GIC Re back in black with Rs 690 crore net income on lower underwriting losses

The only domestic reinsurer GIC Re on Wednesday reported a net income of Rs 689.72 crore in the April-June quarter of FY23 as against a net loss of Rs 771.73 crore a year ago.

The return to profitability is due to lower underwriting loss which came down to less than a third at Rs 776.29 crore for the quarter from Rs 2,811.17 crore in the year-ago quarter, the state-owned reinsurer said in a statement.

Gross premium income slipped to Rs 11,021.83 crore from Rs 14,289.92 crore a year ago, while investment income inched up to Rs 1,890.43 crore from Rs 1,794.60 crore, buoying the bottom line.

The combined ratio -- a key profitability metric-- improved to 110.97 from 123.36 a year ago and the solvency ratio stood at 2.14 compared to 1.74 from year-ago period.

Total assets of the company increased to Rs 1,46,178.09 crore from Rs 1,42,454.14 crore and net worth (without fair value change account) rose to Rs 24,744.87 crore as against Rs 21,285.37 crore. Net worth, including fair value change account, rose to Rs 53,741.39 crore from Rs 50,673.76 crore.

While gross premium income declined to Rs 11,021.83 crore from Rs 14,289.92 crore, net premium income also slipped to Rs 10,493.68 crore from Rs 12,935.22 crore. Earned premium income also declined to Rs 10,736.16 crore from Rs 11,354.41 crore.

On the claims front, the incurred claims declined to Rs 10,168.91 crore in the reporting quarter from Rs 11,837.40 crore a year ago.

The company's net commission declined to Rs 1,655.56 crore from Rs 2,409.29 crore, again boosting the bottom line, while other expenses stood at Rs 49.80 crore, down from Rs 62.40 crore.

Domestic gross premium constituted 75 per cent of its income at Rs 8,247.77 crore, but fell 21 per cent from Rs 10,435.60 crore a year ago, while international gross premium declined by 28 per cent to Rs 2,774.06 crore from Rs 3,854.33 crore. In the year-ago period the share was 73 and 27 per cent respectively.