ICICI Lombard General company on Saturday posted a 23.8 percent year-on-year (YoY) rise in its March quarter (Q4) net profit at Rs 281.93 crore, as there is a reduction in underwriting losses.
The underwriting loss reduced to Rs 29.42 crore in the March quarter (Q4) for FY20 as compared to Rs 49.70 crore in the March quarter (Q4) for FY19.
According to Bhargav Dasgupta, CEO, ICICI Lombard, the reduction in underwriting losses was due to a conscious call to not write crop business and also due to pricing improvements in segments like fire insurance. He made it clear that the company will continue to stay conscious as far as the crop insurance segment is concerned.
Lombard’s MTM investment losses came at Rs.550 crore in the quarter. While the overall investment book at the end of the financial year 2019-20 stood at Rs.26300 crore.
ICICI Lombard took an impairment hit of Rs 120 crore in Q4. The mark-to-market losses in the equity book are Rs 550 crore at end of March 31, 2020. However, the overall net investment income rose by 33.6 percent YoY to Rs 418.37 crore in Q4FY20.
Gross direct premium income (GDPI) Rs 3,485 crore of the company stood at Rs 3,181 crore in Q4 for FY20 as compared to Rs 3,485 crore in Q4 for FY19. Thus, GDPI rose by 2.9 percent year over year to Rs 3,244 crore, excluding crop insurance.
All business segments except retail health and motor insurance posted an underwriting profit for Q4.
The combined ratio stood at 100.1 percent in Q4 for FY20 compared to 99 percent in Q4 for FY19.ICICI A combined ratio below 100 percent indicates an underwriting profit. While a combined ratio above 100 percent means paying out more money in claims than receiving through premium.