PROFITS RISE 78% AT NEW INDIA ASSURANCE, UNDERWRITING INCOME FALLS

India’s largest general insurer New India Assurance has reported a 78% increase in post-tax profit for financial year 2005-06. The company made Rp7.16bn, up from Rp4.02bn in the previous year. Gross written premiums in India rose 13.8% to Rp47.9bn, compared with Rp42.1bn in 2004-05. International business fell away slightly with gross written premiums falling to Rp8.84bn, compared with Rp8.92bn. The technical result was hit by the Mumbai floods, higher wages and third-party motor losses. The wage bill rose to Rp13.1bn from Rp11.9bn the previous year. For the full year the underwriting gain was Rp360m, down from Rp2.32bn in 2004-05. This was more than compensated for by an increase in investment income to Rp20.11bn from the previous year’s RP14.5bn. However, Rp11.4bn of this gain came through the realization of gains through sales. Meanwhile, New India has said that it is planning “several initiatives” in the health sector to exploit rapid growth in the sector. Managing director B Chakrabati said that New India would create policies for three different segments — urban, semi-urban and rural. He noted that health policies accounted for just over 10% of New India’s premiums last financial year — up by nearly a third on the previous year — and that the claims ratio had been about 110%. This high ratio was caused by New India’s greater concentration of policies in the older age groups. Mr Chakrabati said that “we are trying to give incentives for people in the younger age band to buy mediclaim”.