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Informist, Friday, Jan. 17, 2025

--ICICI Lombard: See IRDAI's new accounting norms impacting long-term pdts 

--CONTEXT: Comments by ICICI Lombard's mgmt in a post-earnings analyst call 

By Ashna Mariam George and Sourabh Kumar

MUMBAI – ICICI Lombard General Insurance Co. Ltd. will continue to push the sale of long-term products despite the new norms by the Insurance Regulatory and Development Authority of India on accounting of long-term health insurance policies having an adverse impact on them, the company's management said in a post-earnings analyst call on Friday.

"As far as growth is concerned, there is an overarching impact in terms of long-term products being sold," the management said. "From an organisation perspective, the economic value that comes in selling the long-term product stays intact. So we continue to pursue in the market selling long-term products."

According to the insurance regulator's new accounting norms, non-life insurers must report premiums on an annual basis for all policies underwritten after Oct. 1. While non-life insurers can still underwrite long-term policies, premiums for only one year are to be recorded. This change will hurt premium growth in Oct-Dec on a quarter-on-quarter basis.

On Friday, ICICI Lombard reported a net profit of INR 7.24 billion for Oct-Dec, up 4.4% from Jul-Sept, with the company saying the numbers for the reporting quarter and the nine months ended December are not comparable on an on-year basis due to the new accounting norms. The company announced its results after market hours. Its shares ended 2.1% higher at INR 1,948.75 on the National Stock Exchange.

The company's management told analysts on Friday that it expects the general insurance sector to perform robustly in Jan-Mar. "As we move towards the next quarter, we believe infra-based spending, lower insurance penetration, enhanced risk awareness in a conducive regulatory environment is expected to have a positive impact on the general insurance sector over medium to long term," Sanjeev Mantri, managing director and chief executive officer, said.  End

Edited by Ashish Shirke

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