ICICI Lombard posts 20% increase in Q2 profit driven by motor, health insurance segments

ICICI Lombard General Insurance has announced a robust 20 per cent rise in its profit for the second quarter, attributed to a surge in premiums from its motor and health insurance sectors. The company's profit after tax reached Rs 694 crore rupees for the quarter ending September 30, compared to Rs 577 crore in the same period last year.

The growth can be linked to a strong performance in the renewal of policies for older vehicles, alongside a notable increase in motorcycle sales, which helped mitigate the impact of declining car sales. This marks a significant shift, as Indian carmakers experienced their first sales decline in ten quarters during the July-September period, according to industry data.

Motor insurance, which constitutes nearly half of ICICI Lombard's total premiums, grew by 14.4 per cent in the quarter. Additionally, the corporate health insurance segment, the company’s fastest-growing area, saw premiums rise by 22 per cent, driven by new product launches and increased awareness of insurance options in the wake of the pandemic.

ICICI Lombard, supported by ICICI Bank , also provides marine and crop insurance, among other offerings. The company reported a 16.7 per cent increase in net premiums earned, amounting to Rs 5,026 crore. However, claims paid rose approximately 31 per cent during the same period.

Investment income also saw a boost, climbing about 14 per cent to Rs 846 crore, as equity markets reached record highs in the September quarter. Despite these positive indicators, the company’s combined ratio—a critical metric for assessing underwriting profitability—rose to 104.5 per cent, up from 103.9 per cent a year ago. This increase is attributed to significant "catastrophic" losses, although the company did not provide further specifics.

Ahead of the results, ICICI Lombard's shares fell by 1 per cent, but the stock has appreciated nearly 42 per cent this year, reflecting strong investor confidence in the company’s performance.