Government-owned general insurer National Insurance Company (NIC) is aiming to return to profit in the current fiscal year ending 31 March 2025 (FY2025), after incurring losses for nearly a decade, one of the company's directors said.
The Kolkata-headquartered company is expecting INR1bn ($11.9m) to INR2bn this year, reported Press Trust of India quoting NIC executive director Mr T Babu Paul.
He said that the insurer was able to narrow its loss to INR1.87bn in FY2024 from INR38.55bn the previous financial year. He added, “We expect to post a net profit of INR100-200 crore, provided no catastrophe hits us in the remaining quarters."
Health and motor insurance
Mr Paul said that NIC had reduced loss-making insurance products and implemented other cost-saving measures in a bid to turn around its financial performance.
"We have either pruned or re-priced motor insurance and group or bulk health products. Now, we are focusing more on retail ones," he added.
Retail business accounts for about one-third of the total INR70bn premium in the company’s health insurance segment, while it accounts for nearly two-thirds of the INR50bn premium from the motor segment.
"Health and motor account for 80% of our portfolio, but in the next three years, we aim to reduce this dependence to 70% by improving other miscellaneous insurance products like fire, home," Mr Paul said.
The government has directed state-controlled general insurers, which are struggling to improve their solvency ratio and profits, to exit the motor and health insurance segments, which have been identified as significant loss-making branches.
Three major public-sector insurers – NIC, United India Insurance Company (UIIC), and Oriental Insurance Company (OICL) – have received a combined capital infusion of around INR175bn in recent years from the state. The government injected INR25bn in the three companies in the financial year ended 31 March 2020 (FY2020), INR99.5bn in FY2021, and INR50bn in 2022.