ICICI Lombard General Insurance Company Limited (ICICIGI) Q4 FY22 Earnings Concall Transcript

ICICI Lombard General Insurance Company Limited (NSE: ICICIGI) Q4 2022 earnings concall dated Apr. 21, 2022

Corporate Participants:

Bhargav Dasgupta — Managing Director and Chief Executive Officer

Gopal Balachandran — Chief Finance Officer and Chief Risk Officer

Analysts:

Shreya Shivani — CLSA — Analyst

Abhishek Saraf — Jefferies — Analyst

Madhukar Ladha — Elara Capital — Analyst

Prayesh Jain — Motilal Oswal Financial Services Ltd. — Analyst

Sanketh Godha — Spark Capital Advisors (India) Private Limited — Analyst

Neeraj Toshniwal — UBS Securities — Analyst

Chetan Thacker — ASK Investment Managers Ltd. — Analyst

Prateek Poddar — Nippon India Mutual Fund — Analyst

Hitesh Gulati — Haitong Securities — Analyst

Nidhesh Jain — Investec India — Analyst

Nischint Chawathe — Kotak Securities Ltd. — Analyst

Presentation:

Operator

Good evening, ladies and gentlemen. A very warm welcome to ICICI Lombard General Insurance Company Limited’s Q4 and FY ’22 Earnings Conference Call. From the senior management, we have with us today Mr. Bhargav Dasgupta, MD and CEO of the Company; Mr. Gopal Balachandran, CFO and CRO; Mr. Sanjeev Mantri, Executive Director, Retail; and Mr. Alok Agarwal, Executive Director, Wholesale.

Please note that any statements, comments are made in today’s call that may look like forward-looking statements are based on information presently available to the management, and do not constitute an indication of any future performance as future involves risks and uncertainties, which could cause results to differ materially from the current views being expressed. [Operator Instructions]

I now hand the conference over to Mr. Bhargav Dasgupta, MD and CEO, ICICI Lombard General Insurance Limited. Thank you, and over to you, sir.

Bhargav Dasgupta — Managing Director and Chief Executive Officer

Thank you, Neerav. Good evening to each one of you, and thank you for joining the earnings conference call of ICICI Lombard General Insurance Company Limited for Q4 FY ’22 and for the full year ’22. I will give you a brief overview of the industry trends and developments that we’ve witnessed in the last few months. Post this, our CFO, Mr. Gopal Balachandran will share the financial performance of the company for the quarter and the year ended March 31, 2022.

The industry registered a GDPI growth of 11.1% for FY ’22. As per public disclosures, the combined ratio of the industry was 119.2% for nine months FY ’22 as compared to 110.4% for nine month FY ’21. And the industry reported a loss of INR4.05 billion as against profit after tax of INR55.6 billion for nine month FY ’21. Further, the overall combined ratio for the private multiline general insurers was 112% in nine month FY ’22 as compared to 104.6% in nine month FY 2021. Industry’s solvency at nine month FY ’22 was worsened to 1.71 times as against 2.07 times at nine months of FY ’21.

So moving to the quarter under review, the industry delivered a mixed performance. As per the data published by SIAM, the new vehicle sales witnessed tepid growth of private car segment on the back of supply chain challenges. The two-wheeler segment remained far from recovery while the commercial vehicle segment has shown growth supported by underlying demand. Health insurance, on the other hand, contributed significantly to the overall industry growth in line with the expectation and is now the largest contributing segment to the GDPI of the industry. The commercial lines witnessed robust growth in sync with current market environment.

Coming to the business impact for us. The company has grown in line with the market growth of 12.7%. This is excluding crop and mass health as against the lower growth that we witnessed till nine month of FY ’22. Within the quarter, the growth momentum has increased each month and the company has significantly outgrown the market in the month of March 2022.

Coming to the growth for key segments during the quarter. For motor, the company has grown faster than the industry and we have now attained market leadership in this segment for the year. Our investment in the retail health side has started to show results and has resulted in our agency channel premium growth of 29.5% for the quarter. As indicated in our previous calls, up to 1,000 retail health agency managers to be added to our employee base, we have now onboarded 750 of them during this fiscal and the balance 250 offers have been made. We expect the growth to accelerate in the next few quarters as the salesforce starts getting productive.

The corporate channel including Bancassurance is back in the black with overall growth of 19.4%. Within this, ICICI Bank distribution grew by 24.9% primarily driven by health indemnity, SME, and motor business, and other distribution partners acquired through the integration grew 15.9% during the same period. Our business sourced through our website grew by 20%. Within this, our Health business grew by 23%, Travel grew by 130%, and Motor grew by 10%. Business sourced through strategic alliance partners in the digital ecosystem grew by 98.2%. Overall, our digital solutions has enabled us to increase our digital revenues by up to INR7.74 billion for the current year, which amounts to 4.3% of our overall GDPI. As for the commercial lines are concerned, we experienced robust growth driven by 17.8% growth in the SME segment.

Let me now give you a update on some of our other key initiatives. On the integration, I’m very happy to share that as we speak ICICI Lombard stands as the second largest non-life insurer in India. Exactly as envisioned while evaluating the scheme as a potential transaction, the integration enabled us to strengthen our market leadership, augment and further strengthen our diverse distribution channels. The revenue and operating — operational synergies activity plans are on track and Gopal would talk about this in detail in his segment.

Our IL Take Care app has surpassed 1.3 million downloads with successful submission of over 1,30,000 claims and over 70,000 tele-consultation requests. The recently-added feature face scan helps users keep a track of vitals such as blood pressure, heart rate, respiration rate, etc. all without any additional devices and from the comfort and safety of one’s home. IL Take Care is built to be user friendly and a continuous engagement platform, which is increasing our ability to cross sell.

We are also pleased to share with you that we are the first large insurer to move our entire core systems onto the Cloud this year. In our data center, we had about 110 applications across 600 servers and around 1,000 terabytes of data. Moving our complete set up onto Cloud has given us some immediate benefits including stability, availability, and scalability. As such, some of the investments that we have made during the year in distribution and technology is bearing fruit and we expect to see momentum in growth as we head into the next financial year. We intend to continue with our expansion across distribution, digital, technology, and claim services. Towards this, we have planned additional investments in the range of INR1 billion to INR1.5 billion during this year — during the coming year.

I will now request Gopal to take you through the financial numbers for the recently concluded quarter.

Gopal Balachandran — Chief Finance Officer and Chief Risk Officer

Thanks, Bhargav, and good evening to each one of you. I will now give you a brief overview of the financial performance of the company for quarter 4 and FY 2022. We have put up the results presentation on our website. You can access it as we walk you through the performance numbers.

The effect of the demerger in the financials has been incorporated in the form of opening net worth as on April 1, 2021. Further, the financials for the current year represent numbers of the merged entity and the comparative numbers for the previous year in the financials pertain to standalone ICICI Lombard, and hence, not comparable.

The company has enhanced disclosure requirement of reserving triangles by giving separate reserving triangles for motor third party and non-motor third party lines of businesses. This is in accordance with the regulatory guidelines on public disclosures, which is applicable to all the players in the market. You may refer to Slide number 29 and 30 of the investor presentation on the reserving triangle disclosures.

Our gross direct premium income of the company was at INR179.77 billion in FY 2022 as against INR140.03 billion in FY 2021. The industry reported a double-digit growth of 11.1% on a lower base for a similar period. Our GDPI growth was primarily driven by growth in preferred segments given that our approach has always been growing business sustainably. The Fire segment GDPI was the INR27.5 billion in FY ’22 as against INR21.58 billion in FY ’21. As indicated in our results presentation, the overall GDPI of our Property and Casualty segment was INR50.24 billion in FY ’22 as against INR39.29 billion in FY ’21.

On the retail side of business, GDPI of the Motor segment was at INR82.8 billion in FY ’22 as against INR70.2 billion in FY 2021. To harness the potential of these segments, we have been expanding our distribution network to increase penetration in Tier 3 and Tier 4 cities. Our agents, which includes the point of sale has increased to 88,539 as on March 31, 2022 from 81,969 as on December 31, 2021. The advanced premium numbers was INR33.68 billion as at March 31, 2022 as against INR34.59 billion as at December 31, 2021. Resultantly, combined ratio was 108.8% in FY ’22 as against 99.8% in FY ’21 and 111% in nine month FY 2022. Combined ratio was 103.2% in quarter 4 FY ’22 as against 101.8% in quarter 4 FY ’21 and 104.5% in quarter 3 FY ’22. Our investment assets rose to INR387.86 billion at March 31, 2022 from INR374.54 billion at December 31, 2021. Our investment leverage net of borrowings was 4.23 times at March 31, 2022 compared to 4.23 times at December 31, 2021.

Investment income was at INR30 billion in FY ’22 as against INR21.96 billion in FY ’21. On a quarterly basis, investment income was INR7.06 billion in quarter 4 FY ’22 as against INR5.37 billion in quarter 4 FY ’21. Our capital gains was at INR7.38 billion in FY ’22 as against INR3.59 billion in FY 2021. Capital gains for quarter 4 FY ’22 was at INR1.36 billion as against INR0.66 billion in quarter 4 FY ’21.

The successful integration of the demerged business of Bharati AXA into the company has led to optimization of our organizational structure, rationalization of offices, efficiencies in claim settlement practices, and technology applications. This will result in an annualized synergy benefits of INR2 billion, of which INR0.7 billion has been realized in FY 2022.

Our profit before tax was INR16.84 billion in FY ’22 as against INR19.54 billion in FY ’21 whereas PBT was INR4.1 billion in quarter 4 FY ’22 as against INR4.5 billion in quarter 4 FY ’21. As explained above, the company has seen higher growth momentum in Q4 FY ’22 and within that in the month of March 2022. Due to the current accounting norm, this results in upfronting of sourcing costs whereas the benefit of earned premium will be realized over the policy period. Consequently, profit after tax was INR12.71 billion in FY ’22 as against INR14.73 billion in FY ’21 whereas profit after tax stood at INR3.13 billion in Q4 FY ’22 as against INR3.46 billion in Q4 FY ’21.

The Board of Directors of the Company has proposed a final dividend of INR5 per share for FY 2022. The payment is, however, subject to approval of shareholders in the ensuing Annual General Meeting of the company. The overall dividend for FY ’22 including the proposed final dividend is INR9 per share.

Return on average equity was 14.7% in FY ’22 as against 21.7% in FY ’21. The return on equity for Q4 FY ’22 was 14% as against 18.8% in Q4 FY ’21. Solvency ratio was at 2.46 times at March 31, 2022 as against 2.45 times at December 31, 2021, which continue to be higher than the minimum regulatory requirement of 1.5 times.

As I conclude, I would like to reiterate that we continue to stay focused on profitable growth, sustainable value creation, and safeguarding interest of policyholders at all time. I would like to thank you all for attending this earnings call and we will be happy to take any specific questions that you may have. Thank you.

Questions and Answers:

Operator

[Operator Instructions] The first question is from the line of Shreya Shivani from CLSA. Please go ahead.

Shreya Shivani — CLSA — Analyst

Hi. Thank you for the opportunity. Sir, a couple of questions I had. I’ll probably just take two and then get back in the queue. First one is on the TP hike rate that was announced, and what is the — what is your feedback on how comfortable are you with the kind of hike that the regulator has proposed? And if you can help us get to an idea — in spite of the hike, I think given that the car — underlying car sales is still weak, if you can help us understand how much proportion of your motor TP book is private cars that would be the first question.

Second is on your — sir, just looking at your March ’22 data, month — the monthly data, so the trend in your motor TP book was quite strong and it was stronger in the industry for that matter. So if you can give me — so if you can help us understand that? And lastly on the loss ratios for Fire. It’s come down quite dramatically in this quarter, so if you can help us understand that would be helpful?

Bhargav Dasgupta — Managing Director and Chief Executive Officer

Thanks, Shivani. So let me take the questions and the answers — give the answer in the same sequence. So if you look at the TP rate hike, it’s different across different segments, but the long-term TP rates hike is a bit higher. Overall, at a portfolio level for the industry, weighted average increase comes to roughly about 3-odd-percent plus minus.

Honestly speaking, given the general inflation that we see, we would have liked to see slightly higher rate in certain categories. In certain categories, we are fine with the rate hike that has been given. So in aggregate, maybe a little bit higher would have been appropriate is our view on this. When is it expected? As of now, the understanding is that it will come around May. So that’s where we are on the TP hike.

In terms of the mix, I’ll ask Gopal to answer the mix point on the private car.

Gopal Balachandran — Chief Finance Officer and Chief Risk Officer

Yes. So, Shreya, as you can see so far as we have given on this slide the split of OD and TP, which is roughly about INR40.68 billion is own damage and about INR42.12 billion is third party. Within that INR42.12 billion, private car third party will be about INR13.49 billion.

Bhargav Dasgupta — Managing Director and Chief Executive Officer

Coming back to your question on growth, I think what’s happened as we’ve been kind of explaining for the last few quarters is that we took some calibrate call on kind of readjusting our portfolios away from certain private car segments given the pricing competition that we saw in the private car and the own damage side and increasing on the CV side. Again, very calibrated, very selective calls based on ground-level insights plus some experimentation that we’ve been doing for the last three years to figure out if some of those books are going to be better risk for us.

Now, when — in retail, when you cut down, the number goes away immediately but to build up it takes some time. So I think on the commercial side, the growth momentum has now picked up. And what we’ve been kind of indicating is that if you look at our overall portfolio mix unlike the market where out of the total motor book roughly 45% will be commercial vehicle, for us that was in the teens, 15% to 17%. That — as we’ve been saying, that should go do roughly in the mid-20s. So that journey has now started. We will have to see if we can maintain the momentum of growth of March, but clearly, the increase in the market share of CV is something that we expect going ahead.

Gopal Balachandran — Chief Finance Officer and Chief Risk Officer

And your last question on Fire loss ratio, Shreya, again I think, that’s one segment where we keep talking about saying that a quarterly loss ratio may not necessarily be reflective of the underlying outcome of the performance. A better number to look at will be more, I would say, financial year numbers. In fact, within that, I mean there could be years where because of, let’s say, various large losses or catastrophic years impact the loss ratio of that particular — this segment could get impacted. So hence quarterly numbers may not necessarily kind of reflect, as I said, the underlying outcome. Look at more the annual numbers for the Fire part of the business.

Shreya Shivani — CLSA — Analyst

Got it. Okay. Thank you, guys.

Operator

Thank you. The next question is from the line of Abhishek Saraf from Jefferies. Please go ahead.

Abhishek Saraf — Jefferies — Analyst

Thanks for the opportunity. So I just had few follow-on questions on the earlier question asked. So you mentioned that in the CV we are looking at a higher mix in the– so what is giving us confidence in terms of if we’re maintaining or continuing the loss ratios in that. If you can just give us few more details in the kind of experiments that you have done and where are we deriving this confidence from.

Secondly, if you can help me understand — I believe that we have taken hikes in motor OD segment, so what would be the average quantum of hike that we would have taken and which kind of car segment? And is it across the board that we have taken in the new or basically in the sense that for new cars, or is it across the board for new and old cars? I have few more questions after this. Will — just after, if you can answer this I will follow up, yeah.

Bhargav Dasgupta — Managing Director and Chief Executive Officer

Yes. Thanks, Abhishek. So in terms of [Indecipherable], I think we’ve been talking about what we’ve — the way we handled this. Again, if you again reiterate the point, it is not as if we believe the whole CV portfolio has hardly turned viable or sustainable or profitable. If you look at the overall industrial mix, CV will be as I said within 45% to 50%. We are not talking about going anywhere near that number.

Now what we’ve been doing for the last three years, again, various times we’ve talked about this is that based on ground-level insights, based on some changes that we are seeing both at — in certain micro segments, certain markets, based on certain usage patterns or accident patterns that are changing in certain states or even some amount of the regulatory and the compliance standards in some of these markets, we have been identifying some segments that we believe are viable today than what they were in the past. And what we’ve been doing as a company is that we’ve been taking small bets to see — writing small amount of business reserving at a level where we believe it is very, very conservative, but allowing the team to write some those businesses to see what is the experience that we have over the next two to three years. Some of those experiments have proved to be in line with our expectations, so those are areas where we are scaling our businesses. So, that’s the confidence that we are getting in terms of the segments of business.

Now, in terms of — and the efforts that we are taking is not just a loss ratio. You are not looking at a loss ratio, you are looking at the combined ratio in terms of sourcing cost and loss ratio together, and wherever there is viability that’s where taking those calls. In terms of private car, the increase is reasonably across the board. There are one or two OEMs, which haven’t agreed. We are discussing, but most of the areas we’ve taken price increases.

Abhishek Saraf — Jefferies — Analyst

Thanks for that answer, Bhargav, and just if you can help us understand if you can share the quantum of hikes on an average that we would have taken.

Bhargav Dasgupta — Managing Director and Chief Executive Officer

It could be single-digit ratio. It’s not that we’ve taken a huge hike, it will be a single-digit hike.

Abhishek Saraf — Jefferies — Analyst

Okay, that’s very helpful. Secondly, on — I just noticed that in the calamity losses, our share of losses have actually gone up in this year, so is it only because of integration with Bharti AXA or is there more to it? So if you can help me understand the are our — is our share of premium also have gone up proportionately in line with the losses as well?

Bhargav Dasgupta — Managing Director and Chief Executive Officer

Yeah, so this was largely the cyclone Tauktae that you’re talking about. If you look at the last — If you look at the last 10, 12 CATs, our share of losses were significantly lower than our normal market share. In Tauktae, we had two of our corporate exposures that got hit, so it was kind of a unfortunate consented event, not as if there was a large impact across the board. So that’s why we have a impact in the Tauktae because in those cases here in the western market where we have a slightly higher share than our natural market share. So when you look at our, let’s say loss share that we have got related to the market share in these markets, they get lower.

Abhishek Saraf — Jefferies — Analyst

Sure. Thanks, Bhargav. That’s very helpful. Thanks a lot.

Operator

Thank you. The next question is from the line of Madhukar Ladha from Elara Capital. Please go ahead.

Madhukar Ladha — Elara Capital — Analyst

Hello. Am I audible?

Operator

Yes, you are.

Bhargav Dasgupta — Managing Director and Chief Executive Officer

Yeah, Madhukar. Please go ahead.

Madhukar Ladha — Elara Capital — Analyst

Yeah. Thanks for the opportunity. So your OD loss ratios for OD and TP, and especially TP actually for Q4 have risen quite materially. And if you look at the quarter by quarter trend, there is quite a bit of volatility. Now, when we look into the future, how should be thinking about it? Should we be thinking more in terms of exit rate will be more appropriate for next year or the full year rate as a base? And — so what sort of — how do you sort of project these things or how do you look at it?

Gopal Balachandran — Chief Finance Officer and Chief Risk Officer

So, Madhukar — so if you look at on the motor own damage segment, I think to my mind when you look at more the exit rates for quarter 4 is — will be largely reflective of the trend line that one could potentially see so far as the way forward is concerned. And the reason why we are saying is in line with what we had discussed even in our earlier calls, the thought process is to try and see how we can get significantly into writing businesses, which will be relatively driven so far as more on, let’s say, high loss ratios and relatively lower cost of sourcing-led businesses.

That’s the thought process that we have in terms of increasingly building the book. And that’s the reason why I would say quarter 4 on the motor own damage is largely reflective of what one could experience at least in so far as the trend line for the future is concerned. Having said that, obviously, we continue to kind of micro-segment the portfolio to see which are the segments, which we want to select and underwrite in terms of building the overall book. But the thought process is in line with that as I said build a book, which is relatively high LR and low expense in so far as cost of sourcing is concerned.

On the third-party portfolio, I think — maybe I think what you could — the full year numbers are largely representative of what one could experience in so far as the way forward is concerned. Quarter 4, specifically, I think in line with what we had done in quarter 4 of last year if you recollect, I think there were those Supreme Court judgments which had come through. This is which we had to kind of revisit all the outstanding cases that we had as of the previous year and we had to kind of strengthen the reserving requirements assuming the fact that we could expect an increase in average claim payout consequent to those judgments on the outstanding cases as well.

On the similar lines, I think what we have experienced over the last couple of years, which is for understandable reasons that the Courts in India, which is a predominantly where you get bulk of the motor third-party orders being received, that has not been functioning at full force. While we have started to see particularly maybe quarter 4, we have already seen things coming back. But at least over the last, I would say, three to six quarters, the Courts have not necessarily been functioning at full swing.

What this does is obviously it kind of starts to have an impact in so far as the trend line of settlements of — or closures of cases of third-party that we would have done relative to the historical past, which would mean obviously given the fact that there has been some lag in so far as the extent of closures that we would have normally seen which could happen in the future period, we obviously have to kind of factor in for — or maybe built in an element of further inflation assumption as a part of our reserving book. Particularly the element of interest that we will have to add in so far as our reserving circumstance. And hence, the trend line for Q4 on the third-party book will be more representative of what one could expect so far as future trend line is concerned. That’s what…

Madhukar Ladha — Elara Capital — Analyst

Q4 even for TP?

Gopal Balachandran — Chief Finance Officer and Chief Risk Officer

Yeah. And the other — I think one should also mindful, Madhukar, is I think given the fact that we also strengthened the reserving book of the motor third party pool as you would have seen in terms of the NIS disclosures, this element of increased interest which will — or inflation that we release as a part of the reserve has obviously led in so far as the erstwhile motor pool book is concerned, we are obviously strengthened the results. However, on aggregate basis, we have motor third party, which is actually reflecting a small amount of reserve releases.

Madhukar Ladha — Elara Capital — Analyst

Got it. got it. Also then…

Bhargav Dasgupta — Managing Director and Chief Executive Officer

Just to add to what Gopal said. Effectively what we are looking at is the combined rather than just the loss ratio, when we are selecting business. And the attempt is to bring the combined more under control, not just look at the loss ratio.

Madhukar Ladha — Elara Capital — Analyst

Right. I’m guessing the comparative intensity is driving us in this direction. And that’s why we are seeing slightly probably lower commission ratio and expense ratios in 4Q, would that be right to say and what would be like the trend for FY ’23?

Bhargav Dasgupta — Managing Director and Chief Executive Officer

So more than — the competitive intensity is overall driving of the overall combined for motor, but if you look at from our pure ROE perspective, businesses which are high LR, but no expense issue are better businesses because the expense is upfront, LR comes over the period.

Madhukar Ladha — Elara Capital — Analyst

Right. Right. And our expectation on how like the integration with Bharti and what should be our expense ratios and what sort of expense ratio should we expect in FY ’23, ’24? Any guidance on that?

Bhargav Dasgupta — Managing Director and Chief Executive Officer

So, those improved synergy numbers, Gopal can explain.

Gopal Balachandran — Chief Finance Officer and Chief Risk Officer

It’s very difficult to put out a number, Madhukar, because I think on the one side as we have put out what is — what will be the annualized synergy numbers which we put out as a part of the opening remarks, which is roughly about…

Madhukar Ladha — Elara Capital — Analyst

I think I missed that. Sorry.

Gopal Balachandran — Chief Finance Officer and Chief Risk Officer

Yeah. Having said that I think what we will continue to do when we look at, let’s say, FY ’23 or maybe the year thereafter, we would want to continue to kind of stay invested in building some of our expansion plans, particularly what we have spoken about on let’s say on the health agency distribution side. We want to continuously stay invested on building our digital opportunities that we see including the investments in technology and claim service. So, to some extent, I think largely what would end up is obviously we would — we are pretty much on track in order to kind of realize the benefits of synergy. But at the same time, we would want to kind of use some of these to kind of increase the opportunity that we see on account of the renewed growth momentum that we have seen for ourselves.

Bhargav Dasgupta — Managing Director and Chief Executive Officer

So, if you remember what we had discussed when we did the transaction, we have said that for a couple of years our combined ratio will be elevated and then it will start coming down. If you see our combined ratio for this quarter, it’s — relative to the last two quarters it’s already trending down. So that is an ongoing effort that we will make to keep the combined ratio under control.

Now, we’ve also said that as a strategy rather than bringing combined down to 100 and delivering a 20% ROE, we want to keep on investing and grow the book a bit faster. Consequently, the ROE may have come down to the hiking. But, initially, we are improved in combined. That should continue.

Madhukar Ladha — Elara Capital — Analyst

Understood, understood. And final question I was reading the notes to accounts, there is a INR65 crore payment of GST under protest and additional agreement to pay INR40 crores, can you explain that and what is this the result of and the implication if any?

Gopal Balachandran — Chief Finance Officer and Chief Risk Officer

Yeah. So these are a couple of matters as what we have put out as a part of the disclosure in the notes to accounts. As an insurance company, we are entitled to claim input credit in so far as settlement of motor claims related expenses are concerned, both with respect to the arrangement that we have either on a cashless or whether on a reimbursement basis. In so far as the GST department is concerned, I think they seem to kind of allege that possibly we are not entitled to claim certain inputs with respect to some of those motor claim related expenses. So that’s one.

The second is — aspect is again with respect to realization of as a part of claims settlement, again in the context of Motor portfolio. We do kind of end up having certain element of salvages. The view of the department is that on that particular amount of salvage amount that we end up realizing, there should be an element of GST applicability on the extent of realizations that we have made. We have consulted the expert opinions as well as senior counsels on this in terms of the stand that the company has taken, both with respect to the eligibility of input credit or motor claim as well as whether there will be any element of applicability of GST in so far as salvage related realizations are concerned. The stand of the company is pretty much well found and it is legally correct.

So at this point of time, obviously, that’s the reason why the amount that — of INR65 crores is paid under protest and another INR40 crores is something that we will — we have committed to pay. Or at appropriate point of time in due course, we will be filing the refund for getting these amounts back. But at this point of time, these amounts are largely kind of paid under protest. What we clearly understand is obviously this is something which is applicable more at an industry level and hence to that extent collectively, we will — the stand of the industry is something that we will work with and ensure that we are able to get the rightful amount that is due back to us.

Madhukar Ladha — Elara Capital — Analyst

Understood, understood. So this is an industry phenomenon, so the tax department is…

Bhargav Dasgupta — Managing Director and Chief Executive Officer

Absolutely. This is not specific to ICICI Lombard. These — both the issues are at an industry level, applicable to almost all the players in the market.

Madhukar Ladha — Elara Capital — Analyst

Got it. Got it. Thanks. Thanks. That’s very helpful.

Operator

[Operator Instructions] The next question is from the line of Prayesh Jain from Motilal Oswal Financial Services. Please go ahead.

Prayesh Jain — Motilal Oswal Financial Services Ltd. — Analyst

Hey. Hi. Good evening, everyone. Firstly, could you talk about the health claim ratios on the retail side in particular and on the group health, how are they spread in Q4? And are they back to pre-COVID levels or there are certain elements which are still there with respect to COVID? And how do you the see this going ahead? I’ll ask my second question after that.

Gopal Balachandran — Chief Finance Officer and Chief Risk Officer

So if you look at the split of the health loss ratios which has been given in the aggregate on the presentation deck, the breakup of that in terms of the employer-employee portfolio or let’s say the corporate book, that number for quarter 3 was 93.1%, that number for quarter 4 is 95.3%. And on the retail indemnity book, the loss ratios in quarter 3 was about 65.7% and for quarter 4 that number stands at about 57.6%.

Prayesh Jain — Motilal Oswal Financial Services Ltd. — Analyst

Okay. So my question was when it has — the retail definitely has come up and — so this is more of a normalized level now and we can presume it to be in a similar trajectory going ahead, right?

Gopal Balachandran — Chief Finance Officer and Chief Risk Officer

So when you look at, for example, on the corporate or let’s say the employer-employee book, we have always spoken about saying that it typically, particularly the large corporates tends to kind of operate at a loss ratio which could be ranging anywhere between 95% to 100% anywhere between that. And in so far as the relatively small and mid corporate book is concerned, they generally tend to kind of operate on again the employer-employee part at anywhere between 90% to 95%, which is where on a blended basis I think one generally gets to see the loss ratios which are relatively around those 95% threshold. However, the cost of acquisition with respect to these businesses, particularly the large corporate, tends to be more direct. And hence to that extent on an aggregate basis on the combined ratio book, it becomes viable for us to underwrite.

Having said that, I think over the last three quarters, we have been kind of talking through particularly on the employer-employee book given the fact that we have seen, particularly this year, the impact of COVID losses playing out, we have been affecting clearly price increases in so far as the renewal of the portfolio is concerned. While we had indicated a price increase in the range of 15% to 20% during our quarter 1 earnings call but subsequently as and when the actual renewals have happened, we have been able to cite realizations which have been slightly higher than that. And even with the increased price realization, we have been able to clearly hold on to in fact more than 90% of the renewals in so far as the employer-employee or let’s say the corporate book is concerned.

On the retail side, again the thought process is pretty much similar. We continue to keep looking at the portfolio outcome in terms of what is the desired loss ratio of the book. In general, I think particularly on the indemnity book, I mean depending on the kind of book that you write, the loss ratios could range anywhere between, I would say, 60% to 70% on a steady-state whereas the relative cost of acquisition in the initial periods would tend to be relatively higher given the investments that we’re making on building distribution. So that’s what I would say in so far as steady-state loss experiences are concerned, both on the corporate health or let’s say the retail indemnity book.

Prayesh Jain — Motilal Oswal Financial Services Ltd. — Analyst

Thanks. So the second question is more broad level and a slightly longer term as well. So if you look at the efforts that players like you all have taken with regards to tech-enabled claim settlement processes on the health side or on the motor side, several initiatives that have been taken, so do you see that this benefit — the benefits of these efforts will get more reflected in the pricing coming down or it would translate into more combined ratio improvement? So what is the strategy that I LOM will be adopting in order to take benefits of these measures?

Bhargav Dasgupta — Managing Director and Chief Executive Officer

So in terms of our long-term thought process, this is just — what you’re talking about is definitely correct, but it’s only one element of what we are — how we are building this. So if you look at, for example, on our claims on the health side, we have launched the AI-driven authorization ML engine for settling claims for corporates. That’s currently running at lower than 60%. We believe that number will keep increasing as we go along. But the approach us across multiple levels.

So if you think about it, the entire approach with IL Take Care was to look at an engagement and a continuum of care approach with corporates. And we believe there are multiple advantages of that beyond cross-sell, up-sell engagement, renewals, etc. Even at the time of claims we believe in the longer term, we will see some benefits. So we are already beginning to see that more than 40% of our corporate client claims are coming even reimbursement cases are coming through that app. We are — what we’ve seen in the past is when we had moved the entire claim service in-house back in 2008, ’09, because we run the complete data and do a lot of analytics around it, we are able to control — we could at that point in time control frauds better. On top of it, we’ve built a lot of capability again using artificial intelligence to identify fraudulent claims better.

Now as we digitize the entire journey, the ability to run those engines better becomes even — you have the ability to run those engines even better. So we are already beginning to see some benefits in terms of fraudulent claims being managed better.

Lastly, we believe if we can drive the video consolidation, tele-consultation as a model to even control unnecessary hospitalization, that could be additional benefit. So overall, there is a very comprehensive thought process in terms of using technology to both give better convenience and service to customers and in the process improve our relative loss costs for the health claims.

Prayesh Jain — Motilal Oswal Financial Services Ltd. — Analyst

Thanks. Thanks. That’s very helpful. Thank you.

Operator

Thank you. The next question is from the line of Sanketh Godha from Spark Capital Advisors. Please go ahead.

Sanketh Godha — Spark Capital Advisors (India) Private Limited — Analyst

Thank you for the opportunity. The price hike which you have taken in motor OD, which we have said is largely limited to new business or we have taken price hike in the renewal premium too? And then just wanted to check whether it is limited to cars or…

Bhargav Dasgupta — Managing Director and Chief Executive Officer

Largely, new private car, Sanketh.

Sanketh Godha — Spark Capital Advisors (India) Private Limited — Analyst

Okay. New private car. So the control of price hike we have taken, does — will it help in improving the loss ratios which are currently 68% in ’22 and 73% during four quarters, so the expected improvement in the loss ratio because of this current price hike?

Bhargav Dasgupta — Managing Director and Chief Executive Officer

We will have to see a few things. One of the things that we are watching very closely is the claim inflation because the input costs are going up for everyone. So there is a risk that there would be claim inflation, though till now, in spite of the inflation, the team has managed it really well in terms of controlling the ACS, average claim size inflation. We are also driving a lot of our non-OEM source policies through our PPN network. That number has really gone up this year.

So we are trying multiple strategies to prevent that from going up, but fact of the matter is that we’ve seen significant increase in input costs. So there is a risk that there would be an inflation because of that. If that happens, then we may not be able to see that benefit. But our sense is that at this point in time where the private car OD loss ratios are, it needs a price increase ipso facto, I mean we factor in the inflation or not. So difficult to predict whether we’ll see improvement in loss ratio. Tf this inflation doesn’t happen, the answer is yes, but we would have to factor into that.

Sanketh Godha — Spark Capital Advisors (India) Private Limited — Analyst

But is this a industry phenomenon, the price you’re seeing across the place to happen, or — The reason I’m asking is, is it potential risk for our market share loss if we are the only guys who have taken price hike?

Bhargav Dasgupta — Managing Director and Chief Executive Officer

We don’t think so because if you see the market share recalibration that we had to do, we’ve effectively done this year. If this year — OD market share this year has gone down largely for that reason, right, because we felt that the pricing was not adequate. Where we are focusing on, the effort that we are building in terms of our digital and agency channel, maybe some of the slightly older segment, we remain reasonably confident about holding onto our market share and OD side. And something that we’ve been saying that these two years have been unusual because people have benefited from lockdowns at different times on the motor portfolio, right?

Sanketh Godha — Spark Capital Advisors (India) Private Limited — Analyst

Yeah.

Gopal Balachandran — Chief Finance Officer and Chief Risk Officer

And traditionally, wherever we see pricing especially, in the last about 12 or 18 months and then things coming back, we were talking about a pricing correction requirement even before the pandemic, right. So market was, in our opinion, ready for that and then because of pandemic there was — people felt no need because of frequency came down. We believe the market will have to rebalance and correct this year and we are seeing the stress. We are seeing that even with price increase, price correction that we are doing, we are holding onto our market share. You’ve seen our March numbers and the trend line remains that way.

Sanketh Godha — Spark Capital Advisors (India) Private Limited — Analyst

Got it. Got it. And just on the TP business, you said that mid-teens also contribution of CV to the entire TP business will reach to mid-20. Sir, just wondering that have you identified a particular product segment where you can increase that as market or contribution to 10% whether — is it just like SPVs or, auto rickshaws or [Foreign Speech], which are the segments which you have identified which will drive this increase in the contribution. And so the loss ratios?

Bhargav Dasgupta — Managing Director and Chief Executive Officer

Yes. So, it’s not at that — it’s not just at that level of segmentation. It’s significantly more granular, which obviously I don’t want to get into, but we’ve looked at down to RTO level parameters to take those calls, not just in the terms of our product. The product is obviously at an overarching level, but we’ve done a lot more deep analysis on the ground in terms of various factors we have beyond categories, and on that basis we have taken this call.

If you see our market share, it’s not a 10% shift that we’re talking about. As we speak in the Q3 numbers already come to close to 20%, so we are talking about not that number going to mid-teens — mid-20s is not that bigger stretch. And as I said, when we started doing those experiments about three years back and we watched the data for the last three years, almost 80%, 85% of the experiment have worked out well for us. That’s where we are kind of expanding. So, yes, a lot more micro-segmentation than those. Just the type of vehicle that you’re talking about.

Operator

Thank you. [Operator Instructions] The next question is from the line of Neeraj Toshniwal from UBS Securities. Please go ahead.

Neeraj Toshniwal — UBS Securities — Analyst

Yeah. Hi. So I wanted to understand what is the aggregate level hike on the motor TP [Technical Issues]

Gopal Balachandran — Chief Finance Officer and Chief Risk Officer

Neeraj, could you repeat?

Bhargav Dasgupta — Managing Director and Chief Executive Officer

There is an echo. We can’t understand what you’re saying, Neeraj.

Neeraj Toshniwal — UBS Securities — Analyst

The motor TP hike on aggregate level.

Bhargav Dasgupta — Managing Director and Chief Executive Officer

Motor TP hike?

Neeraj Toshniwal — UBS Securities — Analyst

Yeah. On aggregate level for us.

Bhargav Dasgupta — Managing Director and Chief Executive Officer

At the portfolio level, roughly about 3%.

Gopal Balachandran — Chief Finance Officer and Chief Risk Officer

Roughly about 3%, Neeraj.

Neeraj Toshniwal — UBS Securities — Analyst

Okay, and was that…

Operator

Sir, sorry to interrupt you, but your voice is not coming very clear. May I request you to speak through the handset?

Neeraj Toshniwal — UBS Securities — Analyst

Sure. Is it better?

Operator

Yes.

Neeraj Toshniwal — UBS Securities — Analyst

And how much is that with the change in mix within the Motor TP with higher CV? Will that material be different or will the pocket share identify it? I mean, we have grown substantially higher in the March in the Motor TP in general quarter 2 make more sense how more sustainable it is and what kind of run rate we can expect going forward? With the increasing losses, so that could be kind of magnifying into the [Technical Issues]

Bhargav Dasgupta — Managing Director and Chief Executive Officer

Not sure about your question, Neeraj. Still not clear, but if you’re asking because of the TP price hike and the run rate of growth that weve seen in March, if it’s linked, so if you just look at the increases that is being proposed without a wait for the final increases, the increases for the long-term TP policy is a bit higher. So there our new business should benefit. The approach on the CV business is what we explained earlier that we are picking up segments on a combined ratio basis. Maybe the expense ratio is a bit low, but the loss ratio could be a bit high. But in aggregate, the combined ratio is what we are focusing on in terms of building more disciplined manner.

Neeraj Toshniwal — UBS Securities — Analyst

Got it. Got it. And one more question on motor OD. How do — I mean you obviously explained, but I wanted more color that how are we looking if, let’s say, price comp intensity doesn’t go down? So how are we thinking about initial strategy in mind?

Bhargav Dasgupta — Managing Director and Chief Executive Officer

So listen, we think it should because as I was explaining, normally, we have seen over the last — since de-tariffication we’ve seen these episodic aggression in the private car and OD segment. It does not sustain beyond 18 months, 24 months. This time it’s been close to 3.5 years. So two of those years have been pandemic. So we believe it is also driven by the fact that during pandemic people saved on claims cost. So if you look at the industry, we don’t believe people can sustain these kind of pricing aggression for too long, but we’ll have to see. And as I said, when we are taking price increases we are sensing that the market is also expecting something like this.

Neeraj Toshniwal — UBS Securities — Analyst

Okay. And on the last question on the indemnity with the agents onboarding, how much delta we can expect in terms of growth coming in at what timelines, if at all?

Bhargav Dasgupta — Managing Director and Chief Executive Officer

See, you’ve seen the delta in the month of March itself. We remain reasonably confident of sustaining that going ahead. In fact, as we explained that when you hire agency managers, they come on board, it takes about two to three months for them to even build their channels of agents. And then, the agents start getting productive. So as of now, we’ve only hired about 750, the balance 250 are expected to come in. And the initial signs in terms of the hiring of agents that they’ve done, if you look at this month, this quarter, we’ve added almost 8,000 agents plus for this quarter. So it’s picking up. The traction is high, so there’s no reason to think that this gap in our performance vis-a-vis the industry should go up. In fact, we should be able to build momentum. We are actually very optimistic about that channel that we are building. If you see just the last quarter, our agency channel has grown by about 29.5%. So I don’t see a reason why it should be lower than that for next year.

Operator

Thank you. The next question is from the line of Chetan Thacker from ASK Investment Managers. Please go ahead.

Chetan Thacker — ASK Investment Managers Ltd. — Analyst

Good evening, sir. Sir, two questions. One is on the health side. Just wanted to understand how should we view combined over a longer term, both for group and retail put together and the mix that you’re targeting? The second would be on the INR775 crore expense that is there in the shareholder account which does not pertain to the insurance business, so what does that exactly pertain to?

Bhargav Dasgupta — Managing Director and Chief Executive Officer

I’ll ask Gopal to explain the second one, then I’ll come in.

Gopal Balachandran — Chief Finance Officer and Chief Risk Officer

Yeah. Let me explain the second one, Chetan. I think it’s not — it’s — those are expenses not related to the insurance business. That’s more a classification requirement in accordance with the regulatory prescription. So just to kind of explain this, I think the regulator has laid down limits for all players in the market to comply with limits on expenses of management for the company as a whole. For ICICI Lombard, we are in compliance with those limits for the — at an aggregate level. Having said that, what the regulator has also stipulated is individual limits for some of the sub-segments of businesses within the aggregate portfolio. And in case, if in any of those sub-segments, if the actual — based on the allocation of expenses that have happened to those individual sub-segments, in case if we exceed, then to that extent from a classification standpoint, those amounts are separately required to be given on the face of the profit and loss statement, which is why you find a large amount being reflected there. But equally, when you possibly see the revenue account statement and…

Chetan Thacker — ASK Investment Managers Ltd. — Analyst

There is a counter entry there which I saw, yes. That is moving from shareholder to policyholder and then moving back to the policyholder. Yeah.

Gopal Balachandran — Chief Finance Officer and Chief Risk Officer

Exactly. So, it’s more a classification requirement that is stipulated in so far as regulatory guidelines are concerned. But as I said, for ICICI Lombard at an aggregate level in accordance with the requirement of regulation, we are in compliance with those limits and expenses.

Chetan Thacker — ASK Investment Managers Ltd. — Analyst

That is helpful. That is helpful.

Bhargav Dasgupta — Managing Director and Chief Executive Officer

And coming back to your second question — first question on health. Look, at this stage, Gopal explained the corporate book. It is a high loss ratio business in the 90s, but the cost of sourcing is low so it stays in the — it’s just shade about 100% to 105%. We did it to write that business because that volume also helps us in terms of the network and all the other aspects plus corporate relationships plus we are doing a lot of work with the IL Take Care app with corporates to see what we can do in terms of cross sell and upsell. So that’s something that we want to stay invested, but that’s the kind of range that we expect going ahead.

On the retail, we are investing and that’s when I — in my opening remarks I talked about the overall investment that we’re making in distribution and technology. So retail indemnity, the health agency team that we are scaling up, obviously at this point in time is — these will be highly combined ratio. Our sense is that it will take about a couple of years for us to see that coming in line with our numbers because we want to keep on investing in that segment for some time, at least for the next couple of years.

Chetan Thacker — ASK Investment Managers Ltd. — Analyst

So sir, next five years out, would 95% combined for health be a number that we can work with? So I understand it will be a build-up and then things will scale u, but just wanted a more longer term picture.

Bhargav Dasgupta — Managing Director and Chief Executive Officer

I always — I’m very worried about predicting five year out numbers because none of us predict five year out numbers. My sense is that of course, the combined would obviously come under much better control. I do not believe that the number can be a low-90s that some people articulate. We don’t believe that can sustain in the Indian markets. You have to operate at combined ratios which maybe closer to 100%, not closer to 90%.

Chetan Thacker — ASK Investment Managers Ltd. — Analyst

Got it. That is helpful, sir. Thank you so much for that. All the best.

Operator

Thank you. The next question is from the line of the Prateek Poddar from Nippon India Mutual Fund. Please go ahead.

Prateek Poddar — Nippon India Mutual Fund — Analyst

Yeah. Hi. Sir, just one small clarification. Did I hear you right saying that you have diluted your ROE aspirations for growth and hence the journey to a 100% combined ratio might not be something which we will look for?

Bhargav Dasgupta — Managing Director and Chief Executive Officer

Yes. What we’ve been is that we would want to invest in some of these segments of business, largely digital and health agency. And we had said that while we on the integrated basis on a pro forma basis, we were about 104-odd number. If you look at the 2020 pro forma, we had said that we would want to bring it down closer to our normal target number of 100%, but we do want to invest a bit in terms of scaling up these businesses. Towards that, if the ROE comes down below 20, we are okay. It will be in the high-teens, may not be 20%.

Prateek Poddar — Nippon India Mutual Fund — Analyst

But, sir, is this because of competitive pressures that — or it is just a more strategic question or a subtle test? Like, what I’m saying is for you to — I remember earlier in our conversations always the focus was on ROE and not diluting combined ratios. Looks like there will be some change.

Bhargav Dasgupta — Managing Director and Chief Executive Officer

So, with both — Honestly, if you see the — on the health side, it’s more strategic because of the investment. I mean, if you remember some of the conversations that we’ve had that on the health indemnity side, we were building up some of the capability, both in the outpatient OPD product and the IL Take Care app. Now that we’ve done that, we want to scale up the business. So that’s an–that’s a strategic call. The rest, of course, driven by current context in the market, the market remains very aggressive. Then, we don’t want to kind of lose market share beyond the level. if however, market corrects, there will be an opportunity to bring combined down under — into our comfort zone. But at this point in time, it’s a bit of both, investment both in the agency and also in digital to scale up the business for the future.

Prateek Poddar — Nippon India Mutual Fund — Analyst

Got it. Got it. Thanks. Thanks. Really helpful, sir. Thank you.

Operator

Thank you. The next question is from the line of Hitesh Gulati from Haitong Securities. Please go ahead.

Hitesh Gulati — Haitong Securities — Analyst

Yeah. Thank you for giving me the opportunity. Sir, out of the 88,000 agents that you have mentioned, how many would be selling health for us? And also in continuation with health, ICICI Bank has started selling indemnity. How much of this can be kind of — like go up? What can be the growth path here? And also is there any update on HDFC Bank and Axis selling health for us or — after Bharti AXA partnership?

Bhargav Dasgupta — Managing Director and Chief Executive Officer

Let me take it in the reverse order. So in terms of the key Banca partners that we got through the acquisition, we are very happy with the way those partnerships are developing. As of now, they are primarily focusing on SME and motor products but I’m sure there’ll be opportunities to distribute health in due course. And if you see the growth of that channel while the aggregate Banca partners of BAGI as we said has grown at about 15.9%. I think these two partners have grown even faster. So we are quite happy with the way that those channels are shaping up.

Coming to your question on the bank business, look, I think we’ve been talking about the fact that we had a base effect because of these — decision of the bank not to sell benefit policies for — from Q3 of the previous year, and that had a impact for our this year number for nine months. That — and we’ve been saying that — the — that base effect will play out in this quarter. What the bank has decided to do is rather than selling benefit, they are keen to sell indemnity. So we’ve kind of structured suitable products for the bank and we’ve launched it. I don’t want to give any guidance on whether the number will go up or down because at this point in time, we’ve just started selling some of these products. We will see how it goes along and then we will see what numbers we see. But at least the base — the negative base that we had of the benefit book being there the previous year and that business being stopped this year, that effect has now gone.

Gopal Balachandran — Chief Finance Officer and Chief Risk Officer

And your last question on — Hitesh, on the number of sales agents within that number will be about 6,000.

Hitesh Gulati — Haitong Securities — Analyst

Okay. Sir, so last quarter, we have added about 8,000 to 10,000 agents of — not all of them are obviously health…

Bhargav Dasgupta — Managing Director and Chief Executive Officer

Yeah. We have three separate agency channels. One is motor, one is health, one is SME. Of course, we work across the channels and try to cross sell, but we have dedicated channels for the three segments.

Hitesh Gulati — Haitong Securities — Analyst

Okay. And sir, just one last, if I can squeeze. Our advanced premium number for March is lower than December, so that means motor TP growth is more towards CV, is that understanding correct or it is towards renewal premiums?

Gopal Balachandran — Chief Finance Officer and Chief Risk Officer

Combination of both, Hitesh. I think relatively you’re right to some extent given the fact that let’s say, the contribution of CV in the overall motor growth is also kind of higher in FY ’22 compared to FY ’21. So that’s obviously one contributor. Having said that, I think equally if you look at some of the older — as we are –as what we had said even at the time in this long-term policy guidelines had come in, we had said it will start to kind of peak maybe after attaining almost about three to — between the third and the fourth year, this number of advanced premium will pretty much start to kind of peak because you will obviously start to have — the incremental numbers on advanced premium will be more reflective of what kind of growth that we have — that we will achieve on the motor portfolio, which is what we have seen in FY ’21, ’22. This is the year where it’s been almost about three years since the time the new long-term guidelines had come. So hence, that’s the reason why you see a small dip in so far as the advance premium the numbers at 31st March is concerned.

Bhargav Dasgupta — Managing Director and Chief Executive Officer

The other thing that we’ve been saying that new vehicle sales, both for private car and two wheelers have been quite low. That has also had an impact.

Hitesh Gulati — Haitong Securities — Analyst

Sure, sir. Thank you. That’s it from my side.

Operator

Thank you. Next question is from the line Nidhesh Jain from Investec. Please go ahead.

Nidhesh Jain — Investec India — Analyst

Thanks for the opportunity, sir. Two questions, sir. Firstly, lot of the Insurtech companies are scaling their cross agency business, so how do we view this business, sir? Do we see it as a threat or opportunity for us? Secondly, in the new vehicle — new private cars segment, have we lost — are the market share trends in that segment, have we lost market share or gained market share in last one year, and just in the new private car segment?

Bhargav Dasgupta — Managing Director and Chief Executive Officer

So, Nidhesh, second question first, in the nine months, we lost market share. That’s why our — if you see our motor numbers were quite low — relatively lower in the first nine months. This quarter, we have not lost as much. We’ve lost a little bit in the private car side but made up in the two-wheeler and the CV side for the quarter. And our sense is that even on private car, the re-calibration or the portfolio alignment that we wanted to do given the pricing aggression is largely behind us. So we should — we hope to see market share even in private car segment being held up.

Coming back to your first question on Insurtech, look, in — at this point in time, we are partnering with almost all of them. In terms of whether in the long term it’s positive or negative, there is one positive in terms of them potentially expanding. As of now, they are not expanding the market really because they’re more playing like aggregators aggregating existing agents under their umbrella. But we hope that in due course, they will expand the market and go. And we are — at this point in time, we are working with all of them. On the cross side, we are not with the digital aggregator but on this segment, we are working with them.

Nidhesh Jain — Investec India — Analyst

Sure, sir. Okay. Thank you, sir.

Operator

Thank you. The next question is from the line of Nischint Chawathe from Kotak Securities. Please go ahead.

Nischint Chawathe — Kotak Securities Ltd. — Analyst

Hi. Am I audible?

Operator

Yeah.

Bhargav Dasgupta — Managing Director and Chief Executive Officer

Yes, Nischint.

Nischint Chawathe — Kotak Securities Ltd. — Analyst

Yeah. My question actually pertains to the last two slides of the presentation and I think what you mentioned is that based on the revised disclosures, you have split the reserving triangle disclosure between motor TP and the others. Now, I think what we can see over here is that the relievings in the other segment is higher than motor TP if I look at it, I mean over the years. So how should one really be reading it? What is the interpretation of it? Is it something that we are reserving as a little more conservative in the other segment, or I mean if you could just help us interpret this.

Gopal Balachandran — Chief Finance Officer and Chief Risk Officer

So, Nischint, if you look at so far as approach to reserving is concerned, fundamentally there is no change in terms of the process that we follow. For the current year relative to let’s say what the approach we have been following over the last several years. And the approache is to kind of reserve conservatively at source. And as and when each of this portfolio kind of starts to develop in terms of loss experiences, you will possibly see whether the reserve estimates that we’ve made at source was adequate or not so adequate.

In some of these lines, the conservatism of reserving will start to play out faster. However, in certain long tail lines of businesses that will obviously take a relatively longer time for you to reflect whether the reserve that we carried at source were adequate or not. Slide 29 and 30, the point that you made. other than motor third party, lines of businesses are predominantly businesses which have a relatively shorter tail in so far as claims settlements is concerned, which is why the play-out of the actual loss experience tends to be faster and you are able to kind of see — relative to the amount of reserves that we carry, you are able to see small amounts of reserve releases.

However, in so far as the third party book is concerned, as I said, that’s a book which is long tail. And obviously, it takes a longer horizon before which one can say whether the amount of reserves that we have kind of built in is appropriate or not. Having said that, if you look at the information that gets put out whether it is for motor third party or whether it is for the other lines of businesses other than third party, the information was given for the last 10 years. And you can see over the last 10-year cycles, even after 10 years of development, both with respect to the motor third party triangle that you see as well as the — other than motor third party triangles, this is a loss development experiences. Our approach to reserving has played out to be conservative at source and both of them reflect small amount of reserve releases in the portfolio.

Bhargav Dasgupta — Managing Director and Chief Executive Officer

And if I can add to what Gopal said, we are actually very happy with this disclosure has been managed by the regulator. We’ve been asking for this disclosure for a long, long time. We were the first company to disclose and now we are seeing more disclosures. It’s not just the two pool and aggregate, there are further disclosures of TP business for the running book and the loan degree business, which is a very good development.

Nischint Chawathe — Kotak Securities Ltd. — Analyst

Perfect. Thank you very much.

Operator

Thank you very much. Ladies and gentlemen, we’ll take that as a last question. I now hand the conference over to Mr. Bhargav Dasgupta for closing comments.

Bhargav Dasgupta — Managing Director and Chief Executive Officer

Thank you. Thank you everyone for joining. And again, if you have any other separate questions, feel free to reach out. We’ll be happy to take them separately. Thank you, again.

Gopal Balachandran — Chief Finance Officer and Chief Risk Officer

Thank you so much.

Bhargav Dasgupta — Managing Director and Chief Executive Officer

Take care and good night.

Operator

[Operator Closing Remarks]