Synopsis:
New India Assurance (NIACL) jumped 10% following its impressive Q1 FY26 results. The Gross Written Premium (GWP) climbed by 13.1% year-on-year, reaching Rs 13,333 crore, while net profit soared by 80% to Rs 391 crore. Their market share also improved to 15.5%, driven mainly by the Health and Fire segments.
With a market capitalization of Rs 30,587 crores, the shares of New India Assurance Company Ltd are currently trading at Rs 186 per share, down by 39 percent from its 52-week high of Rs 302.80. Over the past five years, the stock has delivered a return of 65 percent.
Q1 Highlights
In Q1 FY26, the company reported a Gross Written Premium (GWP) of Rs 13,333 crore, marking a 13.1 percent increase compared to Rs 11,788 crore in Q1 FY25. The standout performer was the Health & Personal Accident segment, which contributed Rs 6,692 crore, reflecting a growth of 14.15 percent YoY.
The Fire segment saw the highest growth rate at 19.95 percent, followed closely by Others at 16.80 percent. On the other hand, Crop growth was quite modest at just 0.8 percent. The Motor segments, including OD and TP, experienced moderate increases of 6.45 percent and 3.81 percent respectively, while Marine grew by 9.48 percent.
Regarding its profitability, the company reported an 80 percent net profit growth to Rs 391 crore in Q1 FY26, compared to Rs 217 crore in Q1 FY25. Additionally, on a QoQ basis, it surged by 13 percent from Rs 347 crore.
Additionally, its Asset Under Management (AUM) also grew by 2 percent to Rs 1,00,802 crore in Q1 FY26 from Rs 98,769 crore in Q1 FY25. Its Solvency ratio also improved from 1.83x to 1.87x.
A higher solvency ratio is beneficial because it indicates that an insurance company is financially strong and stable, with enough capital to meet its future obligations.
Taking a closer look at the Incurred Claims Ratio (ICR), we see that it climbed to 99.76 percent in Q1 FY25-26, up from 95.98 percent last year. This suggests that claim payouts are on the rise.
The Motor OD segment recorded the highest ICR at 116.35 percent, followed closely by Motor TP at 105.09 percent, both of which indicate some strain on underwriting margins. On the other hand, Fire kept the lowest ICR at just 11.44 percent.
The Incurred Claims Ratio (ICR) represents the percentage of claims that have been paid out compared to the total premiums collected. A higher ICR signals more payouts, which can lead to lower profitability.
In the overall general insurance market of Rs 79,301 crore, NIACL holds a total premium of Rs 12,299 crore, translating to a market share of 15.5 percent (up from 14.65% YoY). The company bagged the highest share in the Health & PA segment at 18.9 percent, followed by Fire (16.5 percent), and Marine (16.2 percent). Other segments like Miscellaneous (15.3 percent) and Others (15 percent) also show strong presence. The Motor segment remains the weakest with a market share of only 9.92 percent.
The New India Assurance Company Limited is a general insurance provider that operates not just in India but also internationally. They offer a diverse array of insurance products, such as motor, health, fire, marine, property, personal accident, liability, and engineering insurance.
Additionally, the company caters to rural and agricultural needs, providing coverage for crops, cattle, poultry, and even solar pump sets. They also offer microinsurance, home and content insurance, and protection for animal-drawn carts and bicycles. Plus, they engage in government schemes and provide reinsurance and bancassurance services.
Written by Satyajeet Mukherjee
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