New India Assurance Company Ltd (NSE: NIACL) Q4 2025 Earnings Call dated May. 21, 2025
Corporate Participants:
Girija Subramanian — Chairman and Managing Director
K V Raman — General Manager & Chief Risk Officer
Presentation:
Operator
Ladies and gentlemen, you have been connected to the new India Assurance Company Limited Conference Call. The call will begin shortly. Please stay connected. Please note that you have been connected to the New India Assurance Company Limited Conference Call. The call will is begin shortly.Please stay connected welcome Welcome to the conference call of the New India Assurance Company Limited arranged by Concept Investor Relations to discuss its Q4 FY ’25 results. We have with us today Mrs Subramanian, Chairman Managing Director; Mrs Kasturi Gupta, Executive Director; Shree Vimal Kumar Jain, Chief Financial Officer, among other esteemed management members.
At this moment, all participant lines are in listen-only mode. Later, we will conduct a question-and-answer session. At that time, if you have a question, please press star and one on your Touchstone phone. Please note that this conference is being recorded. I would now like to hand the conference over to Mrs Subramanian, Chairman, Managing Director. Thank you, and over to you, ma’am.
Girija Subramanian — Chairman and Managing Director
Good evening, everyone. I’m Subramanian, Chairman, Managing Director of the New India Assurance Company Limited. It’s my privilege to welcome you to this investor call following the announcement of our performance review for the 4th-quarter of FY ’25. Joining me today are Mrs Kasturi Sein Gupta, Executive Director; Shri Vimal Kumar Jain, Chief Financial Officer; Mr K.V. Raman, General Manager of Finance; Mr Sharat, our appointed Actuary; and many other general managers.
At this outset, I would like to extend my heartfelt gratitude to all the participants for taking the time to join us this evening. I also wish to thank our shareholders, investors and analysts for your continued trust in our organization. Your unwavering support continues to be a key driver to our success, motivating us to deliver consistent and sustainable growth.
I would quickly give a brief background of our company and then proceed to the financial and operational aspects for the fiscal year 2025, post which we shall proceed to the question-and-answer session. Me and my team shall do our best to answer all your queries and clarify all your doubts. As you know, we are a 106-year-old insurance company conceptualized by Sir G Tata in 1990 and nationalized in the year 1973. We are a PSU under the Ministry of Finance, Government of India.
We have a pan-India presence with 1,660 plus offices in 25 countries. And with so many geopolitical risks and rising uncertainties hovering around insurance both life and non-life have become the need of VR. And we firmly believe your company, the New India Insurance Company Limited, is best placed to cater the growing needs Needs of the non-life insurance. Also, the young generation has an awareness, willingness and discretionary income to opt for non-life insurance to safeguard themselves against any adversities. This has been largely possible with the awareness initiatives of the IRDAI and the Government of India. Let me assure you that we have a robust cybersecurity infrastructure in-place, which is evident in the fact that we have been certified ISO 2001 2022 for IT security, which ensures our emphasis on customer data protection and technological capability. The general insurance industry stands at INR33,649.27 crores as of April 25, which grew at a rate of 13.38% year-on-year as per General Insurance Council’s data, of which your company has underwritten INR6,026.63 crores, which is an 18% of the total gross direct premium underwritten, which grew by 14% year-on-year. Business highlights, the distribution mix stands at a direct 28.55% from the direct sources agency 28.56%, bancassurance, 0.64%, dealer, 8.73%, brokers, 33.52%. Product mix stands as follows: Health and PA 46%; Motor TP 15%, motor OD 13%, 2%, fire 14%, crop 1%, others 9%. In-quarter one FY ’26, ratings agency CRISIL has reaffirmed its CRISILA stable rating, which is considered to have the highest degree of safety for your company. Furthermore, AM has assigned the India National Scale rating of AAA.IN exceptional and has confirmed the financial strength rating of B-plus good and long-term issuer credit rating of BBB-plus good to New India Assurance Company Limited. The outlook of these credit ratings is stable. Your company has invested in equity shares of the Bima Sugam India Federation, a Section 8 company through private placement for a cash consideration amounting to INR5 crores. Bima Sugam will act as a one-stop solution e-platform for people to access all products of all insurance companies. It will be a digital platform to be regulated by the IRDAI where the customers can buy insurance policies and get their claims settled and will also be useful for all the stakeholders like insurers, agents, depositories, etc. At New India Assurance Company Limited, we have always endeavored to preserve an equilibrium between growth and profitability without which an organization cannot survive. We constantly strive to make sure that every underwritten policy is risk-weighted and contributes to enhance shareholder value. In-line with this, we have consciously foregone corporate accounts, which were not revenue accretive. However, this has been compensated with quality underwritten policies, which have minimal risk. All-of-the-above conscious efforts are evident in our financials for FY ’25, ’25, which are as follows: financial performance summary for ’25 — FY ’25. The gross direct premium income Indian business stood at INR38,660 crores in FY ’25 as compared to INR36,997 crores in FY ’24. The gross written premium global stands at INR43,618 crores in FY ’25 as compared to INR41,996 crores in FY ’24. Net premiums earned global reported at INR35,368 crores in FY ’25 as compared to INR34,028 crores in FY ’24. Net-worth stands at INR21,538 crores in FY ’25 as compared to INR20,827 crores in FY ’24. Net profit-after-tax stands at INR988 crores in FY ’25 as compared to INR1,129 crores in FY ’24. Now coming to the important ratios for FY ’25, the — which are as follows. Net incurred claim ratio is at 96.61%, commission ratio and 9.95% of net written premium compared to 8.74% in FY ’24. Expense ratio 10.21% of net written premium compared to 13.78% in FY ’24. Combined ratio 116.78% compared to 119.88% in FY ’24. Solvency ratio 1.991% compared to 1.81% in FY ’24. The return-on-equity ratio is at 4.66%. Digital and IT transformation. Our digital initiatives have started yielding significant results. A growing number of customers are now opting for digital channels to purchase policies and settle claims. The substantial volumes of claims have been processed digitally and this segment is expected to continue its upward momentum. Several transformative IT initiatives have been executed. These include a complete revamp of our website with an enhanced UI UX and the introduction of an NLP-enabled chatbox in eight languages. We have also launched WhatsApp services offering features such as policy download, claim status tracking, product information and live chat against available in eight — again available in eight languages. Our 24×7 multilingual call-center now supports end-to-end services related to product queries, policy issuance and claims. Our customer portal enables a seamless digital journey for buying standard insurance products and managing policies and claims online. We have implemented AI-based claim automation for motor owned damage claims up to INR1 lakh and introduced HSN code-based digital survey mechanisms to facilitate real-time claim processing. Advanced analytics tools like Oracle analytics are being used for actuarial pricing. Additionally, an AI-powered fraud-based and abuse tool is deployed for fraud detection in specialized health operations. We have aligned ourselves with several national initiatives. Our integration with the account aggregator ecosystem is live. We are also integrated with the.
Operator
Ladies and gentlemen, the line for the management has been disconnected. Kindly stay connected while we try to reconnect them ladies and gentlemen, thank you for patiently holding. The line for the management has been reconnected. Thank you, and over to you, ma’am.
Girija Subramanian — Chairman and Managing Director
Yes. We have realigned ourselves with several national initiatives. Our integration with our account aggregator ecosystem is live. We are also integrated with the Jan portal for PM now connected with seven partner banks. Furthermore, claims are being processed through the NHCX platform across multiple hospitals. On the developmental front, we are progressing towards onboarding with the open network for Digital Commerce ONDC in the health line-of-business and the implementation of IFRS 17 and in AS 117 is already underway.
We are also collaborating with fintechs and startups for process enhancement, implementing IT service management and AI-based knowledge systems and expanding our digital marketing efforts through SEO and social media. With this, I come to the conclusion of my opening remarks and invite our General Manager of Finance, Mr K.V. Raman to provide a detailed overview of our financial performance.
K V Raman — General Manager & Chief Risk Officer
Yeah, good evening, everybody. I am pleased to present the financial performance of this company for the year ending 31325, the gross written premium of the company is INR43,618 crore as against INR41,996 crores of the previous year. And this gives an year-on-year change of 4% — 3.86% for the current year, which is in alignment With the reduced market growth of the industry. And the net written premium after the reinsurance arrangement after the premium is seeded out, the net written premium is INR36,315 crore as against INR34,407 crores, which works out to roughly 83% of the gross written premium. And the net earned premium as calculated as per the prevailing regulation, it is INR35,368 crore as against INR34,028 crores of the previous year, which was up to around 82% of the gross written premium. And the net to incurred client stands at INR34,168 crores as against 33,128. But in terms of percentage of ICR on the net earned premium, it works out to 96.61%, which is less compared to 97.36% of the previous year. And the commission outgo works out to INR3,615 crores as against INR3,008 crores and the increase is due to the reward and remuneration given to intermediaries where the incurred claim ratio is better this year. And on operating expenses, it is INR3,709 crore as against INR4,742 crore, making a significant reduction. And in terms of percentage, it is 10.21% for the year ’24 ’25 compared to 13.78% of the previous year, making significant improvement. So the combined ratio works out to 116.78% for the recent year as against 119.88% of the previous year, making a difference of improvement of 3.1%. The underwriting results are the last INR61,124 crores, which gives an improvement of 11% as against the previous year loss of INR6,850 crores. And the investment income accept to INR8,034 crore for the year ending compared to INR9,241 crores, which is basically due to the investment market behavior. And the split-up of interest and dividend income is INR5,214 crore as against INR4,872 crore of previous year where the company has done well in the interest and dividend income and the capital gains are INR2,820 crore as against INR4,369 crore, which is due to the difference in fair-value change. So it is evident that the investment income is less due to the market in-market behavior. And the other income and expenses are INR875 crore as against INR946 crore of previous year, which mainly includes the provisions made during the current year towards non-moving balances. And the profit before-tax, it is INR1,034 crore as against INR1,445 crore and the tax component is as per the rules, it is INR46 crore as against INR316 crore of previous year. This is less because of the provision and advanced tax already paid and the profit-after-tax is INR988 crore as against INR1,129 crore of previous year. We have also uploaded the figures of the latest quarter, the comparative figures of latest quarter and the previous year last quarter. And the income — other income includes the — as I already mentioned, it includes the legacy non-moving balance provision which has been made as per the Board approved policies salary. This — there is also a comparative chart of combined ratio, gross written premium and investment income and profit-after-tax of the latest quarter compared to previous year quarter and the ’24 25 year compared to previous year, which has been uploaded also in our website. And the solvency ratio of the company as on 31325 stands at a sound 1.91% compared to 1.81% of previous year. Year and the net-worth stands at INR21,538 crore compared to INR20,827 crore, which shows an improvement. And the fair-value change account stands at INR21,400 compared to INR23,569 crores, which is due to the loss in capital gains only. And the technical reserve of the company stands at INR53,177 crores compared to INR50,114 crore of the previous year and the return-on-equity stands at 4.66% as against 5.58%, but ignoring the provisions made, it would be much better than 5.58%. Segment-wise performance on fire department, the premium done is INR6,225 crore compared to INR6,744 crores and the ICR is 71.2% compared to 80.1% of the previous year, which shows that the — the LOB is going-in the right direction. And the marine premium INR1,010 crore as against INR1,032 crores. Here the ICR is very decent, 53.7% compared to 48.1% of the previous year. And in motor, it is INR5,406 crore as against INR5,152 crore with a growth of 5%, 4.9% exactly. And the ICR stands at 104.2 compared to INR105.8 of previous year. And in water TP, it is INR6,652 crores compared to INR5,993 crore of previous year and the year-on-year growth is 11% here and the ICR is 108.2% as against 96.4%, which is actually indicating that the department — this particular portfolio is due for revision and premium and we are awaiting instructions from the government and regulator. And health and PA, it is INR19,928 crore compared to INR19,024 crore of previous year with a growth percentage of 4.7%, which is in tune with the company’s growth rate because our health portfolio is around 46% of the company and the ICR has improved to 100.9% compared to 105.9% of the previous year, having a significant improvement of 5%. And the crop is INR483 crore as against INR313 crore of previous year and the ICR is 81% as against 37.6%. And for all other business put together, it is INR3,914 crore compared to INR3,737 crore of previous year with a growth rate of 4.747%, which is also in-line with the company’s growth rate and the ICR of all other business put together it is 58.8% compared to 59.7% of previous year. Overall business already as mentioned, it is INR43,618 crore with a growth of 4% with an ICR of 96.6% as against the previous year performance of 97.36% ICR. If [Ends Abruptly]