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    ICICI Lombard General Insurance Company Limited

    ICICIGI
    Financial Services·15 Jul 2026
    Management Summary

    ICICI Lombard reported a challenging Q1 FY27 with significant declines in PBT and PAT, primarily due to large fire losses and a substantial provision for a Supreme Court judgement impacting Motor TP. Despite these headwinds, the company demonstrated strong growth in its Retail Health and Motor segments, driven by digital adoption and operational efficiencies. Management emphasized its conservative reserving practices and the expectation of industry-wide actions to address pricing adequacy in Motor TP.

    Highlights

    5

    • Company GDPI grew 7.5% in Q1 FY27 to ₹83.18 billion, driven by retail lines.

    • Retail Health business grew 69.5% in Q1 FY27, significantly outperforming the industry's 31.6% growth, and market share improved to 4.5%.

    • IL TakeCare app achieved 22.1 million downloads, with GWP from the app growing to ₹1,545.3 million in Q1 FY27 from ₹932.0 million in Q1 FY26.

    • Digital interactions increased to 624K in Q1 2027 from 214K in Q1 2026, with digital contribution rising to 69.0% from 36.0%.

    • Solvency ratio stood strong at 2.71x as of June 30, 2026, exceeding the minimum regulatory requirement of 1.50x.

    Concerns

    4

    • Profit Before Tax (PBT) de-grew by 46.1% to ₹5.36 billion in Q1 FY27 compared to ₹9.94 billion in Q1 FY26.

    • Profit After Tax (PAT) de-grew by 46.0% to ₹4.03 billion in Q1 FY27 compared to ₹7.47 billion in Q1 FY26.

    • Combined Ratio (CoR) deteriorated to 107.2% in Q1 FY27 from 102.9% in Q1 FY26, impacted by ₹0.63 billion in fire losses and a ₹1.65 billion provision for Motor TP judgement.

    • Commercial segment reported a de-growth of 8.6% in Q1 FY27, primarily due to significant pricing pressure in Fire insurance, which saw a de-growth of 27.8%.

    Key financials

    Single quarter

    06 metrics
    1. 01Gross Direct Premium Income$83.18B+7.5%YoY
    2. 02Combined Ratio107.2%
    3. 03Profit Before Tax$5.36B-46.1%YoY
    4. 04Profit After Tax$4.03B-46%YoY
    5. 05Return on Average Equity9.6%

    Segment breakdown

    Commercial Segment
    -8.6% Growth-27.8% Fire Insurance Growth33.6% SME Business Proportion
    Motor Segment
    14.0% Growth10.5% Market Share33.6% New Vehicle Sales Growth
    Health Segment
    24.9% Growth69.5% Retail Health Growth4.5% Retail Health Market Share53.4% Long Term Book Contribution (Retail Health)16.3% Group Health Growth10.3% Group Health Market Share
    List

    Capital allocation

    1
    high confidence
    CategoryHeadline
    Liquidity

    Liquidity disclosed

    Solvency ratio was at 2.71x as at June 30, 2026, well above the minimum regulatory requirement of 1.50x.

    Guidance & targets

    7
    CategoryTargetPriority
    Profitability
    Motor TP loss ratio increase (industry)
    12-15%
    		High
    Profitability
    Industry Motor Combined Ratio
    128.0%
    		High
    Profitability
    ICICI Lombard Motor Combined Ratio
    106.6%
    		High
    Profitability
    Industry Fire Loss Ratio Range
    65-70%
    		Medium
    Operational Efficiency
    Call Centre NPS
    76
    		High
    Digital Adoption
    Digital Contribution
    69.0%
    		High
    Industry Health
    Industry Solvency Ratio
    1.56x
    		High

    What to watch in Q2 FY27

    5

    Outcome of Motor TP Judgement Revision Petition

    next quarter
    CurrentGeneral Insurance Council filed revision petition.
    TargetClarity on the final impact and industry-wide response.

    Why it matters

    The outcome will determine the long-term financial impact on Motor TP loss ratios and potential for premium rate adjustments.

    I think at this point of time, the General Insurance Council has also kind of filed a revision petition against the judgement. Obviously, it is subjudice at this point of time. And obviously, we will wait and see in terms of how the impact plays out.

    Risks & concerns

    4
    RiskSeverity

    Motor TP Judgement Impact

    Supreme Court judgement on 'Loss of Domestic Care' expected to increase industry Motor TP loss ratio by 12-15%; company provisioned ₹1.65 billion. — Both acknowledged

    high

    Competitive Pricing in Commercial/Fire Segment

    Significant pricing pressure led to 8.6% de-growth in Commercial segment and 27.8% in Fire insurance in Q1 FY27, though June saw some improvement. — Management acknowledged

    medium

    Elevated Health Claim Incidences

    Health segment experienced elevated claim incidences in Q1 FY27, an industry-wide trend often linked to monsoon season. — Management acknowledged

    medium

    Macroeconomic Risks (El Nino, Geopolitical Tensions)

    El Nino conditions on monsoon and continuing geopolitical tensions are risks that may influence growth momentum. — Management acknowledged

    low

    Q&A highlights

    8

    “I think we have done a holistic assessment of all the exposures that we have on the books as at June 30. This includes not only just the book that has been underwritten for Quarter 1, we have also looked at the book that we have underwritten even for in terms of the exposures that we have for the past periods and I am just reiterating basis all of that from a prudence and conservatism standpoint.”

    Clarifies that the ₹1.65 billion provision is a holistic assessment covering the entire book up to June 30, not just Q1 business, and reflects the company's conservative reserving philosophy.

    asked by Sanketh Godha

    2 min read5 chapters

    Detailed Narrative

    01

    Q1 FY27 Financial Performance Overview

    ICICI Lombard reported a Gross Direct Premium Income (GDPI) of ₹83.18 billion in Q1 FY27, marking a 7.5% growth year-on-year, compared to the industry's 10.9%. However, Profit Before Tax (PBT) de-grew by 46.1% to ₹5.36 billion, and Profit After Tax (PAT) de-grew by 46.0% to ₹4.03 billion. The Combined Ratio (CoR) deteriorated to 107.2% from 102.9% in Q1 FY26, primarily due to two large fire losses totaling ₹0.63 billion and a ₹1.65 billion provision for a Supreme Court judgement on Motor TP. Excluding these impacts, the CoR would have been 102.3%.

    02

    Impact of Supreme Court Judgement on Motor TP

    A recent Supreme Court judgement on June 11, 2026, recognized 'Loss of Domestic Care' for homemakers, with an estimated impact of increasing the industry's Motor TP loss ratio by 12% to 15%. In line with its prudent reserving practices, ICICI Lombard made a provision of ₹1.65 billion in Q1 FY27, which contributed 2.8% to the combined ratio. The General Insurance Council has filed a revision petition against this judgement, and the company awaits further clarity on its long-term implications and potential premium rate revisions.

    03

    Segmental Performance Highlights

    The Commercial segment faced significant pricing pressure, leading to an 8.6% de-growth in Q1 FY27, with Fire insurance de-growing by 27.8%. In contrast, the Motor segment grew by 14.0%, maintaining a market share of 10.5%, and new vehicle sales growth significantly outperformed the industry at 33.6%. The Health segment was a strong performer, growing 24.9% against an industry growth of 20.1%, with Retail Health growing 69.5% and its market share improving to 4.5%.

    04

    Operational Efficiency and Digital Adoption

    ICICI Lombard continued its focus on operational efficiency and digital adoption. The IL TakeCare app saw its downloads reach 22.1 million by June 30, 2026, with Gross Written Premium (GWP) from the app increasing to ₹1,545.3 million in Q1 FY27. Digital interactions surged to 624K in Q1 2027 from 214K in Q1 2026, increasing digital contribution to 69.0%. The company's Call Centre NPS also improved to 76 in Q1 FY27 from 60 in Q1 FY26, reflecting enhanced customer service.

    05

    Industry Trends and Competitive Landscape

    The domestic economic momentum remained steady, with strong growth in retail vehicle sales and bank credit. However, the general insurance industry's Combined Ratio deteriorated to 117.8% in FY26, and industry solvency declined to 1.56x by March '26 from 1.75x in March '25. Management noted that intense competitive pricing, particularly in the Fire segment, is unsustainable given the industry's solvency levels, expecting a recalibration in pricing aggression in future quarters.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.