General Insurance Corporation of India (NSE: GICRE) Q1 2026 Earnings Call dated Aug. 08, 2025
Corporate Participants:
Unidentified Speaker
Ramaswamy Narayanan — Chairman & Managing Director
Analysts:
Unidentified Participant
Nikita Nanda — Analyst
Aditi Joshi — Analyst
Shubham — Analyst
Ritika Dua — Analyst
Karthikeyan K — Analyst
Anant Mundra — Analyst
Shobhit Sharma — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to General Insurance Corporation of India Q1FY26 earnings conference call. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation comes concludes. Should you need assistance during this conference call, please signal an operator by pressing Star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Nikita from EY. Thank you. And over to you Ms. Nikita.
Nikita Nanda — Analyst
Thank you Amshad. Good morning to all the participants on the call and thanks for joining Q1FY26 earnings call for General Insurance Corporation of India. Please note that we have mailed out the press release and presentation to everyone and you can now see the results on our website and it has been uploaded on the stock exchanges as well. In case you have not received the same, you can write to us and we will be happy to send it over to you. Before we proceed with the calls, let me remind you that the discussion may contain forward looking statements that may involve known or unknown risks, uncertainties and other factors.
It must be viewed in conjunction with our businesses that could cause future results, performance or achievement to differ significantly from what is expressed or implied by such forward looking statements. To take us through the results for the quarter and answer our questions. We have with us the management of GIC represented by Mr. Ramaswamy, chairman and Managing Director and other top members of the management. We will be starting the call with a brief overview of the quarter gone by which will then be followed by the Q and A session. With that said, I now hand over the call to Mr.
Ramaswamy. Over to you sir.
Ramaswamy Narayanan — Chairman & Managing Director
Good morning, I’m Ramaswamy and thank you all very much for joining today’s call. I’ll quickly provide an overview of our performance for this quarter and then we will start the Q and A. The past year has been characterized by persistent global uncertainty driven by inflationary pressures, geopolitical complexities and and escalating climate related risks. These factors have contributed to heightened volatility across financial and insurance markets. Nevertheless, the Indian economy exhibited notable resilience underpinned by robust domestic demand and sustained policy impetus. In spite of these challenges, GIC RE has delivered a robust performance. Our unwavering focus on underwriting discipline, portfolio optimization and strategic alignment enabled us to adeptly navigate market headwinds while preserving operational integrity.
The performance of this quarter reaffirms the resilience of our business model and our steadfast adherence to core reinsurance tenets, rigorous risk management, prudent diversification and disciplined underwriting. While catastrophic events continue to pose formidable challenges to the industry, we remain thoroughly prepared. Supported by comprehensive risk frameworks and actuarial rigor, we have deepened our understanding of market cycles and refined our risk appetite accordingly. Looking forward, we remain confident in our strategic direction. The clarity and discipline we have demonstrated position us well to confront emerging challenges and capitalize on future opportunities with resilience and conviction. We’ll now proceed with a detailed review of our financial performance for the quarter.
The gross premium income of the company was 12388.01 crore for the first quarter ended 3625 as compared to 12405.68 crores for the previous quarter ended the 36th 2024. It needs to be noted that these two quarters are really not very comparable since IRDA has changed the accounting of long term policies in October 2024 to 1n which means that long term policies the premium would be apportioned over the number of years for which the policy is taken. So because of which the premium for the current quarter is lower and overall we do see growth in this quarter.
Incur claims for the quarter is 90.42% for the quarter ended 362025 it is more or less the same as the previous quarter for the previous year which is 89.77%. This is in spite of two large extraordinary losses which have hit our books for the current quarter. Jindal Polyfilms which is a fire loss where the 100% loss figures are 2,300 crores and GIC share is about 925 crores which is fully provided in our books. And of course the unfortunate Air India Aviation loss which happened in Ahmedabad. Both these losses are very adequately provided in our books.
In spite of this the underwriting loss reduced by 30% to 907.76 crores for the quarter ended 3625 as compared to 1288.53 crores for the same quarter last year. Gross investment income has also increased by 18.37% to 3228.51 crores as compared to 2007 27.43 crores for the corresponding quarter last year. Profit before tax has increased by 61.04% to 2002. 43.54 crores as compared to 1393.16 crores for the quarter ended 3624. And the profit after tax has increased by 70% to 1752.22 crores as compared to 1036.36 crores. I would also like to inform that we have started the practice of providing for catastrophic reserve on a quarterly basis and not annually as done previous.
In the previous years. If this were not done, the Pvt and PAT figures would have been higher by 143.47 crores. The solvency ratio is very robust at 3.85 for the current quarter as compared to 3.36 as on 3624. The total assets have increased by 5.89% to 197539.62 crores compared to 1 86552.46 crores for the previous quarter. Net worth of the company has increased by 17.919% to 45275.48 crores as on 36.3625 as against 38635.23 crores for the previous quarter. Net worth of the company including the fair value change account has increased by 4.17% to 89512.55 crores as against 85926.02 crores.
The combined ratio has reduced by 2.66% to 106.94% for the quarter ended with 3625. As against 109.6% for the quarter ended 3624 and as against 108.8% for the entire year 2024 25. I would now like to throw open this for questions that you may have. Thank you.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. To ask a question, please press Star and one. Now the first question is from the line of Aditi Joshi from JP Morgan. Please go ahead.
Aditi Joshi
Yeah, thanks for taking my question. I have a couple of questions. Firstly, on the top line growth, the growth in the international looks to be quite impressive. So is it because of the changes in the credit rating that we have been seeing or is it mainly on the account of rates hardening? So if you can just provide some color on that, as in how much growth is from the new contract, how much is from the rate hardening and on the domestic, it was slightly lower in the international. But going forward, given in the portfolio, such as fire insurance, the price pricing is getting better for the primary insurers.
So what is your outlook of growth in the domestic business, including the fire insurance and motor insurance? So this will be my first question.
Ramaswamy Narayanan
Yeah, thanks, Aditi. Yes, you’re spot on the top line. Growth on the international has grown because of our credit rating improvement which happened in October last year, which gave us a chance to look at really good businesses on the 1st of January and we managed to write a substantial amount of increase there. So to quickly address your question, it’s not because of rate hardening, it is because of new businesses that we have written on the 1st of January, which is now coming into our books for this year. In fact, I would say that for the 1st of January the market was pretty soft and we did see rate softening.
But then like I said, because of our credit rating upgrade, we got to see some really good pieces of business, both new as well as those that we had written earlier, which we had lost due to our credit rating downgrade, but we managed to get that back. So these are all basically new businesses in our books that you are seeing the increase. So secondly, on the domestic side, yes, again you’re spot on in saying that the property premium today looks a little subdued simply because quarter on quarter, when you compare, you are comparing two different quarters.
In the last quarter the premium of long term policies were fully accounted for. Today we have apportioned them across the different years for which the policy is taken. So to that extent the property premium would be subdued. Again, on the domestic front, we’ve been trying very hard to ensure that the primary insurance rates stay and it is more or less held on till now. So we are very confident that that will continue to happen during the year we are in touch with. And especially the rates on the primary side is in a position where it is viable for the market to continue writing at those rates and it gives a certain amount of positiveness to the entire portfolio.
So yes, going forward, fire premium would go up and I think it would be definitely higher than what it was for the entire year last year on the Domestic side we have regrown a bit on the health like you would have seen last year our growth on health was substantial and it was on the retail health side this year when we did the analysis of how it is progressing and how it is performing some of the treaties we felt was not doing the way we wanted it to. There is obviously medical inflation that is coming up and you know, some of the losses have really crept up during the year.
So we have not renewed a couple of treaties that we wrote last year. So to that extent health will be slightly down. But overall we are also writing in new classes of business like surety and cyber and trade, credit, etc. So that gives us a diversification in our book as well as you know, provides a growth. So going forward we would look at this year maybe for the entire year. We expect the growth to be between 9 and 10% compared to last year.
Aditi Joshi
This 9 and 10% is in domestic or overall?
Ramaswamy Narayanan
Overall. Overall, overall, overall. So typically international would grow about 17 to 20% year on year for this year and domestic would be about six and a half or seven percent.
Aditi Joshi
Okay, understood. Thanks so much for that. If can I also squeeze in one more on your expense ratio was slightly better. I mean it was a lot better in this quarter as compared to the same quarter last year. So what would be the reason behind that?
Ramaswamy Narayanan
So two things. One on the, on the salaries, on the employee compensation, what happens is we do provide for the pensions and gratuity for employees based on actuarial calculations there has been a dip in that for the current quarter compared to last year’s quarter. Plus I think on the IT side the spending that we have done last quarter compared to this quarter, it was more last quarter. So to that extent we have got a deficit.
Aditi Joshi
Okay. So what I’m trying to understand is that the expense ratio outlook for the rest of the year and for the coming quarters. So I guess IT spending can be up and down maybe quarter on quarter. But it looks like this salary, employee salary compensation can continue possibly.
Ramaswamy Narayanan
Yes, it will more or less. It will more or less carry at this, at this rate because whatever changes that is, that is you know, looked at, we’ve kind of already provided for it. Right. So honestly. But Aditi, the point is you look at our expense ratio, it’s less than 1%. Honestly it’s not something that is going to move the needle. It’s not going to go up from 1% to 5%. It will only change between maybe a 0.9% to 1.1%. So honestly, it’s not something that is going to move the needle as far as the combined ratios go.
Thank you.
operator
Thank you. Ladies and gentlemen, in order to ask a question, please press star and one. Now the next question is from the line of Shubham, an individual investor. Please go ahead.
Shubham
Hello. Congratulations on a fantastic set of numbers. I had a couple of questions. So one was on the expense ratio. You also see the commission going down from 19 20% to 16%. So what has led to this lower commission and would this like normalize back to 1920% for the entire year?
Ramaswamy Narayanan
Well, yes. So this is more a one off I would say for this quarter. Basically the initial commissions that we charge and then depending on the profitability of the portfolio, the commissions would go up or down. That’s how typically it works. So I would say this is a one off going forward we will see that it kind of settles down around 18, 19% for the year.
Shubham
Okay. Because almost, I think 300 crores is like the savings from commission for this.
Ramaswamy Narayanan
What I said typically what would happen is as the, as the quarters, you know, advance as we come closer to the end of the year, depending on the profitability of the treaties, the commissions would change. So it will all depend on how these treaties perform over the next three quarters. And then typically the commissions, we would see how it settles.
Shubham
Got it. And second question was in general like what’s the strategy for you know, booking the investment income? Because ultimately that is the one which is driving our bottom line. So do we have any specific strategy that every quarter or every year this is how much, you know, we have to keep booking to bring a certain level of that?
Ramaswamy Narayanan
No, Shubham, it’s not like that. Now let us understand our investment book. You know, over the 100%, about 74, 75% is debt. Right. And so there is no question of we deciding when to book and how to book. This typically means that for the 75% of our book the interest would come in at the normal time. It gets booked each quarter. Right. It also means that to a great extent our book is held to maturity. So you know, we have kind of ensured that the higher rates at which we purchase some of these debts continues.
So, you know, we end up getting a good amount of interest on that. What you are talking about in terms of is about profit on investment of, I’m sorry, profit on sale of investment equity. So let me be very honest, we don’t really try to sell investment just to prop up our bottom line. That is not what we do. When we do Sell it is just because we feel that a particular sector is kind of run up well and reached the end of where it should be and then we decide to sell. If a stock or a sector is become suddenly overheated, we would then kind of sell it and maybe wait and purchase it at a later time.
So these are strategies for which the investment department there are. Unless there are officers who look at these things in detail and present their recommendation as to what we do. Honestly, we don’t really sell equity just to show profit on our books. That’s not something that we do. Again, we also need to understand that maybe two years down the line IFRS is going to come in. So we need to be ready for that. So for that, whatever strategy we need to do, we will do. But at this stage, I think the investment book is, is in a very comfortable space.
Like I said, a major part of that is debt, where the interest keeps coming irrespective of how the stock market functions. So again, I have said this earlier also that whatever risk appetite we have, whatever risk we want to take, we take it in our business. We don’t take it in our investment. Our investment is normally very, very safe. We don’t play around with that. And I think it’s in a good space now.
Shubham
Got it. Thanks for the clarification. And finally, on our network, so the way we account it in our books is at the book value that is excluding your fair value changes. Is this in line with what, let’s say the other private insurers could be general or life insurers, you know, follow, or this is something which we are following separately.
Ramaswamy Narayanan
So this is how typically every insurer would be asked to follow by irda. So IRDA says that everything should be accounted for in book value. We also show it in fair value because, you know, when our international rating agencies look at us, they look at us from a, you know, market value perspective. Which is why we provide you with both flavors. Of course, going forward, as I said again, once India comes in, everything would be on market value. So at that time, obviously everything on market, currently, everything is on.
Shubham
Got it. And the ROE which we are showing, let’s say now, it’s in the range of 18, 20% because your network is, let’s say, on the lower side because of the exclusion of fair value changes. Once the ifrs and all comes in, would your ROE continue to be in that level or it would automatically drop because of higher network?
Ramaswamy Narayanan
They will still need to find that subam. We are still working on it. So IFRS is something that, you know, our team is working on. Hopefully we will not even wait for the dates that IRDA has given for implementation. We will actually start doing that much earlier and we will be in a position to hopefully give you both the figures. The I GAAP as well as the India’s figures may be from the third quarter of this year. So you as an investor or as an analyst may actually get to see how the books would look once IFRS comes into play.
We are still working on it. So I may not be able to give you a hundred percent answer now as to, you know, whether the ROE will change because honestly it’s not dependent only on the investment fair value. It depends also on how the how the overall underwriting looks. So there will be multiple factors there.
Shubham
Got it? No. Thanks a lot for this clarification. That’s it from my side.
Ramaswamy Narayanan
Thank you.
operator
Thank you. Before we take the next question, we would like to remind the participants to press star and one to ask a question. The next question is from the line of Hrithika Duva. Please go ahead.
Ritika Dua
Sir. Thank you for the opportunity. While sir, I heard you on the IFRS thing that we are going to share from third quarter, not sharing any numbers but sir, generally could you maybe highlight some of the changes that are we going to see when we move to ifrs? So like with some of the other general insurers, obviously we have some, you know, understanding as to at least the broad changes that are expected as to, you know, once we move from move to rather ifrs. Could you just give us a broad understanding then without any numbers.
Ramaswamy Narayanan
So essentially it will affect us both in terms of the business performance, which is our core activity, which is reinsurance as well as on the investment side, on the core business side, we do believe that it will be beneficial for us. IFRs will be beneficial. The way the business will be shown will definitely be beneficial. We have seen how other companies have done it in markets where we are present and once IFRS comes in, the results actually look better on the underwriting side. So we believe the same should happen for us. Like I said, we are still in the process of working that out, understanding our book and putting in the data.
On the investment side, what would happen is, like I said, it will be taken on market value basis. So it would mean that any dip in the market would actually get reflected negatively for us in case we are showing depreciation in our values today. That does not happen because to an extent what happens is only the book value is seen. Any change in the fair value does not really come and hit our books currently. So to that extent we will need to manage our investment in a different way. I guess we will start. I think the investment section will have to start working like a mutual fund managing the navs on a day to day basis, ensuring that the churn happens in a way that we are able to kind of roll over the negativity of the market.
So that is again something that we are working on. There are strategies in place to manage that. But the way I see it is in case India comes in, it should definitely be beneficial to us in the long run.
Ritika Dua
Sure, that’s helpful. Maybe I’ll take it up offline. Thank you.
Ramaswamy Narayanan
Sure. Thank you.
operator
Thank you. The next question is from the line of Karthiken K. An individual investor. Please go ahead.
Karthikeyan K
Yeah, hi to everyone. Good morning and thanks for the opportunity. So I have a few questions regarding a foreign portfolio. Like see we have sort of stopped writing, you know, foreign portfolio with respect to mortar and marine. But still we are incurring losses there. Right. So how is it going to look going forward from this financial year?
Ramaswamy Narayanan
So yeah, I mean I wouldn’t say we have stopped completely Motor and Marine, but then we are careful about the kind of business that we write. So we do continue to write Motor and Marine. Marine is a worldwide book anyway. And Motor also there are specific markets from where we write business. Having said that, you know, there was a particular contract in the US which was for Marine and Motor which we had stopped in 21. The runoff of that continues to come in and even though it is very adequately.
operator
Ladies and gentlemen, we seem to have lost the connection with the management. Please stay connected while we rejoin the management. Ladies and gentlemen, we have the management back online with us. Please go ahead, sir.
Ramaswamy Narayanan
Yeah, Karthikan, sorry about that. So what I was saying is Marine and Motor we do continue to write since these are books that you know, we get to see from different markets. But a particular contract from the US which we have stopped in 2021, the runoff continues to come in terms of. So earlier both the premium and claims used to come. Now the premium has stopped. Now it’s only the claims. But then these are adequately provided in our books. What you get to see is the payments that we are doing for these, for these classes.
Karthikeyan K
Okay, that is still continuing, right? There are runoff and the claims are coming still. So how long do you think that that’s going to happen? How long? I mean any, any timeline or. It is not possible to provide any timeline.
Ramaswamy Narayanan
I Guess Marine is kind of done now. And if you see it reflects in the loss ratios as well. Motor is where we would expect. I mean typically Motor third party is a. Is a long tailed class. We would possibly expect this to go on for another two to three years. It’s actually come down. The actual amounts of if you see have really come down. But over the next two to three years we’ll still see some claims coming in from. From motor. Yes.
Karthikeyan K
Another question is like the. You said that there is a major impact with the aviation. But there is a line item which says other miscellaneous. Where we have where the underwriting was almost 400 crores. Is that also related to aviation or something else?
Ramaswamy Narayanan
There will be. It is not related. Miscellaneous classes. Yeah. No, no. He’s asking whether that is related to the aviation loss to an extent. Karthikeyan. It would be. Let me also clarify. So when we talk about the aviation loss per se. So there are multiple classes that are involved in this law. I am talking of the Air India unfortunate Air India crash that happened in Ahmedabad. Now there are multiple classes which get involved because you know people would. This was an international flight. So people would have taken travel policies that will trigger. There’ll be losses paid there.
PA policies that people would have taken that would trigger life insurance policies that are taken that would trigger there will be some losses coming out of Marine. And then over and above all this would be the fleet policy which Air India has taken through which you know, the hull loss will be paid which is almost $125 million. 100%. And there will be liability losses for the passengers who lost their lives. Plus since unfortunately the plane crashed in a building where there were doctors, obviously the third party liability will also be high. So there are multiple areas from where losses would come for this particular loss that we are talking about.
Karthikeyan K
Collectively put, what will be the quantum of the loss?
Ramaswamy Narayanan
Again, the market is coming to terms. There are different views about it. There are people who are saying it could be 200 to $250. We believe it could be closer to 400 to $450 million. You know, because again like I said, there are multiple classes getting involved. The liability could be higher than what people are thinking because even though the Montreal Convention specifies what should be paid, we could have a situation where people might get higher payouts than that. Again, the third party loss should work out to be higher because these are all professionals who have lost their lives.
So obviously to that extent the award could be higher. So the market is still coming to terms with it maybe going forward we will reach a landing on the actual figures.
Karthikeyan K
With regards to Obligatory business. What will be the combined ratio there, sir, for us? I mean, I mean, over the years, I mean, what it has been, I mean, like how it has progressed, you know, from currently, what is the comment issue in the Obligatory business?
Ramaswamy Narayanan
So it will be more or less reflecting the combined of our domestic business. Okay, so if you look at our domestic business, it currently is at around 104% first last couple of years, it’s kind of hovering around that figure. And Obligatory would also be around that, because even though the market today, the insurance market today is at a combined of maybe 118 or something, I think as a company we have managed to, you know, do better than the market, which reflects in our overall domestic book. And the same would be true for Obligatory as well.
Karthikeyan K
Okay, if life business is an obligatory or major part, is obligatory or non obligatory life, there is no obligatory.
Ramaswamy Narayanan
It’s only for non life.
Karthikeyan K
Okay?
Ramaswamy Narayanan
Life is purely the business that we write voluntarily. There’s no obligatory there.
Karthikeyan K
Yeah, but why is it we are seeing, you know, losses continuously for several quarters, the underwriting part.
Ramaswamy Narayanan
So it’s more about, you know, the company ramping up its reserves. So what happens is life is a long tailed policy, long tailed class. Normally policies taken are in the range of 25, 30 years. So for some of the treaties that we have written in the past years, maybe 10, 12 years back, if we see that the performance is not as we wanted it to be, then we would provide reserves to ensure that there is no shock coming in the later years. And that is what we have done. Typically after Covid, we did expect some kind of stability to happen in the portfolio which did not seem to be there.
The losses seem to be coming more than what we expected. And that is where we have kind of ensured that our provisioning is in line with the losses that we see. So this is something that we will continue to do for a long tail class like life, where we will continue to monitor the claims that are coming in vis a vis the provisioning. We have made for the same and depending on how they move, the provisioning will change.
Karthikeyan K
We have not seen much of a competition, right? Whatever competition which come from like FRBs and you know, the other which we don’t have any legal presence in India. So going forward there are no new, I mean, new companies are getting now created, the reinsurance part. So how are we planning to, you know, you know, tackle that with the competition and what kind of strategy we’re Going to follow there and we have legal entities coming in.
Ramaswamy Narayanan
Karthikeyan, I will not agree with you there that we have not seen competition in this market. I think we have seen all the competition that we wanted to see. FRBs even before they set up here. They did have presence in this market and after coming in they have competed with us. We have been seeing price softness happening due to higher capacity being available. There are enough number of almost 300 numbers of cross border reinsurers who are working in this market. So I don’t see a situation where we have worked in an environment where there has been no competition.
I think competition has been there and honestly as a company we have welcomed that simply because getting more reinsurance capacity in this market means that the insurance market will develop. There is a lot of scope for insurance growth to happen. The penetration levels are at 1% or maybe less than that for non life. Obviously it needs to go up. The government is pushing for that, regulator is pushing for that insurance for all by 2047. I think seeing how companies are in this market, the insurance companies, the fact that majority of them are privately owned means that as and when they grow they will look to reinsurance for supporting their growth.
So we welcome more and more people to get into the reinsurance market. Then it will also help us to write the kind of business that we want to write. Because the kind of relationship we have with all these insurance companies are relationships that go back very many years. They know what kind of capacities we can give, what kind of expertise we provide and what kind of support we provide in this market. So we don’t mind competition as long as people understand what they are writing and they are able to put in that kind of capacities.
We are more than happy to have them. Having said that, new companies will take some time to settle down because reinsurance is a, is a, is a game of deep pockets. You need to have lot of capacities, you need to have a lot of staying power. And if they have that, more than happy to welcome competition in this market.
Karthikeyan K
So what kind of strategy do we have? I mean are you planning for like the foreign portfolio? You said that the growth will be in the range of 17 to 20%. So that’s going to be for the longer term. Right? You don’t specifically mention that for this year. I mean can we see that going forward for next two, three years?
Ramaswamy Narayanan
Yes, yes it will. All that’s how we are planning it. That you know international grow about 17 to 20% year on year and domestic would grow about 7 to 8%. Where we are factored in the fact that there will be more competition in the domestic market, number one. Number two, on the international side, the confidence comes from the fact that, you know, we used to write a lot of business in the past which we lost. Some of the good businesses that we lost due to the credit rating downgrade that we suffered in 2020. Having got the rating back, having maintained our relationships with all these companies, we are confident that we will get back those businesses that we lost.
We’ve already started, we are already in the market, we’ve already got some part of the shares for all the businesses that we lost. So it’s a question of ramping that up going forward. Also getting to see some really good international businesses which have come up in the last few years and writing that. So the confidence comes from that. Like I said earlier, we’ve also provided for the fact or taken on board the fact that there will be competition in the domestic market. Having said that, if the market grows the way it is expected to grow, we don’t expect any diminution in our participation in this market.
The shares might come down, but then the overall market will anyway go up. So our business, our capacities in the market will continue. So which is why we are very confident that in the next medium term we will definitely be able to write the business that we are looking for. But again, the biggest challenge and the biggest driver for us is that the business that we write should be profitable. We are not writing business just for increasing our top line. We are not in that game. We want to ensure that every piece of business that we write brings profitability to us, increases our margin and overall helps us in, you know, improving our net worth.
Karthikeyan K
One last question I have is like the combined has come down during the first quarter for the foreign portfolio. So what will be like for this financial year going forward? The combined for the foreign portfolio.
Ramaswamy Narayanan
So we are expecting that the combined will be. So it’s not, I mean if you’re asking whether this is a one off, it’s not. It is something that we expect that it will continue going forward. For this year. The combined for the foreign for this year, we honestly expect it to be closer to where it is now. Maybe it will improve a little more than what it is currently. So I think if you see overall we are looking at a combined of around 107, 106.8, 107 for this year in which overall the domestic will continue to be at around 104, 105 and foreign will Come much better than what it was last year.
I think it will come closer to 110% is my feeling.
Karthikeyan K
Okay. So thank you and that’s all I have. All the best.
Ramaswamy Narayanan
Thank you. Thanks a lot.
operator
Thank you. Participants who wish to ask a question may press star and one now. To ask a question, please press Star and one now. The next question is from the line of Anant Mundra from my Temple Capital. Please go ahead.
Anant Mundra
Hello. Thank you for the opportunity, sir. I just wanted to understand the investment book better. So just wanted to get a sense like what is the restriction? Are there any regulatory restrictions on us to invest in say equities versus fixed income? And could you just highlight that? How much of our policyholders book can we invest in fixed instruments versus equity and how much of the shareholder can we invest in fixed instruments versus equity?
Ramaswamy Narayanan
Okay, I can give you something briefly if you want more details. I’ll get my CAO to talk on this. The point is there are no restrictions. Yes, there are some restrictions which IRDA put in, but they don’t say that, you know, you should put only so much into equity or anything or we should not put it into equity. I think this discipline is something that we have set upon ourselves because we are also rated by international credit rating agencies and they want to ensure that the investment book is very, very safe, very, very liquid and doesn’t throw up shocks.
And like I said, we try to keep our investment book very safe. Having said that, you asked whether there is any specific policy for policyholders funds vis a vis shareholders funds. We don’t do that. The entire fund is taken together and within that we decide how much we will have it in debt. So like I said, 74% currently is in debt. About 17 to 18% is equity and typically about 8% is money market. Money market is more FDS and Liquid Mutual funds simply because we need the money to pay claims as and when it comes.
So this is very simple. We keep it very simple idea is to maintain the equity around the same stage because you know, that gives us the right kind of investment income that we want every quarter in our books. Otherwise, I mean, there are certain restrictions which IRDA puts as to, you know, you must have certain percentage in housing, certain percentage in infrastructure, something in government bonds and things like that. But those we are very clearly following, there is no problem.
Anant Mundra
Got it, Got it. So currently, what is the run rate of our fixed income that comes in from quarterly without if I exclude the capital gain, basically. So how much. You wanted the rate of interest? Is it no no, the quarterly run. Rate of the investment income that we. Are receiving right now. So it’s about say 2000 crores quarterly is fixed kind of income that we will surely get whether we book any equity gains or not. Something of that sort. Like some color on that.
Ramaswamy Narayanan
Yeah, yeah. So let me quickly come. So we. So we showed 3230.26 crores for this quarter out of which 1074 crores is profit on sale of investment interest and dividend together is about 18,850 crores. There is, you know we do have branches and operations abroad. We keep that money outside in international funds. That bank interest is about 167 crores. And there is also some businesses who keep our premium for some time. So there is a interest on reserve deposits of about 131crores. So to come back to your point may be interest and dividends which is something that comes on a return regular basis for us that’s about 1850 crores.
And profit on sale of investment is about 1074 crores. This is for this quarter and this is kind of expected to continue.
Anant Mundra
Just one more thing.
operator
Sorry to interrupt sir, but I may request you to rejoin the question queue for follow up questions. Thank you.
Ramaswamy Narayanan
Thank you.
operator
The next question is from the line of Shobit Sharma from HDFC Securities. Please go ahead.
Shobhit Sharma
Yeah. Hi sir, thank you for the opportunity. Sorry I joined a bit late. So sir, my first question is on the growth in the motor segment. So on the direct side if you look at industry hasn’t grown that much. Some of the PSU players have been very aggressive on that side. So was this a one off quarter for you in the motor side? And secondly how has been our experience the revision in the pricing primarily on the property segment wherein we have seen last year there was a steep decline in the rates. And I have another follow up question on the lob wise loss ratio specifically on the motor health and fire segment.
If you can break that in two. Another thing which I wanted to ask you is for the quarter our net commission ratio has reduced considerably. So have we rationalized the commission rates we have offered to the insurers? Can you help us understand what has led to that? And lastly on the one small thing, data keeping on the capital gain you mentioned for the quarter this quarter you have booked 1 74, 1174 cr. Can you give us same number for last year, same quarter and what was the total capital gain realized in FY25? Yeah, thank you.
Ramaswamy Narayanan
Sure. Okay, so let me try and take this point by point, first, motor, you asked where is the growth coming from? So yes, there isn’t been much of a growth on the direct side, but we’ve also been writing some new treaties on motor where we have been supporting some of our partners. So that is where our growth is coming from. Earlier motor used to be almost predominantly obligatory. Major part of that used to be obligatory, but now there are a lot more treaties that we write with some of the companies on motor. So that is where our growth is coming from.
Secondly, you asked about revision in pricing on property. Yes, that is something that we are very closely monitoring and we try to ensure and get people on the same page in terms of pricing to ensure that there is viability in the property market. On the direct side, you asked how does that affect us? Honestly, property is majorly proportional capacity that we provide in the market. So if the pricing on the direct side improves and the premium increases, we obviously get the benefit of it. So yes, we would be looking to get the benefit of that.
It has not happened, or rather you would not see it in the first quarter comparison with the first quarter of the previous year, because like I said, there is a change in the way long term policies are accounted for. Earlier it used to be booked in the same quarter. Now it is apportioned for the different years for which it is bought. So to that extent it will actually look flat or even slightly lower. But going forward, by the end of the year you will see that property premium are higher than what it was last year.
You also wanted to know about the commission. So yes, the commission looks low at this stage because typically what would happen is when treaties are signed, commissions are started at a certain level and then depending on the profitability of the portfolio, the commissions would go up or down. We expect the portfolio to be profitable this year. Like I said, the pricing has gone up. Hopefully catastrophic losses will be comparatively lower than previous years because rains have been good. We have not heard of headline making floods happening in this part of the country. We have also not heard anything on the international side, but we are monitoring that.
So depending on how the portfolio performs, you would expect commissions to go up in case it works better. Our own feel is that, you know, as the year goes through and we reach towards the end of the year, the commissions would be more or less at the same levels as last year. You also asked about the capital gains, 1074 crores that we booked this year for 3624, it was 790 crores. And for the whole year of 31,325, it was 4108 crores. So I mean going by what we have booked we can expect it to be around the same level or even slightly higher for the entire year.
Shobhit Sharma
Can you help us understand the lob wise loss ratios? Because there is significant improvement in the loss ratio despite the two large losses which we have accounted for this quarter. So was this driven by the motor health or fire segment?
Ramaswamy Narayanan
Let me quickly have a look at this. So some of the improvements that I see compared to previous year, basically quarter on quarter, fire is more or less the same. I think the improvement has come from motor. No, not really motor on a combined. Yeah, it’s more from agri, maybe a bit of help. And yeah, these are the ones that have contributed to the improvement. Of course engineering comparatively a smaller class, but that is shown profitability. These are the three main classes. Overall motor looks good now compared to earlier years. Property also is matching up because if I see the overall combined combined for fire is at around 106.
Motor is 107. Health has come down to 111. Agri at 86. But honestly agri should go up a little as the year goes by. Cargo has come down. It was a class which internationally we had issues with that has come down to 104. Hull is at 44. But again this will be a one off. So I think overall each of the classes have performed better idea would be to bring it, you know, to better it going forward. It will all of course depend on how the, how the catastrophes work out in the next two quarters.
Shobhit Sharma
Okay sir, and last question. On the retail, retail insurance segments, primarily the motor, retail health, we have seen insurance companies retaining most of the risk on their net. Do you believe that there is an appetite for these insurance companies to cede that business to the reinsurers? Just your views on that, sir?
Ramaswamy Narayanan
Well, we are seeing them do it. So like I said, you know, the growth that happened in motor, which is your question, that in the primary market there was no growth, but where did we grow? So that growth is basically in retail motor, you know, so some of the treaties that we have written, where it used to be earlier kept by the insurance companies, now they have ceded it to us. So on the retail side you are right in saying that individual policies are small tickets, so the companies have the capacity to retain. But as they start writing more and more they will obviously need to put in more capital.
If you see this market barring for maybe four or five companies who are listed in the market Rest are privately owned. So obviously there will be a problem in getting the kind of capital that is required. And normally in that kind of a situation, it is the reinsurers who will be putting their capacity and driving up the capacity in the market. And that is what we see happening and going forward. Also to your question, whether we see this happening, I think once RBC comes into play, what we would typically see is the capital would come down, the solvency ratios would come down for the market, and rather than quickly looking to get capital in, they might look for reinsurance capacities.
So that is one reason why we have kept our solvency at a higher level and not really soliciting business at this stage, because we would rather wait and write profitable business which would come to our side when RBC kicks in.
Shobhit Sharma
Okay, sir, thanks. Thank you, sir. This. This answers my question. Thank you. And all the best.
Ramaswamy Narayanan
Thank you. Thank you, Shobh.
operator
Thank you. The next question is on the line of Hrithika Duva from Bandhan amc. Please go ahead.
Ritika Dua
My apologies, if you could just reiterate the guidance you gave on combined ratio for the overseas business and also if you could just break that down, because if I heard the number correctly, then there was a meaningful improvement that you’re expecting. And is this meaningful improvement largely a function of maybe, you know, we have already provisioned for the law, you know, for the businesses, well written and we don’t expect any. Or how does that really improvement work is if you could help understand. So that’s the first question.
Ramaswamy Narayanan
Okay, so let me just give you a feel on this. So for the current year, so last year we ended with a, with a combined ratio of 108.8, where typically the foreign was at 126 and domestic was at 104. This year we are expecting that to come down by at least a percent, maybe slightly more. So the combined should be closer to 107, 107.5 is what we believe it will be. And a major part of that improvement would come from international because I think domestic. If you see we are currently at 104.5 or something where I think that’s a good position to be in.
I don’t think we will be in the short term able to do better than this on the domestic simply because you see the overall market, it is running at a combined of 116 to 118. And we are already doing much better than the insurance market. So our improvement will happen on the foreign side. And what we believe is, you know, from 126, we should ideally be coming to around 118. 116 is what we would be looking at for this year.
Ritika Dua
We are already 118 for the quarter. So you said that we could be 116 for the year, roughly.
Ramaswamy Narayanan
Exactly, exactly. There are 2 quarters. I mean the coming 2 quarters, which is the July, August, September and the October, November, December are internationally the two quarters where you get catastrophic losses. So we need to really monitor that and see how that works. Fortunately, we have still not received any advisories of any major CAT event happening in any of the markets. So we are sanguine about, you know, getting a much better combined ratio. But I guess as the quarters move on, you will get a much clearer picture on the combined.
Ritika Dua
One second question is a little more accounting. So for all the unlisted investments in the unlisted space that we have, how do we account for the same and especially on. Even if they are obviously marked up on a fair value basis, what is our. When does the markup really happen and what is the basis for the same? Also, if you could share that.
Ramaswamy Narayanan
Well, honestly, the number of unlisted companies are very, very less in our books. Having said that, the unlisted companies would be accounted for on book value basis only at this stage. We don’t really mark it up unless it gets listed.
Ritika Dua
Okay. Okay, that’s helpful, sir. Thank you.
Ramaswamy Narayanan
Thank you.
operator
Thank you. Ladies and gentlemen, this would be our last question for today. I would now like to hand the conference over to the management for closing comments.
Ramaswamy Narayanan
Thank you everyone for your questions, your comments, your suggestions. They mean a lot to us and honestly, over the years they have opened our eyes to looking at our business in different ways. I am hoping that the consistency of our performance this quarter would give you the confidence that it reflects our disciplined execution, a focused strategic approach and prudent risk management. These efforts have positioned us to pursue operations.
operator
Ladies and gentlemen, we seem to have lost the connection with the management. Please stay connected while we rejoin the management. So you may proceed.
Ramaswamy Narayanan
Yeah, I’m sorry about that. But hopefully, like I said, our efforts have positioned us to pursue opportunities that align with our risk appetite and support our long term vision for sustainable value creation. And I hope that gives you the confidence about how this company will perform going forward. On a very personal front, I’ll be laying down office at the end of September and so this is most probably the last time that I’ll be interacting with all of you on this platform. I would like to take this opportunity to thank all of you for the support that you have given to gic, the interactions that we have had and the interest that you have shown in us.
I have learned a lot from these interactions and have taken heart from the positive vibes and comments that have come from you. I hope our performances have given you the confidence in our business and the strength that our balance sheet has and that you will continue to support this company and my successor in the years to come. I wish you all the very best in your future endeavors. Thank you. Once again.
operator
Thank you on behalf of General Insurance Corporation of India. That concludes this conference. Thank you for joining us and you may now disconnect your lines.
Ramaswamy Narayanan
Thank you.