General Insurance Corporation of India (GIC Re) Q3 FY26 Earnings Call Summary

Summary

General Insurance Corporation of India - Q3 FY 2026 Earnings Call Summary Wednesday, February 11, 2026, 11:00 AM IST

Event Participants

Executives 2 Hitesh Joshi (Executive Director, Addl. Charge of CMD), Sanjay Mokashi (GM & Chief Underwriting Officer)

Analysts 5 Janish Shah (Individual Investor), K. Karthikeyan (Individual Investor), Madhukar Ladha (JPMorgan), Ritika Dua (Bandhan), Sanketh Godha (Avendus Spark), Shobhit Sharma (HDFC Securities)

Financials & KPIs

Geographic & Segment Commentary

• Domestic Business: Represents 77% of 9M premium at ₹25,388.97 crore. Management aims to mirror the Indian market growth of 9-12%, focusing on maintaining market share while managing competitive pricing in property and motor lines.
• International Business: Represents 23% of 9M premium at ₹7,587.29 crore. GIC Re is working to “claw back” business lost during previous credit rating downgrades, targeting a 60/40 domestic-to-international mix over 3-5 years.
• Motor & Cargo (International): These segments faced high combined ratios (Motor 190%, Cargo 282%) due to reserve strengthening in Israel, Turkey, and China. Management is de-risking these portfolios and realigning shares to ensure a turnaround.

Company-Specific & Strategic Commentary

• Underwriting Discipline: Management is targeting a 100 bps improvement in the composite combined ratio annually through selective risk deployment rather than volume-led expansion.
• Credit Rating Recovery: Following the October 2024 rating upgrade to ‘A’, GIC Re is re-entering high-quality panels in Japan and Taiwan, though full restoration of market share will take 3-5 years.
• Catastrophe (CAT) Reserve: The corporation has built a ₹2,000 crore strategic kitty to buffer the P&L against major climate jolts, with a major review planned once the reserve reaches ₹5,000 crore.
• Obligatory Cessions: Currently at 4%, management noted that any regulatory reduction in obligatory rates would be mitigated by converting 25-50% of that volume into voluntary business.

Guidance & Outlook

Risks & Constraints

Q&A Highlights

Domestic Growth & Obligatory Cession

• Question: What is the impact if the government reduces the obligatory cession rate? (Janish Shah)
• Answer: It is not a straight loss; 25% to 50% would likely convert to voluntary business. It frees up capital to be deployed in more attractive segments like international catastrophe covers (Hitesh Joshi).

International Performance

• Question: Why are international motor and cargo combined ratios so high? (Madhukar Ladha)
• Answer: High ratios resulted from reserve strengthening in specific regions like Israel and Turkey. Management is actively de-risking these lines during recent renewals (Sanjay Mokashi).

Agricultural Segment

• Question: How will the new 80-110 or 60-130 tender cycles affect the Agri book? (Sanketh Godha)
• Answer: Different states have different preferences; while some models reduce reinsurance demand, others like the “burn cost” method or a shift to 60-130 could increase it (Sanjay Mokashi/Hitesh Joshi).

Pricing Environment

• Question: Is the market hardening or softening in commercial lines? (Sanketh Godha)
• Answer: Property pricing is under pressure due to heavy competition among insurers, though energy and refinery segments are holding better. Overseas January renewals were soft due to excess market capacity (Sanjay Mokashi).

Key Takeaway

GIC Re delivered a stable Q3 FY26 performance with a 10.2% growth in Gross Premium to ₹10,986.55 crore, supported by a strong solvency ratio of 3.87. While domestic growth remains aligned with the broader Indian market, the international portfolio is undergoing a transition period as the company utilizes its restored ‘A’ rating to reclaim high-quality business lost in previous years. Management achieved a 251 bps improvement in the combined ratio to 105.32%, despite loss pressures in international motor and cargo lines stemming from geopolitical volatility in the Middle East. The strategic focus remains on a disciplined 1% annual improvement in the combined ratio and the build-up of a ₹5,000 crore catastrophe reserve. Looking forward, GIC Re expects to maintain a steady 8-10% growth rate while balancing the shift from obligatory to voluntary business in a moderately softening global pricing environment.