ICICI Lombard net profit slips 9% in Q3 on higher costs, claims

ICICI Lombard General Insurance Company

• ICICI Lombard Q3 net profit dropped 9% to Rs 870 crore due to higher expenses.
• Premiums rose to Rs 7,433 crore, but claims and costs surpassed earnings.
• Solvency ratio stayed strong at 2.69 times, above regulatory requirement

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ICICI Lombard General Insurance reported a 9 percent year-on-year decline in net profit for the December quarter (Q3 FY26), as higher operating costs and claims weighed on profitability, even as premium growth remained healthy.

On a one-nine (1/n) basis, profit after tax (PAT) stood at Rs 659 crore, compared with Rs 724 crore in the year-ago quarter. PAT came in at Rs 680 crore.

Gross direct premium income (GDPI) grew 13 percent year-on-year to Rs 7,041 crore, compared with Rs 6,214 crore in the December quarter of last year, driven by growth across motor and health segments.

Despite higher premium collections, profitability was impacted by a rise in claims and expenses.

Net incurred claims, including changes in outstanding claims and IBNR provisions, increased during the quarter, while commission payouts and operating expenses also moved higher.

As a result, underwriting performance weakened, with the combined ratio deteriorating to 104.5 percent in Q3 FY26, indicating that claims and expenses exceeded earned premiums. The incurred claims ratio rose to 68.7 percent, while the expense ratio remained elevated.

Investment income provided some cushion, with net investment income rising to Rs 909 crore during the quarter, aided by better yields, but this was insufficient to offset underwriting pressure.

During the quarter, the company also recognised an incremental gratuity expense of Rs 53 crore as a past service cost following the notification of the new labour codes, which had an adverse impact on profitability.

For the nine months ended December 31, 2025, ICICI Lombard reported PAT of Rs 2,941 crore, compared with Rs 2,651 crore in the corresponding period last year, supported by steady growth in premiums and investment income.

The board had earlier declared an interim dividend of Rs 6.50 per share, which was paid during the quarter. The insurer’s solvency ratio stood at 2.69 times, comfortably above the regulatory requirement, underscoring a strong capital position.