Public sector general insurer United India Insurance Company (UIIC) has reported a profit after tax of Rs. 1,003 crore for the year 2017-18, compared with a loss of Rs. 1,914 crore in the previous fiscal, thanks to significantly lower underwriting losses.
In 2017-18, the underwriting losses fell by almost half to Rs. 2,542 crore from Rs. 4,444 crore in 2016-17.
In FY17, the company had to make a huge technical provision at one go, and hence, the underwriting losses were huge, which led to the company reporting a net loss of Rs. 1,914 crore. In 2017-18, net incurred claims were lower at Rs. 12,138 crore (Rs. 12,881 crore in FY17), while expenses dropped to Rs. 2,598 crore (Rs. 2,969 crore). Combined ratio (a measure of insurer profitability) of UIIC stood at 119.77 per cent against 136.94 per cent in 2016-17. Its investment income zoomed to Rs. 3,770 crore from Rs. 2,532 crore.
The second-largest general insurer in the country managed to take the solvency ratio to 1.54 per cent (1.5 per cent is stipulated by the regulator) during FY18 against 1.15 per cent as of March 31, 2017.
“This was achieved by measures such as underwriting control, focus on better-priced products and raise of subordinated debt of about Rs. 900 crore,” said MN Sarma, Chairman-cum-Managing Director, UIIC.
Its gross premium income grew by 9 per cent at Rs. 17,430 crore (Rs. 16,063 crore), while net premium income stood at Rs. 12, 861, up from Rs. 12,032 crore.
