The New India Assurance Company Limited — Q3 FY26 earnings call

Call held 2 Feb 2026

Management summary

New India Assurance reported a strong Q3 FY26 with global gross written premium growing 8.37% to ₹11,680 crore and net profit after tax increasing to ₹372 crore. The company's solvency ratio remained robust at 1.81x, and AM Best revised its outlook to positive. However, underwriting losses persisted at ₹1,736 crore, and the combined ratio increased to 117.98% primarily due to wage revision provisions. The company is strategically recalibrating its portfolio, focusing on profitable growth and improving claims ratios in key segments like Health.

Highlights

  • Global Gross Written Premium for Q3 FY26 was ₹11,680 crore, up 8.37% YoY.

  • Net Profit after Tax for Q3 FY26 increased to ₹372 crore, compared to ₹353 crore in the corresponding period last year.

  • Net Incurred Claim Ratio for Q3 FY26 improved to 90.77% from 94.49% last year.

  • Solvency ratio stood at 1.81x, comfortably above the regulatory requirement.

  • AM Best revised the company's outlook to positive from stable, reaffirming its B++ (Good) financial strength rating.

  • Domestic Gross Direct Premium Income grew by 13.71%, outpacing the industry growth of 8.69%.

Concerns

  • Underwriting loss for Q3 FY26 was ₹1,736 crore.

  • Combined ratio for Q3 FY26 increased to 117.98% from 116.28% last year, primarily due to wage revision provisions.

  • Marine Incurred Claim Ratio for Q3 FY26 was 119%, mainly due to large claims from two ship sinkings.

  • Fair value of change account reduced from ₹24,991 crore to ₹19,993 crore due to volatile market conditions and investment monetization.

Key financials

  1. Global Gross Written Premium ₹11,680 Cr +8.4%YoY
  2. Net Profit after Tax ₹372 Cr +5.4%YoY
  3. Net Incurred Claim Ratio 90.8%
  4. Combined Ratio 118%
  5. Solvency Ratio 1.81×
  6. Return on Equity 6.6%

What they filed

Q1 FY27: revenue up 1.5%, net profit down 159.5% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue10,786 10,703 11,664 11,719 13,450 +25%12,069 +13%12,544 +8%11,900 +2%
EBITDA140 98 426 189 -74 −153%206 +110%19 −96%-205 −208%
Net profit91 349 356 402 55 −40%380 +9%580 +63%-239 −159%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

SegmentGrowthICR
Product Mix (9M FY26)——
Distribution Mix (9M FY26)——
Health including PA (Q3 FY26)18.4%91%
Motor (OD & TP) (Q3 FY26)-0.89%108%
Fire (Q3 FY26)4.1%65%
Marine (Q3 FY26)19.5%119%

Capital allocation

high confidence
  • Liquidity Liquidity disclosed Solvency ratio for Q3 FY26 was 1.81x, up from 1.79x in Q2 FY26. Asset under management increased from ₹97,690 crore last year to ₹1,00,890 crore. Technical reserves increased from ₹52,536 crore to ₹56,745 crore. Net worth increased from ₹21,516 crore to ₹22,630 crore.
    The Solvency ratio up to Quarter 3 of 2025-2026 is 1.81 times as compared to 1.9 times of last year. However, it is notable that our Solvency ratio increased from 1.79 times in Quarter 2 of the current year to 1.81 times in Quarter 3 of the current year. Asset under management up to the quarter increased from Rs. 97,690 crore last year to Rs. 1,00,890 crore in the current year. Technical reserve up to the Quarter increased from Rs. 52,536 crore last year to Rs. 56,745 crore in the current year. Net worth up to the Quarter increased from Rs. 21,516 crore to Rs. 22,630 crore in the current year.

Guidance & targets

Growth

  • Motor segment growth Growth · next couple of quarters · Medium confidence upward trend
    I think with that coming, we should be able to make up for this growth in the next couple of quarters and at least it will show an upward trend is what we feel.

    — Ms. Girija Subramanian

  • Parametric Insurance traction Growth · coming year itself · Low confidence very big traction
    and therefore we see a very big traction for this in the coming year itself.

    — Ms. Girija Subramanian

Profitability

  • Health segment loss ratio Profitability · overall · Medium confidence 98%-100%
    On Health, we are aiming towards the loss ratio of around 98% - 100% overall.

    — Ms. Girija Subramanian

  • Motor segment loss ratio Profitability · overall · Medium confidence 103%-104%
    And for Motor also, we are trying to bring the loss ratio to around 103% - 104%.

    — Ms. Girija Subramanian

Taxation

  • Long-term tax rate (MAT) Taxation · from FY27 onwards · High confidence 17.42%
    It should be 17.42%, this is the MAT tax rate

    — Management

Market context

  • Return on Equity (ROE) Profitability · long-term · Medium confidence double digit
    Coming to ROE, right now it is in the single digit. The focus is to bring it up to the double digits and the primary lever will be to reduce the ICR. The results are quite sensitive to the swings in ICR with every percentage improvement creating quite a substantial improvement in the PAT. So, the aim is to improve the ICR in order to increase the profitability and thereby increase ROE. So, the first goal is to reach double digit ROE.

    — Management

What to watch in Q4 FY26

Family Pension Scheme (FPS) provision

Q4 FY26
Current Not yet included in Q3 FY26 results
Target Provision of ₹700-800 crore to be made

Why it matters

This is a significant pending expense that will impact Q4 FY26 profitability.

No. We will have to provide for this Rs. 700 crore - Rs. 800 crore, around that amount for the FPS in the last Quarter. Because it cannot be done before the notification comes out. Notification is yet to come out.

Risks & concerns

  • Large claims in Marine segment

    high

    Marine ICR for Q3 was 119% mainly due to large claims from two ship sinkings and resultant GA claims.

    Management acknowledged

  • Large claim in Aviation segment (Air India)

    high

    Aviation ICR for Q3 was 149% mainly due to an Air India claim.

    Management acknowledged

  • Competitive environment and pricing pressure in General Insurance

    medium

    The General Insurance industry operated in a competitive environment with selective pricing pressures and elevated claims experience in certain segments.

    Management acknowledged

  • Claims inflation

    medium

    Near-term challenges such as claims inflation and competitive intensity persist.

    Management acknowledged

  • Volatile market conditions impacting fair value of change account

    medium

    Fair value of change account reduced from ₹24,991 crore to ₹19,993 crore due to volatile market conditions and investment monetization for wage revision.

    Management acknowledged

Q&A highlights

8 direct
IBNR reserve release and its impact on claims ratio Direct
There is no particular decline per se as far as the core lines like Motor Third Party are concerned. However, what happens is there are lines like CROP, where initially you set aside reserve in the form of IBNR and later when the claims are actually either paid out, the correspondingly IBNR comes down. So, in this quarter, we did see quite a lot of payments on our CROP business which led to a reduction of IBNR. So, if you exclude CROP, there has been, the IBNR estimates has been pretty consistent with what it was during the first half. And there is no specific release per se as far as the results are concerned.

Clarifies that the IBNR decline is primarily due to CROP business payments, not a general release across core lines, providing context for claims ratio.

Asked by Rachna K

Investment book growth and yield improvement Direct
So, the yield has increased because of what Mary Madam has mentioned during the presentation. We have sold some bit of equity to realize profit and that is why the overall income on investment has increased. This is a one-time thing which is done for accommodating the wage revision expense.

Explains that the improved investment income is partly due to one-time equity sales to fund wage revision, indicating it might not be sustainable at the same level.

Asked by Rachna K

Motor segment growth trajectory and portfolio composition Direct
So, the growth on Motor is a little dented because of very strategic and very well-thought-out solutions for these loss-making accounts that we have been suffering from in Motor. So, definitely because of us exiting from many of these segments in Motor, wherever we found the losses exceptionally harsh, growth has come down and this will continue for some time. Maybe we are trying to work with new dealers and new partnerships. I think with that coming, we should be able to make up for this growth in the next couple of quarters and at least it will show an upward trend is what we feel.

Provides insight into the strategic decision to sacrifice Motor growth for profitability by exiting loss-making accounts and the expectation of an upward trend in a couple of quarters.

Asked by Shobhit Sharma

Wage cost arrears and family pension revision impact Direct
So actually, the wage revision calculation is around Rs, 2,500 crore on the whole. For the revenue account, it is around Rs. 1,677 crore which comes to the in-service employees. And for the arrears that have to be paid to them from August 2022. But the rest of it, that is around Rs. 642 crore on account of arrears that are payable to our retired employees. And that has been taken to the profit and loss account. So, this is the breakup. And as far as the FPS is concerned, 30% that is not yet been, that is from the date the notification comes through. Therefore, it has not been included here. And that would be roughly around Rs. 700 crore - Rs. 800 crore. So that should complete the whole thing for us as far as wage revision is concerned.

Clarifies the total wage revision impact (₹2,500 crore), its breakdown, and the pending provision for family pension (₹700-800 crore) which will impact the next quarter.

Asked by Shobhit Sharma

Sustainability of investment gains and future outlook Direct
So, the profit on sale that we have realized is around Rs. 4,236 crore. And of this, Rs. 2,000 crore is pertaining specifically to the wage revision provision. So, the balance is our regular trading activity, buy and sell activities according to the turning of the portfolio. ... Yes, sir. Our normal sale activity would be around Rs. 700 crore - Rs. 800 crore in the Quarter plus the additional that is required to set off the wage revision provision which will be known once the notification comes and when will be the provision is required to be made, we will be planning accordingly.

Distinguishes between one-time gains used for wage revision and regular trading activity, providing a clearer picture of sustainable investment income.

Asked by Shobhit Sharma

Tax rate for the current and future financial years Direct
No, this is because the advance tax is being paid, so because of that we do not need to. I mean we are paying adequately; advance tax is being paid and that is why we are not providing for it. Plus, the write-offs that we have been doing on the bad debts as per our board approved policy, that has also given us some relief and some cushioning because of which our tax has come down. ... It should be 17.42%, this is the MAT tax rate

Explains the negligible tax provision for the current 9M period due to advance tax payments and write-offs, and provides the long-term MAT rate of 17.42%.

Asked by Shobhit Sharma

Segment contributing most to ICR improvement Direct
It is the health segment. The health segment contributed immensely to the improvement because it forms around 48% of our book and the Incurred Claim Ratio has come down by 2 percentage points up to 9 months. And for the Quarter, it has come down quite drastically from 103% to 91%.

Identifies Health as the primary driver of ICR improvement, highlighting its significant impact due to its large share of the book and substantial reduction in ICR.

Asked by Pawan Sachdev

Strategy for Health segment ICR sustainability Direct
It is. We are working towards a strategy where the group GMC accounts are concerned. We are either pricing them and negotiating to get closer to the core right price or we are exiting from GMCs that do not give us adequate pricing and going for accounts where pricing is more fair and more adequate. Apart from that, we have increased our anti-fraud activities. Like, we have increased inspections from 30% to 50% compulsorily and we will be increasing it even more in the Quarters to come. We have got our own doctors. We are on the way of hiring new doctors. So, this activity will go on intensifying. We are on the threshold of buying a new software for fraud analysis and already the vendor selection process is on and I think in 3-4 months' time we would be able to bring in that fraud monitoring software which would make this entire activity even more automated. And I think therefore the sustenance of this model is going to definitely be there, going forward.

Details the multi-pronged strategy for sustaining Health ICR improvement, including pricing discipline, exiting unprofitable group accounts, and enhanced anti-fraud measures with technology adoption.

Asked by Pawan Sachdev

3 min read 7 chapters

Detailed narrative

Financial Performance Overview

New India Assurance reported a global gross written premium of ₹11,680 crore for Q3 FY26, marking an 8.37% year-on-year growth, with net premiums earned at ₹9,725 crore. Net Profit after Tax for the quarter stood at ₹372 crore, an increase from ₹353 crore in the corresponding period last year. For the nine months ended FY26, global GWP was ₹35,555 crore and PAT was ₹826 crore, with a Return on Equity of 4.95%.

Operating Metrics and Combined Ratio

The Net Incurred Claim Ratio for Q3 FY26 improved to 90.77% from 94.49% last year, while the 9M FY26 ICR was 99.63%. The Commission ratio and Expense ratio for Q3 FY26 were 10.78% and 16.44% respectively. The Combined Ratio for Q3 FY26 was 117.98%, an increase from 116.28% last year, primarily due to a provision for wage revision. Without the wage revision impact, the Q3 FY26 Combined Ratio would have been 110.13%.

Strategic Portfolio Recalibration and Growth

The company is actively recalibrating its portfolio by exiting or restructuring select large corporate accounts with inadequate pricing, particularly in Motor, which saw a negative growth of 0.89% in Q3. This strategy aims to improve profitability and capital efficiency by focusing on Retail, SME, and better quality risks. Domestic Gross Direct Premium Income grew by 13.71%, outpacing the industry growth of 8.69%, leading to an increased market share of 13.40%.

Investment Performance and Wage Revision Impact

Investment income for Q3 FY26 was ₹2,280 crore, comprising ₹1,200 crore from interest, dividend, and rent, and ₹1,080 crore from capital gains. Total profit on sale of investments for 9M FY26 was ₹4,236 crore, with ₹2,000 crore specifically used to offset the wage revision provision. The total wage revision calculation is around ₹2,500 crore, with ₹1,677 crore for in-service employees and ₹642 crore for retired employees already accounted for. An additional ₹700-800 crore for Family Pension Scheme is pending notification and will be provided in Q4.

Segmental Performance and Market Share

Health and Personal Accidents, comprising 48.16% of the product mix, saw a significant ICR improvement from 103% to 91% in Q3, driven by anti-fraud measures and pricing discipline. Marine segment recorded a 19.46% growth in Q3 but an ICR of 119% due to large claims. Fire and Engineering segments also showed strong growth of 4.06% and 16.46% respectively in Q3. The company maintains strong market shares, including 17.69% in Fire and 18.19% in Marine.

New Product Development and Parametric Insurance

New India Assurance is focusing on launching innovative products, including Parametric Insurance, which is seen as a key area for future growth and penetration. This new line of business, with its digital interface and faster claim settlement, has seen 10-12 contracts executed so far. The company anticipates significant traction for Parametric Insurance in the coming year, contributing to its penetration agenda.

Credit Rating and Solvency

AM Best, a global credit rating agency, revised New India Assurance's outlook to positive from stable in December 2025, while reaffirming its financial strength rating of B++ (Good) and long-term issuer credit rating of BBB+. This revision recognizes improving enterprise risk management and strengthening internal systems. The company maintained a strong solvency ratio of 1.81x, comfortably above regulatory requirements, and its asset under management grew to ₹1,00,890 crore.

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