General Insurance Corporation of India (NSE: GICRE) Q3 2026 Earnings Call dated Feb. 11, 2026
Corporate Participants:
Hitesh Joshi — Executive Director
Sanjay Vasant Mokashi — Chief Underwriting Officer
Ms Nikitha — EY
Analysts:
Janisha — Analyst
Madhukar Ladha — Analyst
Sanket Godha — Analyst
Shobhat Sharma — Analyst
K.Karthikyan — Analyst
Ritika Dua — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the General Insurance Corporation of India Q3FY26 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 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 to Ms. Nikita from EY. Thank you. And over to you ma’. Am.
Ms Nikitha — EY
Thank you. Mark. Good morning all the participants in the call and thanks for joining Q3FY26 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 exchange as well. In case you have not received the same, you can write to us and we’ll be happy to send it over. Before we proceed with the call, 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 Mr. Hitesh Joshi, Executive Director, Additional Charge of CMD and other top members of the management at GIC. We will be starting the call with a brief overview of the quarter gone by, which will then be followed by this Q and A session. With that said, I’ll now hand over the call to Mr.
Joshi. Over to you sir.
Hitesh Joshi — Executive Director
Good morning ladies and gentlemen and thank you for joining us for GIC. Reese earnings call for the third quarter of FY26, the global insurance market is moving into a more balanced phase following a period of structured hardening. While rate momentum has moderated across certain lines, underlying risk conditions remain elevated driven by climate related volatility, inflation in lost costs, geopolitical developments and a higher cost of capital. Accordingly, capital across the industry is being deployed with greater sensitivity, selectivity and technical vigor. Investment yields continue to support overall earnings even as underwriting margins gradually normalize. In parallel, reinsurance are reassessing legacy assumptions across long tail and life portfolios, strengthening reserves and reinforcing pricing governance to enhance balance sheet resilience and long term sustainability.
Market outcomes at recent renewals have become increasingly influenced by individual portfolio performance rather than broadcast cyclical momentum. While competitive pressures are incrementally returning, pricing remains broadly rational where risk adjusted returns are appropriately compensated. The prevailing focus across the sector is therefore on margin protection rather than volume led expansion. For investors, this environment emphasizes the importance of underwriting quality, capital discipline and consistent execution. GIC remains aligned with these principles through continued portfolio optimization, prudent risk appetite and a strong capital position. Against this backdrop, I will now highlight our financial performance for the quarter and the nine months ended 31st December 2025.
Gross premium income for the Q3 FY26 to date Rupees 10,986.55 crore as compared to Rupees 9,967.71 crore in the corresponding quarter of the previous year. Incurred claim ratio for the quarter is 87.9 as against 87.8 in the previous corresponding quarter of the previous year. Combined ratio for the quarter stood at 105.32 compared to 107.83. Adjusted combined ratio improved to 85.08% or nine months as against 89.12% for the similar period of the previous year. Investment income for Q3FY26 to date Rupees 2924.47 crore compared to Rupees 2627.17 crore in the corresponding quarter of the previous year. Profit before tax for the quarters to date Rupees 2116.93 crore compared to 2168.69 crores.
Profit after tax for the quarter stood at Rupees 1518.92 crore compared to Rupees 16.21.35 crore. Solvency ratio improved to 3.87 as of 31st December 25th compared to 3.52 as at 31st December 2024. Net worth excluding fair value change recorded at Rupees 48490.40 crore as on 31st December 25th compared to Rupees 40745.48 crore as on 31st December 2024. Net worth including fair value change today Rupees 92056.08 crore compared to Rupees 85803.69 crore in the previous year and the premium breakup domestic premium for nine months is Rupees 25,388.97 crore. An international premium is Rupees 7,587.29 crore, with a percentage split of 77% domestic and 23% international.
Before concluding, I would like to thank our shareholders, clients and employees for their continued confidence and support. Looking ahead, we anticipate further normalization of market conditions with financial performance increasingly driven by disciplined underwriting and effective claims management rather than cyclical pleasing tailwinds. While this may moderate growth rates, it supports the delivery of stable and sustainable returns over the long term. Thank you. We can now move to questions and answers.
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. Participants who wish to ask a question may press star and one on their touchstone telephone. Participants who wish to join the question queue may press star and one on their touchstone telephone.
The first question is from the line of Janisha, an individual investor. Please go ahead.
Janisha
Yes, sir. Thank you for the opportunity and congratulations for the good set of numbers. Two, three questions. One with regard to the combined ratio which is now coming more closer to 106 and how do you see the trend going ahead especially in this year? And we have a target of reaching up to 100% next few years. So how are we. How are we tracking that for next couple of years given the international book now will start contributing. The new book actually will start contributing to in the next from next year onwards. That is first part.
Second, if you can just give some understanding about the book composition. I think you have right now some 38% of your revenue now coming from obligatory segment. And how is the combined ratio out there? I mean you have been sharing the combined ratio for international and domestic. But when it comes to obligatory and non obligatory parts, if you can give a little bit of a more understanding that will be helpful. And also your outlook on the obligatory part. How is. How do you see the narratives or the discussions with the government with regard to continuing with the same set or same rate obligatory or there’s likely to be a reduction in that rate as well in the near future or maybe in the medium term that will be helpful.
Thank you, sir.
Hitesh Joshi
Thank you. Regarding your first question, how the year will pan out as we have Been advising the investing community that fourth quarter tends to be benign, tends to be better than the 3 quarters. So the result of the 3 quarters should largely, largely be carried forward into the fourth quarter. Our guidance for achieving about a percentage improvement in each of the year stands. I would like to disagree on your statement that we are trying to move closer to 100%. There are two parts to our portfolio, domestic and foreign. We would certainly like to move below 100, particularly for foreign book, but that will not be a realistic target or a strategy for domestic business because the investment income on both the portfolios are fundamentally different.
So we will continue with our guidance of about 1% improvement on a composite portfolio rather than trying to achieve 100% for say, domestic or foreign. As regards obligatory combined ratio, that is a proportional book, we would say that it is faring decently, reasonably well on our non obligatory book. We also have facultative non proportional treaties. Proportional treaties and the book is fairly diverse. Given the diverse composition of non obligatory, which is, as I mentioned, proportional treaty, non proportional treaty, fact and miscellaneous kinds of covers is against obligatory. A straight comparison of the combined ratio across these two segments will not be fair.
Non obligatory is definitely most certainly supposed to fare better than the obligatory, given the composition. Coming to your third question regarding the obligatory how it will move, we can probably expect that given the geopolitical disturbances, stability may be targeted by the government. But this policy decision is in the realm of the regulator. And we present our views and industry players also present their views. Beyond that, it will not be correct on our part to speculate.
Janisha
Because I. Think that is one, one area where the clarity is little less. And I think it may not be. I’m saying when we are looking at the value, stock performances or basically the valuation that weighs a little more when it comes to the value unlocking for the company. So that will, I mean that is something where, when we speak a little. Bit. If a better clarity is available, that will help in maybe unlocking the value in the company.
Hitesh Joshi
Let me just expand on this. Probably we would have touched upon this in earlier calls and in our other meetings with the investing community. If obligatory goes away or gets reduced, it is not a straight loss of business. A substantial part, something like probably 25 to 50% will get readily converted into voluntary business, non obligatory business. So it is not a win or lose. If there is a nuance to how the business will develop, we will have more freedom in how we write capital. Our capital deployment will be free. And particularly those companies which are playing close to their Targeted solvency region, targeted solvency range.
They will definitely need a substitute reinsurance requirement immediately. Say a company which is running at a solvency of 1.65 and they would like to continue to be at 1.65. Any change in, I mean obligatory or a reinsurance arrangement will get replaced by another set of reinsurance arrangements. I hope it elevates your apprehensions to an extent.
Janisha
Yeah, yeah, yeah. Thank you for this clarity. And maybe the last question is on the growth. I mean you said you would be more calibrate in growing the book. Can you give some more color to it for the next year? And for FY28, how do you see the book growth likely to be? Because you focus more on quality. And as you alluded that 1% is a decrease in a combined ratio is a target which the company would like to follow. So what does it mean? How will it be balancing the growth and the profitability? If you can just give some understanding with that.
Thank you.
Hitesh Joshi
So the growth of the corporation would mostly at least mirror the growth of the Indian reinsurance market. Even the growth of the Indian insurance market, say in the range of something like 9 to 12% or higher, that is a nominal growth. Substantial part of this growth will also get mirrored in the reinsurance market. As far as Indian insurance market is concerned, given our broad strategic goal of maintaining our market share, we will be mirroring the growth of Indian reinsurance market coming to the international book. Given that now we got our rating back last year, October 24, previous financial year, whatever business was lost, it cannot be reclaimed or regained in a single year.
Because when we moved off the panel of certain insurance companies, say in Japan or Taiwan, we can’t just walk back at the same. On the same panel with the same share. So there is a clawback and it takes time. Maybe it can take something like three to five years. So to the extent GICD has had relationship with all the students in the.
operator
Ladies and gentlemen, sorry, the line of the management has been disconnected. Please allow me a moment while I reconnect the management. Thank you. .
operator
The line of the management has been reconnected. Thank you.
Hitesh Joshi
Hello.
operator
Yes sir, you can.
Hitesh Joshi
Yeah, apologies for the disruption. So as I was saying that whatever business we have lost thanks to the downgrade, that will be reclaimed over a period of something like three to five years. So that certainly presents opportunity for us to. To rebuild those relationships which were affected. And of course our medium term objective in terms of the composition of the risk book remains at 60, 40. So we will continue to focus on the interest rate book. And that should result into growth apart from the normal growth of the global reinsurance market, probably. To sum up, one can expect a growth rate in the medium term on an annual basis of something like 8 to 10% composite.
Janisha
Okay, understood. Thank you, sir.
Hitesh Joshi
Yeah.
operator
Thank you. Participants who wish to ask a question may press star and one on the touchstone telephone. The next question is from the line of Madhukar Ladha from JP Morgan. Please go ahead.
Madhukar Ladha
Hi, good morning. Congratulations on good numbers on the international book. I had a question. See, in some segments I see very high combined ratio like motor. Like, I think this time around the combined ratio is about 190%. Cargo is at about 282%. Life also is quite high at, you know, closer to 138 and health as well at about 143. So some of these segments we’re seeing very high combined issues. On the international side. What I want to understand is what is going to be our strategy in terms of, you know, improving the underwriting? Yeah, how can we change the product mix of here? Yeah, thanks.
Hitesh Joshi
So I agree with your observations and I think whatever three classes you have picked up, they are the points, they are the segments where we need to focus. We are mindful of that. I think we have addressed the explanation for the life higher combined ratio in the Q2. This cargo and motor both are definitely under management focus and we have already taken certain steps and we expect that those steps in terms of underwriting discipline will bear fruit going forward. I think if you compare this not on a quarterly basis, but on an annual basis, there is a distinct trend in terms of the improvement in performance for foreign book as well as for domestic book.
And I would like to say that for nine months, overall, foreign book has shown greater improvement in terms of performance. So management is absolutely focused on this segment that you have identified. Motor cargo and also life. We are working. It is a work in progress. Whatever we have done has bore fruit and we expect it to improve meaningfully going forward.
Madhukar Ladha
Just if I may ask, you know, where is this motor business coming from? Like the motor and cargo? Cargo may be a little bit of one off also, but especially, you know, which part of the world, what is this? And you know.
Sanjay Vasant Mokashi
Hello, this is Sanjay Mukashi. Hello, this is Sanjay Mukherjee, chief underwriting officer. Motor constitutes about 11% of our foreign book. And it comes from various regions. But I will name the peak regions will be Israel and Turkey. And the cargo business is also from these two region. In addition to that, it Comes from China. But I am only highlighting the major countries. Otherwise we write business worldwide. There are exposures in Europe as well. I hope that answers your question.
Madhukar Ladha
Sure. Thank you. And all the best.
Hitesh Joshi
Thank you.
operator
Thank you. Participants who wish to ask a question may press star and one on the touchstone telephone. The next question is from the line of Sanket Godha from Avendra Spark. Please go ahead.
Sanket Godha
Yes. Thank you for the opportunity, sir. Just wanted to understand the pricing environment. Maybe last year there was a kind of price benefit in the fire segment. But what we learned is that in small summer shows or midsummer shows the pricing competition has increased. And do you think even on the larger some assured fire capacities the pricing environment will hold up in the current what was during the current year will hold up in the next year or it will you see more competition. So just a color on the pricing and on similar lines on overseas business too.
If you can again give a color given January would have happened any any color you have on on how pricing environment is playing out. It is still still hard market or still still a soft market to assume that the combined issue in the foreign business will improve. But that’s my first question.
Sanjay Vasant Mokashi
Yes, Sanket, this is Sanjay Mukashi, Chief underwriting officer. Your observation on pricing environment in property segment especially in the small property segment is accurate that there is heavy competition among insurers there. And as a result it is putting pressures on the pricing on large risks. The impact on pricing is also seen because there is a competition wherever it is reinsurance driven. There is competition among reinsurers. But there are certain segment which are holding fairly well. For example refineries or energy energy segment where although the pricing is under pressure it is not as much as in other segment within the property.
As a reinsurer we are keeping a close watch on the pricing on the direct side. And we have handles in our reinsurance contract which will fairly protect us if the loss ratio is deteriorating steeply. On the overseas January 1st renewal it was soft. We had got some indication because we are part of some of the conversations before that happened before the renewal. And we were bracing for the softness of the market. But we observed that there is plenty of capacity plenty of capital in the in the market. And therefore there were heavy pressures on on the shares.
The we we wanted to write good shares but we could not. Eventually our shares got reduced. It is called signing long. So signing pressures were there on our our. Our business. But we could write some more business also which balanced the on the income side. So in a way our foreign book Became little more broad based than what it was before.
Sanket Godha
Understood. Basically the combined issue, what you reported say 121 percentage for nine months, which is definitely a better number compared to last year. If the market is soft, say next year, then it’s fair to say that to maintain 120 also will be an immediate target. Or you think that number can improve, deteriorate if the market is soft, we.
Sanjay Vasant Mokashi
Feel that this number will improve because our approach to risk selection, our approach to underwriting hasn’t changed even in this soft market cycle. We have been able to fairly maintain our position in terms of other terms and conditions on the contract wherever we were not chasing premium in this soft market cycle because it would not make sense. And our target as our executive Director Additional char CMD said that our target is to improve 1% point per annum on the combined ratio. Our property portfolio is almost 70% of our foreign book. And this is where our underwriting discipline should be more focused.
And that is what we are doing.
Sanket Godha
Understood, sir. Basically Hitesha, you said in the call that the rating benefit will play out in three, four years rather than on immediate basis. So if it plays out at a full potential, saying 3, 4 years, this 120 combined issue, you think it will improve to 110 or I’m not saying 100 but maybe 1 10, 105 kind of a number possible because you already saw a 10% delta improvement in the combined in international business in the current year. Another 10% is over 2, three years is possible.
Hitesh Joshi
See the rating and these, these are absolutely different things. When we are saying that we’ll regain our business and rebuild our earlier position in the market, it is with reference to the credit rating. The combined ratio performance is more about the overall pricing environment, terms and conditions environment and the development of climate related risk. The changes that have taken place since 2023 in terms of the share of risk borne by an insurance company and a reinsurance company. So when I said about rating, I was talking about our growth and our market share which we should be able to restore.
And we should also be able to access other markets based on our A rating. And the underwriting discipline is more on the operating performance side. So. So I would like to say that these are two separate things. And alongside the growth and restoration of the market share, improvement in performance can certainly go on. They can definitely, definitely run in parallel. There is no contradiction there.
Sanket Godha
The reason I asked this question is that rating upgrade probably gives you a potential to better contracts access which was not possible in the past so indirectly it improves the quality of the book and therefore the combined can improve. So I was coming from that perspective that naturally it will contribute to the growth, but the growth will come along with the improvement in the combined. Maybe, maybe credit rating gives you access to better quality contracts.
Hitesh Joshi
Yes, we expect that.
Sanket Godha
Okay, understood sir. And the second thing, sir, in the domestic business, one thing just I wanted to check was that your motor, I don’t know at all level motor has done well or even domestic business motor has. Overall motor has done well. So is it largely any growth of around 17 percentage in the motorist is generally very high or even compared to the underlying market of the domestic business, it seems to be in line or little better than the industry. So just wanted to understand what led to this thing. Are there specific risks which are getting reinsured or because of long term policies people want to reinsure and therefore.
Therefore that is driving your growth or you gain market share. So any color on that number will be useful. And second thing, your view on agri again because this number has been consistently coming off for us compared to what we were doing in the past. Even in the current year it’s just like a marginal growth year on year. And next year is a new tendering cycle. I don’t know whether the new formula will be based on AG 110 or I’m not sure on that part. Then how do you foresee the crop business playing out for you for next year in that sense?
Sanjay Vasant Mokashi
Sanket, on motor domestic the growth is a mix. The motor domestic almost 84% or 85% is obligatory. So the growth in the market on the direct side will get reflected in obligatory. But we also write motor reinsurance is more proportional where the income comes from. And it is a combination of this motor proportional as well as obligatory that has resulted in growth in motor business. And coming to your question on agriculture. Yes, we are waiting for the new tender cycle. We have been part of the committee that was constituted for getting inputs on the agriculture segment.
The exposure experience in the last year was different to the previous years. We are in touch with all the students and including Agriculture Insurance Co. Ltd. And we are ready to support the market in whichever form they require. We expect that cup and cap model in a different way will continue.
Sanket Godha
But. But most likely whether it will be panning the adoption of 8110 or a similar kind of a structure given then. Then it reduces the insurance opportunity to us. So. So I just wanted to understand whether. Whether. Whether Pan India it will go in that way or. Or you still Think there will be states available for. For reinsurance.
Sanjay Vasant Mokashi
It is going pan India is little unlikely because different states, states have different preferences and also some of the states have seen the benefits of burn cost method. So it is difficult to speculate at this stage. Let us wait for the outcome. We will write. We will avail the opportunities in best possible way and support the Indian market.
Hitesh Joshi
I will just add here that if at all you analyze the trend, probably there are quite a few players on 80, 110 already and now probably they are thinking of switching to 6130 probably the that phase where reinsurance was not required. It is done. There is a saturation and now there is a. Probably a U turn. There are, there are. There are other models which are being considered as I said 6130 or something else which will definitely increase more risk by the insurance companies and more reinsurance.
Sanket Godha
Understood. But in 6130 then probably will see more XL covers rather than proportional coverage which was a growth driver in the past.
Sanjay Vasant Mokashi
It will entirely depend Sanket on whether 6130 will be at burn cost or the traditional cup and cap. If it is, there will be demand for proportional treaties as well.
Sanket Godha
Understood sir. And lastly, lastly maybe to extend the first question which I asked. Maybe if domestic guys are coming and asking for the renewals in the commercial lines especially fire and engineering segment are you are still picking the burning cost as a benchmark for further reinsurance or the market is still soft for the higher ticket size? I’m assured.
Sanjay Vasant Mokashi
In the property segment. While answering earlier question I did mention that we will use the reinsurance handles that are available to us to ensure that we do that tightrope walking of protecting our balance sheet at the same time supporting the insurance companies. I’m afraid beyond that we cannot discuss our strategies in detail and we will, we will take. We will look at each contract based on its own merit.
Sanket Godha
Understood sir. Thanks. Thanks for your answers.
operator
Thank you. Participants who wish to ask a question may press star and one on the Touchstone telephone. The next question is from the line of Shobhat Sharma from HDFC Securities Ltd. Please go ahead.
Shobhat Sharma
Yeah. Hi sir. Thanks for the opportunity. I have two questions. Firstly is on the motor side of the business. So if you can give us some color around the how the loss issue on the motor side of business has been shaping up for you. And secondly on the OD side we have seen direct side insurance have witnessed an impact on the loss ratio and it is primarily because the netcat impact in the lower idv. So can you share your experience on that and how do you see that as a business opportunity for you? Because as one of the industry players who used to retain most of the risk on their net has also started seeding.
So this is my question on the motor side. Secondly, coming to the health business, we have seen, we have been de risking ourselves on the side of business all time because of that profitability it offers. So can you give us some color around the color of this book? Whether how much of this is obligatory in nature and how much of it is non obligatory and are we losing good business on the table on this side?
Sanjay Vasant Mokashi
Coming to motor business, as I mentioned while answering previous question, on the domestic side, a large portion of our business is obligatory and the market results will get mirrored in our obligatory results. But we also participate on many proportional and non proportional treaties and there our focus is to ensure that the book is profitable. And as a result on an for the domestic business, if you see, our incurred claim ratio hasn’t changed much as compared to previous year. But yes, on motor foreign we have encountered issues with the international business that we write mainly from Israel and Turkey, where some reserve strengthening has been happening.
And as a result the motor international business has seen negative results. But we have taken care of that. We are closely monitoring and on the 1st of January, while renewing the international motor business, we have ensured that we de risk the portfolio and realign our shares so that there is a turnaround in motor business result. Coming to your question, on health segment, almost 64% of the health business is obligatory and that will again mirror the results of the market. In addition to that, wherever there are opportunities in supporting insurance companies, health is not greatly reinsurance driven.
But there are many proportional treaties and there are many government schemes where the insurance companies require reinsurance support. But we extend our support only where it makes sense for us on the reinsurance basis and therefore on the non obligatory segment. In terms of business volume, there would be some volatility that we always witness. But we are okay with that because eventually our objective is to look at the combined ratio and ensure that our combined ratio is tolerable or it is improving.
Hitesh Joshi
I would just like to add here about the observation that you made, and I think it is a fairly good observation from your side that motor ode can emerge as a significant opportunity. I think it is one of the segments which will get affected by the climate change, more flood events, and it definitely presents an opportunity. So of course we have ample capacity. You know that we are in a very good position in terms of the solvency and we’ll be definitely exploiting this opportunity to the extent it develops.
Shobhat Sharma
Just a small follow up because we are now in the ongoing renewal renewal season with the Indian insured. So have you seen the OD renew ODE seeding coming into the discussions during the current renewal cycle?
Sanjay Vasant Mokashi
The discussions are happening as we speak, Shobhit. And usually the companies buy their reinsurance on a combined basis. Yes, the non proportional treaties, the catastrophic exposures are basically for OD segment. But yes, we are discussing and we will see how it pans out.
Shobhat Sharma
Okay, sir, these are. These are my questions. Thank you. And all the best.
Hitesh Joshi
Thank you.
operator
Thank you. Participants who wish to ask a question may press star and one on the touchstone telephone. The next question is from the line of K. Karthikyan, an individual investor. Please go ahead.
K.Karthikyan
Hi, thanks for the opportunity. I have a couple of questions. One is see with respect to the obligatory business. So what you are making answer to this? The first question. Right, the first questionnaire. You mean to say that when the obligatory percentage comes down it is better for the company? I mean it will free up capital and improve profitability. Is that understanding correct?
Hitesh Joshi
I think it will be a very simple evaluation if we say it is good or bad because obligatory gives us an opportunity in terms of a sizeable premium volume and the attendant float that we can get. So the benefit is in terms of the diversification and the investment income. At the same time we are not able to choose the risk. The good comes with the bad and it is a market performance. So we don’t have the freedom to write the way we would ideally would like to write. So there are pluses and minuses and overall we are of the opinion that it balances out.
So it is not say a very, say white or black. Because this is a proportional contract and we also have a sizable non proportional book and a facultative book. I’m not sure whether I have answered your question, but you can come up with a follow up question. I understand.
K.Karthikyan
So it gives us more freedom and all that. But so I’m just again say tomorrow it comes down to say. I mean it is currently 4%, it comes to 2%. So will that improve our business profile or what’s the outlook on that day? Comes down by 50% going forward.
Hitesh Joshi
As I said, part of the business lost will get replaced by the voluntary business. And it depends on where do we deploy our capacity and what is the dynamics of that. Suppose we transfer this capacity which is given to Obligatory, which is a proportional contract, to a Non proportional contract or international contract. So the different segments of the market present different levels of volatility and attendant return on equity. So it is essentially a job of an underwriter to match the return on equity with the volatility that we are writing. So if we are able to deploy this capital alternatively in say equally attractive or a more attractive segment of say international catastrophe, non proportional, we would be better off.
Okay, got it.
K.Karthikyan
I understand completely. Thank you. And the next question. See know in the past our CEO comment saying that now there is a lot of fraud and all that is happening in the insurance market. What kind of tools are we deploying to, you know, depict that and you know, mitigate those kind of problems?
Hitesh Joshi
See, I would like to say that this is at the heart of the industry and it is a perennial problem. The adverse selection and the moral hazard and whatever can be done can be essentially done only on the direct sector. Motor and health are two classes where there is a tremendous scope for deploying claims management practices. The AI and there are various tools and techniques. Just as we have our tools and techniques as a reinsurer there are so many claims management techniques which are differently adopted by different players in the market. But as a reinsurer we are.
Our support is essentially at say portfolio level. Our say 90% plus premium is and exposures are coming from prop and non prop treaties. So fraud is essentially a domain of the insurance companies. Unless you highlight something specific we can probably discuss on the call or offline. But I believe it is the domain of the insurance companies.
K.Karthikyan
Okay sir. Yes, specifically I probably. I can send an email please.
Hitesh Joshi
Yes please.
K.Karthikyan
Yeah. And health, right? I mean even though market is growing for this year, I mean the nine months there’s more than. I mean 15% growth, right. For the primary company. But whereas we have degrown any specific reason for that.
Sanjay Vasant Mokashi
Health, the non obligatory portion is quite volatile as in terms of volumes. If we don’t renew a particular contract which has significant volumes, we end up degrowing. Our focus will always be on the contract that will make sense to us and we may win some, we may lose some. But yes, it is the dynamics that will play out and manifest into de growth or growth.
Hitesh Joshi
I would like to just add here that it is not necessarily that when.
operator
Ladies and gentlemen, the line of the management has been disconnected. Please stay connected while we reconnect the management. Thank you. SA. Ladies and gentlemen, thank you for your patience. The line of the management has been reconnected. Over to you sir.
Hitesh Joshi
Apologies again for the disconnection. As I was mentioning that it is not necessarily that when we say when we lose a particular segment of premium, it is that somebody else has walked away. See this health side, the insurance companies may also restructure their entire reinsurance purchase. So it is quite possible that on a large contract, particular insurance company decides to buy differently or not buy at all. And in that case, if that particular purchase is replaced by self retention, we might have volatility. As our CEO pointed out that this is a fairly volatile segment. So that it is not necessarily that we are losing market share or we are losing business.
It can also be that insurance companies are retaining more. Thank you.
K.Karthikyan
Okay sir, got it. I mean all my questions have been answered. Thank you. And all the best.
Hitesh Joshi
Thank you. Thank you.
operator
Thank you. Participants who wish to ask a question may press star and one on the Touchstone telephone. The next question is from the line of Ritika Dua from Bandhan. Please go ahead.
Ritika Dua
So thank you for the opportunity and congrats on a set of results. So just one question left on this cat reserve we have mentioned in the notes to accounts. Where are we today on an outstanding basis?
Hitesh Joshi
The question is not clear what is outstanding basis.
Ritika Dua
So as in, we said that in the notes to account that we are going to continue to create this reserve till the time we create a particular kitty. So what is the outstanding reserve that we have already created?
Hitesh Joshi
It is about 2000 crore and it is supposed to be a strategic kind of say kitty that we are building. So that it is not that say, suppose it is crossing, say 3,000 will start withdrawing. It is a kind of long term strengthening of the balance sheet and our capital position in a way. So we will continue to build and will not withdraw unless there is a say major catastrophe which puts stress. So we have internally kind of a policy for this creation and utilization of the reserve and we will be continuously recalibrating that. Because any withdrawal from cat reserve is also a substitute from the say reinsurance purchase and all that.
So there is a trade off involved. So on a dynamically basis we will be evaluating this and we will be undertaking a major review when we touch something like 5000 crores. So it is a long journey. I hope it helps.
Ritika Dua
No sir, it helps a lot. So just one. Sorry, I. I missed one point when you were mentioning what, how, how does the utilization of this work? Like.
Hitesh Joshi
We will see if say there is a major jolt to our PNL major catastrophe in line with the. This particular catastrophe reserve policy. With the, with the approval from the board, we can utilize the funds in the cat reserve. That is how we are planning. Sure.
Ritika Dua
So that’s. That’s very helpful. Thank you so much. I’m done.
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Thank you. Participants who wish to ask a question may press star and one on the touchstone telephone. As there are no further questions from the participants, I now hand the conference over to the management for the closing comments.
Hitesh Joshi
Thank you. As we have been advising the investing community over all these quarter earnings calls, that market is becoming more nuanced. It is becoming more sophisticated. It is evolving. As I also mentioned in my introductory remarks that though this market is getting characterized as a soft market, every soft cycle phase is also different. Though there are similarities, there are also differences. There is, there is more nuanced approach in terms of assessing a particular students operating performance on the back of discipline, underwriting, consistent execution and our strategic strategy strategic approach. We hope and believe that we’ll continue to achieve the guidance we are giving and continue to perform to the satisfaction of our stakeholders.
Thank you. Good morning and all the best.
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Thank you, sir. On behalf of General Insurance Corporation of India, that concludes this conference. Thank you for joining us. You may now disconnect your lines.