The New India Assurance FY26: Premium growth holds up as underwriting absorbs wage revision and higher claims

The New India Assurance Company Limited closed FY26 with steady premium growth and a sharp improvement in reported profit, even as underwriting metrics reflected the combined impact of elevated claims in a few lines and a large, quantified wage and pension revision.

For FY26, the insurer reported gross written premium of 47,174 crore, up from 43,618 crore in FY25. Profit after tax increased to 1,384 crore versus 988 crore a year ago. Q4 FY26 profit after tax rose to 558 crore from 347 crore in Q4 FY25. Management attributed the year’s resilience to a diversified portfolio and multi-channel distribution, while also acknowledging that the incurred claim ratio and combined ratio were adversely impacted by specific loss events and employee-related provisioning.

Underwriting pressure: claims and wages pushed the combined ratio higher

The underwriting picture in FY26 remained challenging. Net incurred claims for FY26 were 37,942 crore on net earned premium of 38,462 crore, translating to an incurred claim ratio of 98.65% compared to 96.61% in FY25. Commission ratio improved modestly, but operating expenses rose sharply, with management citing wage revision and a change in family pension as the primary drivers.

The combined ratio for FY26 was reported at 122.57% versus 116.78% in FY25. Management quantified the wage revision and family pension impact at 3,525 crore for the year and stated that 597 crore related to the family pension revision from 15% to 30% was absorbed in Q4. The company also disclosed that underwriting results were impacted by provisions toward wage arrears and retirement benefits of active employees of 436 crore in Q4 and 2,314 crore for FY26, while other income and expenses were impacted by 569 crore in Q4 and 1,211 crore for FY26 related to retired employees.

Management and the finance team also provided an adjusted view: the combined ratio for FY26, adjusted for wage revision-related impact, was stated as 116.67% compared with 115.34% in the previous year.

Segment mix: Health leads premium, Motor remains the pain point

The company’s premium mix remains heavily tilted toward Health and Personal Accident. In FY26, Health and PA contributed 22,444 crore of gross written premium, representing 47.57% of the total. Fire at 6,895 crore (14.62%) and a combined Motor portfolio of 12,175 crore (25.81%) were the next largest contributors.

A key positive in FY26 was Health loss experience. The Health and PA incurred claim ratio improved to 99.05% in FY26 from 100.98% in FY25. Management attributed the improvement to stronger monitoring of claims, higher TPA audit coverage, and closer TPA oversight.

Motor remained under pressure. Motor Own Damage incurred claim ratio rose to 108.85% in FY26 from 104.22% in FY25, while Motor Third Party increased to 113.86% from 108.17%. Management pointed to the lack of third-party premium revision and rising court awards as ongoing stress factors. In the earnings call, management described a deliberate recalibration of the Motor book, including churning and shedding high loss ratio accounts and shifting toward selective underwriting in own damage.

Marine was another swing factor. Marine incurred claim ratio increased materially to 86.74% in FY26 versus 53.74% in FY25, which the company linked to multiple claims including cargo and a vessel-related fire incident.

Market share and growth: domestic business outpaced the industry

For Indian business, management stated that the general insurance industry grew 9.3% in FY26, while the company’s domestic gross direct premium grew 10.9%, supporting a market share increase from 12.56% to 12.74%. Segment market share numbers were also disclosed: Fire 17.56%, Marine 17.77%, Motor 9.91%, Health and PA 14.93%, and Others 15.13%.

Management positioned the market share gain as strategy-led rather than price-led. In Q&A, leadership argued that growth was concentrated in targeted retail segments and that underwriting discipline is centrally guided and monitored.

Distribution continued to be broad based. For FY26 Indian business, brokers accounted for 35.79% of premium, direct business 30.13%, agency 25.91%, dealers 7.56% and bancassurance 0.61%. Management indicated an intention to grow the agency and alternate channels to support the retail pivot.

Strategy and execution themes: retail push, MSME traction, and technology rebuild

The strategic messaging for FY26 and into FY27 was consistent across the presentation and the call: deepen retail and MSME traction while protecting the corporate franchise. Management reported that MSME premium grew 25% in FY26, supported by simplified offerings such as Bharat Laghu Udyam Suraksha. Building on this, the company has entered FY27 with a stated mandate to Go Retail, using the distribution and digital infrastructure strengthened during the MSME campaign.

On product innovation, the company highlighted plans to launch new products with focus on Retail and MSME and to enter newer lines such as parametric insurance. Management also discussed a new War Cover add-on for the Fire segment, positioned as a response to heightened geopolitical risk and historical exclusions in standard Fire policies.

Technology and servicing upgrades were presented as a key enabler. The company cited a call centre offering services in seven regional languages, a revamped website, WhatsApp services in eight languages, an AI and ML chatbot, ongoing claim automation, a customer portal for standard products, and mobile apps for customers, intermediaries and surveyors. Management stated the IT infrastructure revamp has been initiated and is nearing completion, and that digital marketing and sales have been piloted for some Health products.

Balance sheet indicators remained within stated comfort levels. Solvency ratio was 1.84 times in FY26 versus 1.91 times in FY25. Assets under management were 96,652 crore compared with 98,045 crore, with management citing investment monetization and market volatility. Net worth increased to 23,619 crore from 21,884 crore.

Takeaways: FY26 shows resilience, but underwriting remains the core work

FY26 for The New India Assurance was a year of two stories. The first was steady premium growth and improved reported profits, supported by stronger investment income and a domestic business performance that outpaced the industry. The second was underwriting pressure driven by Motor third-party stress, marine loss experience, and a large wage and pension revision that management fully quantified and absorbed during the year.

For FY27, management guided to double digit growth for the overall book, while keeping Motor growth to single digits to prioritize profitability. The effectiveness of the Motor portfolio churn, the sustainability of Health improvement, and the payoff from technology-led servicing and retail distribution expansion will be the key signals to track.