GIC Re reports Rs 12,405.68cr gross premium income for Q1 FY25

General Insurance Corporation of India (GIC Re), India’s largest reinsurer, has unveiled strong financial results for Q1 FY25, ending 30th June 2024. The announcement was made at the company’s Board Meeting in Mumbai, showcasing significant improvements in several key financial metrics.

Key Financial Highlights

GIC Re’s gross premium income surged to ₹12,405.68 crore for Q1 FY25, a notable increase from ₹8,917.71 crore recorded in the same quarter of the previous fiscal year. This growth reflects the company’s expanding footprint in the reinsurance market, driven by increased demand for coverage across various sectors.

The underwriting loss reduced to ₹1,288.53 crore from ₹1,557.44 crore in Q1 FY24. This improvement indicates more effective risk management and pricing strategies that have better aligned the company’s underwriting practices with market conditions.

Investment income for the quarter rose to ₹2,758.99 crore, compared to ₹2,559.31 crore in Q1 FY24. This increase is attributed to GIC Re’s strategic investment decisions and a favourable investment climate.

The solvency ratio improved to 3.36 as of 30th June 2024, up from 2.88 the previous year. This enhancement demonstrates the company’s strengthened ability to meet future obligations and maintain a robust capital position.

GIC Re’s profit before tax surged to ₹1,393.16 crore, up from ₹935.18 crore in Q1 FY24. Profit after tax also rose significantly to ₹1,036.36 crore from ₹731.79 crore. These gains reflect the company’s improved operational efficiency and profitability.

Total assets grew to ₹1,86,552.46 crore from ₹1,63,928.08 crore, illustrating the company’s expanding asset base. The net worth, excluding fair value changes, increased to ₹38,635.23 crore from ₹32,984.27 crore. When including fair value changes, net worth climbed to ₹85,926.02 crore, up from ₹69,650.29 crore.

The combined ratio improved to 109.60% from 118.47%, indicating better expense management. The adjusted combined ratio also saw a decrease to 92.97% from 95.97%, reflecting enhanced operational efficiencies.

Consolidated Financial Performance

On a consolidated basis, GIC Re’s results were equally robust. Consolidated gross premium income rose to ₹12,589.42 crore from ₹9,206.79 crore. The group’s investment income increased to ₹2,788.85 crore from ₹2,573.79 crore.

Consolidated profit before tax climbed to ₹1,490.12 crore from ₹1,153.57 crore, while profit after tax surged to ₹1,400.65 crore from ₹977.65 crore. The incurred claims ratio improved to 89.17% from 92.60%, highlighting effective claims management.

The group’s net worth, excluding fair value changes, increased to ₹42,164.61 crore from ₹36,151.68 crore, underscoring the overall strength and stability of the group’s financial position.

Industry Insights and Expert Opinion

Analysts view these results positively, noting GIC Re’s solid market position and operational effectiveness. The company’s ability to grow premium income while enhancing profitability and maintaining a healthy solvency ratio indicates strong strategic management.

GIC Re’s performance aligns with broader industry trends where companies leverage technological advancements and data analytics to optimize underwriting and investment strategies. The company’s focus on expanding its market presence and improving operational efficiency positions it well for sustained growth.