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“We are also considering a selective hike in tariffs this year, with a filing to the regulator. Although not finalised, it will likely be in the single digits,” the official added.
Public sector general insurer National Insurance Company Ltd (NIC) is aiming at a return to profit in the current 2024-25 fiscal, after incurring losses for nearly a decade, an official said on Saturday.
The company is expecting Rs 100-200 crore profit this year, NIC Executive Director T Babu Paul said.
The Kolkata-based insurer noted that a single-digit revision in policy tariffs is expected as medical treatment costs have increased, he said.
“We were able to narrow down the loss to Rs 187 crore in FY’24 (2023-24) from a whopping Rs 3,865 crore loss in the previous year. We expect to post a net profit of Rs 100-200 crore, provided no catastrophe hits us in the remaining quarters,” Paul said on the sidelines of the 6th edition of the Insurance Leader Meet & Excellence Awards organised by Assocham.
He mentioned that the company’s ability to reduce loss-making insurance products and implement other cost-saving measures has set the public sector insurer on a path to turnaround.
“We have either pruned or re-priced motor insurance and group or bulk health products. Now, we are focusing more on retail ones,” Paul added.
In the health sector, retail accounts for about one-third of the total Rs 7,000 crore premium, while in motor insurance, it accounts for nearly two-thirds of the Rs 5,000 crore premium from the segment.
“Health and motor account for 80 per cent of our portfolio, but in the next three years, we aim to reduce this dependence to 70 per cent by improving other miscellaneous insurance products like fire, home,” Paul said.
Speaking about the revision of health policy tariffs, he noted that medical treatment costs have increased by 5-20 per cent, and to bridge the cost gap, an industry-wide tariff revision is expected this year.
“Our average claim amount has jumped to Rs 41,000 from Rs 27,000 in 4-5 years ago,” he said.
“We are also considering a selective hike in tariffs this year, with a filing to the regulator. Although not finalised, it will likely be in the single digits,” the official added.
General Insurance Council Secretary General Inderjeet Singh said both the government and the insurance industry are working towards achieving ‘Insurance for All by 2047’.
Meanwhile, Assocham and PwC released a report on the Future of Indian Insurance on the occasion.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
First Published: Aug 17 2024 | 7:20 PM IST
