Money & Banking

New India Q2 profit rises to ₹530 crore

Our Bureau Mumbai | Updated on November 13, 2019 Published on November 13, 2019

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New India Assurance reported a 61 per cent year-on-year (y-o-y) jump in second quarter net profit at ₹530 crore, against ₹329 crore in the year-ago period. Gross written premium (before deductions for re-insurance and commissions) during the reporting quarter rose 27 per cent y-o-y at ₹8,249 crore. Net premium written (after deductions for re-insurance and commissions) was up 20 per cent y-o-y at ₹5,962 crore.

The premium earned (net) increased 12 per cent y-o-y at ₹5,857 crore. The income from investments (net) was up 20 per cent y-o-y at ₹1,137 crore.

On the expenses side, the net commission paid was flat at ₹527 crore. Operating expenses were up 17 per cent at ₹914 crore. Incurred claims increased by 6 per cent at ₹4,584 crore.

The solvency ratio, which indicates whether an insurer’s cash flow is sufficient to meet its short and long term liabilities, edged down to 2.08 from 2.13 in the preceding quarter. In its notes to accounts, the company disclosed that it has investments of ₹17.84 crore in equities and ₹128.25 crore in debentures of IL&FS-related entities as on September 30, 2019.

During the half year ended September 30, 2019, the company made additional provision of ₹13.50 crore against the debenture holding in respect of secured non-convertible debenture in IL&FS. Hence, total provision against the debentures holding in IL&FS-related entities, stands at 84.89 crore as on September 30, 2019.

The company said it has investments of ₹74.84 crore in Debentures of Dewan Housing Finance Corporation Limited (DHFL) as on September 30, 2019. During the quarter ended, the company made a 10 per cent provision of ₹7.48 crore.

During the quarter, the company made 100 per cent provision of ₹33.08 crore against investment made in equity of Reliance Communications Ltd due to net worth erosion of the underlying investment.

Published on November 13, 2019
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