Non-Life Insurers Report Alarming FY26 Deficit

In fiscal year 2026, the non-life insurance industry, encompassing public and private general insurers, standalone health insurers, and specialized public sector insurers, reported significant financial challenges. According to the General Insurance Council, the sector incurred underwriting losses amounting to ₹31,043 crore for FY26. This marks a concerning trend for the industry's core business profitability.

Public sector general insurers were major contributors to this escalating deficit. Their combined underwriting losses rose to ₹29,071 crore in FY26, a stark increase from the previous fiscal year. Following a review of their financial performance for 2025-26, the Finance Ministry has directed these public sector entities to focus on improving insurance penetration and reducing claim ratios. The secretary emphasized the need for profitable business lines and measures to lower the incurred claims ratio (ICR).

Private sector general insurers also experienced an increase in underwriting losses, accumulating ₹16,682.34 crore in FY26. Tata AIG General Insurance led these losses among private players at ₹2,442.25 crore, followed by ICICI Lombard with ₹1,024 crore. Bajaj General Insurance showed the best performance with a loss of ₹103.29 crore, while HDFC ERGO reduced its losses to ₹1,042.89 crore.

Except for Universal Sompo General Insurance, nearly all private and public sector general insurers, as well as standalone health insurers, posted combined ratios above 100% in FY26. This indicates that their claims and operating expenses exceeded premium earnings. Oriental Insurance, for instance, had a combined ratio of 145.71%, United India Insurance 144.45%, and New India Assurance 122.55%. Standalone health insurers like Galaxy Health Insurance and Narayana Health reported even higher combined ratios, exceeding 156%, largely due to elevated management expenses.