rating of United India Insurance Co from "AA" to "AA-" and revised the outlook from "stable" to "negative" on the corporate credit rating of National Insurance Co. The rating downgrade and outlook revision factor in the lack of improvement in their solvency profile.

 

The agency reaffirmed the "AAA" rating of The New India Assurance Company and the "AA-" rating of National Insurance Co.

 

As for United India, Crisil said in a statement that the solvency ratio continued to remain below the regulatory stipulation. The company’s weak underwriting performance continues to constrain its earnings profile, thereby imposing pressure on its solvency position. United India’s underwriting performance remained weak, with the combined ratio staying high between 120 per cent and 129 per cent during the last three to four quarters. The average claims ratio ranged between 92 per cent and 96 per cent during the last few quarters, the rating agency added.

 

 

Following a sustained period of underperformance, United India Insurance has begun to exhibit signs of profitability in terms of investment income, reversing a negative trend that has persisted over the past six to seven financial years. It posted a net profit of Rs 27 crore during the nine months ended March 2025 as against a net loss of Rs 804 crore during FY24, it added.

 

Referring to National Insurance, Crisil said its solvency ratio has remained below the regulatory stipulation for a prolonged period. The reported solvency ratio declined from 0.63 times as on March 31, 2022, to negative 0.53 times (excluding the balance in the fair value change account) as on December 31, 2024. The underwriting performance remains weak, as reflected in a combined ratio of 127.5 per cent for the first nine months of FY25 and 126.9 per cent for the full FY24. Its net profit for 9M FY25 was Rs 29 crore compared to a loss of Rs 218 crore in the same period in FY24.

 

As for New India Assurance, Crisil said the rating factors in the company’s leadership position in the Indian general insurance industry, its sound investment portfolio, healthy capitalisation and solvency position.