New India Assurance posts Rs 1,267.04 crore Q2 loss on claims

The New India Assurance Company Limited, referred to here as New India Assurance, reported a Rs 1,267.04 crore loss after tax for the quarter ended September 30, 2026, against a Rs 63.25 crore profit a year earlier. Incurred claims rose to Rs 12,879.50 crore, driving the combined ratio to 156.20% from 139.77%.

Why did New India Assurance report a Rs 1,267.04 crore quarterly loss?

New India Assurance recorded a Rs 1,267.04 crore loss after tax in the September 2026 quarter, compared with a Rs 63.25 crore profit after tax in the September 2025 quarter. The result also widened from a Rs 256.77 crore loss in the quarter ended June 30, 2026, while earnings per share moved to a loss of Rs 7.69 from profit of Rs 0.38 a year earlier.

The immediate pressure came from an underwriting loss of Rs 5,237.35 crore, compared with an underwriting loss of Rs 3,554.36 crore in the year-earlier quarter. Total expenses increased to Rs 14,869.53 crore from Rs 12,953.27 crore, whereas premium earned rose to Rs 9,632.18 crore from Rs 9,398.91 crore. This left the underwriting deficit wider before investment income was included.

Net income from investments was Rs 2,907.21 crore in the September quarter, marginally below Rs 2,914.08 crore a year earlier. Total income nevertheless rose to Rs 12,539.39 crore from Rs 12,312.99 crore, but remained below total expenses of Rs 14,869.53 crore. New India Assurance consequently reported an operating loss of Rs 2,330.14 crore, against an operating loss of Rs 640.28 crore a year earlier.

How did claims increase New India Assurance's combined ratio?

New India Assurance reported an incurred claim ratio of 133.71% for the September 2026 quarter, up from 108.66% a year earlier and 103.38% in the June 2026 quarter. Its combined ratio reached 156.20%, compared with 139.77% in September 2025 and 121.44% in June 2026. The expense of management ratio was 19.95%, below 27.89% a year earlier but above 16.80% sequentially.

Incurred claims increased by Rs 2,667.07 crore year on year to Rs 12,879.50 crore. Claims paid rose to Rs 9,478.83 crore from Rs 8,750.32 crore, while the change in outstanding claims, including incurred but not reported and incurred but not enough reported claims, rose to Rs 3,400.67 crore from Rs 1,462.11 crore. The increased outstanding-claims movement accounted for a substantial part of the increase in incurred claims.

Net commission increased to Rs 946.69 crore from Rs 913.45 crore, while operating expenses related to insurance business rose to Rs 1,043.34 crore from Rs 1,027.39 crore. These increases were smaller than the Rs 2,667.07 crore rise in incurred claims. The filing defines the expense of management ratio as expense of management plus direct commission divided by gross direct premium.

Did premium growth offset New India Assurance's claims increase?

No. New India Assurance's gross premiums written rose to Rs 11,083.43 crore in the September 2026 quarter from Rs 10,541.17 crore a year earlier. Net premiums written rose more modestly, to Rs 8,850.42 crore from Rs 8,807.97 crore, and premium earned increased by Rs 233.27 crore to Rs 9,632.18 crore. That increase was well below the Rs 2,667.07 crore rise in incurred claims.

The net retention ratio declined to 79.85% from 83.56% in the year-earlier quarter and 81.84% in June 2026. The filing states that net premium is after reinsurance, including excess-of-loss reinsurance. The lower ratio coincided with gross premiums rising faster than net premiums written during the quarter.

For the half year ended September 30, 2026, gross premiums written were Rs 24,803.90 crore, compared with Rs 23,874.75 crore in the comparable prior-year half year. Premium earned rose to Rs 19,315.05 crore from Rs 18,768.33 crore, while incurred claims climbed to Rs 22,889.56 crore from Rs 19,559.44 crore. The half-year loss after tax was Rs 5,238.81 crore, compared with a Rs 454.26 crore profit a year earlier.

Which New India Assurance segments recorded the largest underwriting losses?

New India Assurance's motor segment recorded the largest September-quarter underwriting loss among the disclosed lines, at Rs 1,953.38 crore, compared with Rs 1,068.81 crore a year earlier. Health, including personal accident, followed with a Rs 1,752.92 crore loss, compared with a Rs 1,382.18 crore loss. Fire reported a Rs 1,612.93 crore underwriting loss, against a Rs 905.85 crore loss a year earlier.

Aviation moved to an underwriting loss of Rs 790.77 crore from an Rs 87.21 crore profit in the September 2025 quarter. Marine recorded a Rs 54.09 crore loss and engineering a Rs 67.94 crore loss, while liability moved to a Rs 39.84 crore loss from an Rs 212.90 crore profit. The segment statement also showed an Rs 64.96 crore underwriting loss in other miscellaneous business.

Motor carried technical liabilities of Rs 36,983.16 crore as at September 30, 2026, up from Rs 33,185.01 crore a year earlier. Health technical liabilities were Rs 11,593.72 crore, versus Rs 11,055.21 crore, and fire technical liabilities rose to Rs 8,073.76 crore from Rs 7,071.78 crore. These figures are reported separately from the quarter's segment underwriting results.

What did New India Assurance's auditors and financial ratios show?

New India Assurance reported a solvency ratio of 1.61 as at September 30, 2026, compared with 1.79 a year earlier and 1.80 at June 30, 2026. Shareholders' fund investments were Rs 24,123.27 crore, up from Rs 23,716.29 crore a year earlier, while policyholders' fund investments increased to Rs 61,729.62 crore from Rs 58,978.96 crore.

The independent auditors issued a qualified conclusion because certain balances were at different stages of reconciliation, compilation and confirmation, with related adjustments yet to be recorded. The auditors said the overall effect could not be ascertained pending that work. Their review covered eight domestic regional offices, large corporate business offices or other offices, while results from specified foreign branches and agency offices were considered through other auditors' reports or management certification.

The auditors also drew attention to Rs 10,614.72 crore of contingent tax liabilities relating to income tax, goods and services tax and service tax demands that were sub judice, where the Company cited favourable judgments. They noted a Rs 61.29 crore deferred-tax expense following the Company's irrevocable election of the new tax regime. These emphasis matters did not modify the auditors' conclusion beyond the qualification on unreconciled balances.

Conclusion

New India Assurance's September 2026 result reflects claims growth that exceeded the increase in premium earned. Gross premiums written rose by Rs 542.26 crore year on year, but incurred claims rose by Rs 2,667.07 crore, increasing the incurred claim ratio to 133.71% and producing a Rs 1,267.04 crore loss after tax despite Rs 2,907.21 crore of net investment income.

The key disclosed matters to watch are the pending reconciliation, compilation and confirmation of balances identified in the qualified conclusion, and the Company's work to strengthen internal controls and internal audit over software data input and validation. The filing also leaves unresolved the eventual outcome of Rs 10,614.72 crore in contingent tax demands before appellate authorities and the Bombay High Court.