(Reuters) – India’s ICICI Lombard General Insurance reported a 20% increase in its second-quarter profit on Friday, aided by higher premiums in its motor and health insurance units.
The company’s profit after tax rose to 6.94 billion rupees ($82.6 million) for the three months ended Sept. 30 from 5.77 billion rupees a year earlier.
Analysts have said that strong growth in the old vehicles’ renewal book as well as higher motorcycle sales during the quarter- which helped offset muted car sales- propped up general insurers’ bottom line.
Indian carmakers’ sales to dealers marked the first decline in 10 quarters in the July-September period, data from an industry body showed.
Motor insurance, ICICI Lombard’s biggest segment, contributed nearly half of the total premiums earned and grew 14.4% during the quarter.
Premiums from the company’s fastest-growing corporate health insurance unit rose 22%, which analysts attribute to new product launches and increasing awareness about insurance policies post-pandemic.
ICICI Lombard, which is backed by ICICI Bank, also offers marine and crop insurance, among others.
The company’s net premiums earned rose 16.7% to 50.26 billion rupees during the quarter, while claims paid rose about 31%.
Its income from investments rose about 14% to 8.46 billion rupees as equity markets hit several record highs during the September quarter.
However, its combined ratio, a key profitability metric for an insurer’s underwriting business, increased to 104.5% during the quarter from 103.9% a year earlier, hurt by impact from “catastrophic” losses, the firm said, without disclosing further details.
A rising combined ratio indicates the insurer is paying out more than it’s receiving through premiums.
The company’s shares ended 1% lower ahead of results, while the stock has gained nearly 42% so far this year.
($1 = 84.0350 Indian rupees)
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(Reporting by Dimpal Gulwani; Editing by Abinaya Vijayaraghavan)
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