Thank you, Hamsha. Good afternoon to all the participants on the call, and thanks for joining Q2 FY26 earnings call for General Insurance Corporation of India.

Please note that we have mailed out the press release and presentation to everyone, and you can now see the results on our website. It has been uploaded on the exchanges as well.

In case you have not received the same, you can write to us, and we'll be happy to send it over to you. Before we proceed with the call, let me remind you that the discussion may contain forward-looking statements that may involve known or unknown risks, uncertainties, and other factors.

It must be viewed in conjunction with our businesses that could cause future results, performances, or achievement to differ significantly from what is expressed or implied by such forward-looking statements. To take us through the results for the quarter and answer our questions, we have with us Mr.

Hitesh Joshi, Executive Director (Additional Charge of CMD), and other top members of the management at GIC. We'll be starting the call with a brief overview of the quarter gone by, which will then be followed by a Q&A session.

With that said, I'll now hand over the call to Mr. Joshi.

Over to you, sir.

Good morning, ladies and gentlemen. Thank you for joining today's earnings call.

I welcome you all, and am pleased to provide an overview of GIC Re's financial performance for the Q2 FY26. The global operating environment remains marked by macroeconomic uncertainty, inflationary pressures, and heightened geopolitical risk.

These factors, along with the growing incidence of climate-related events, continue to shape pricing conditions and capital deployment across the reinsurance sector. At the same time, market softening in key lines and improving investment yields are contributing to a more balanced operating landscape.

Against this environment, GIC Re has maintained a disciplined approach anchored in selective underwriting, calibrated portfolio management, and a stable risk appetite posture. This is reflected in our Q2 FY26 performance, where the combined ratio improved to 109.15% year-on-year, reflecting firmer pricing and a more favorable claims experience in core segments.

Catastrophic events and secondary perils remain key focus areas, and we continue to refine our models and exposure frameworks accordingly. Supported by strong capital adequacy, robust risk systems, and enhanced analytical capabilities, we are well positioned to manage cyclical shifts while preserving long-term profitability.

With clear strategic priorities and disciplined execution, we remain confident in our ability to address evolving competitive landscape and capitalize on emerging opportunities. We will now move to a review of our financial performance for the quarter, followed by question-and-answer session.

Gross premium income for Q2 FY26 stood at ₹9,601.70 crore compared to ₹8,413.49 crore in the corresponding quarter of the previous year. Investment income for the quarter stood at ₹3,791.67 crore as compared to ₹3,483.32 crore.

Incurred claim ratio for the quarter was 81.5% as against 93.6% in the corresponding quarter of the previous year. Combined ratio stood at 109.15% compared to 114.05% in the same quarter last year.

Adjusted combined ratio was 84.04% for half year FY26 as against 88.86% in the previous year. Profit before tax stood at ₹3,472.76 crore for Quarter 2 FY26 as compared to ₹2,281.12 crore.

Profit after tax rose to ₹2,866.79 crore as compared to ₹1,860.75 crore. Solvency ratio improved to 3.85 as of September '25 compared to 3.42 as at September '24.

Net worth excluding fair value change was ₹46,669.38 crore as at September end '25 as against ₹39,481.33 crore as at September end '24, while net worth including fair value change stood at ₹88,709.19 crore as at September end '25 compared to ₹90,907.70 crore. On the premium breakup, domestic premium for first half FY26 was ₹17,080.66 crore, and the international premium was ₹4,909.05 crore.

The percentage split was domestic 78% and international 22%. The domestic premium witnessed a growth of 4.6%, while the international premium grew by 9.4%.

This quarter reaffirms the strength of our strategic direction and our disciplined approach to navigating market conditions. As we move forward, we remain focused on executing our strategy with rigor and delivering sustainable value to our stakeholders.

Thank you, we can move to the question-and-answer session.

Thank you for the opportunity. This is MW Kim from JPMorgan.

I would like to ask about the company's capital deployment plan for next 12 or the 24 months. As suggested in the first half of '26 underwriting performance for major non-life insurers, the domestic underwriting is approaching to the peak of deterioration, signaling potential for the premium hikes in the motor and the health lines.

The overseas market is showing some softening, but the risk-reward profile remains attractive with a much lower combined ratio outlook compared to the domestic market. My question is, what do you see as the optimal underwriting mix between domestic and overseas business?

That's my first question. My next questions concerns the risk management.

Recently, the company got another the year of the A- rating from the AM Best, indicator relatively strong capital base and good risk management practices. Compared to the last 2, 3 years, has the company made an improvement in its risk management approach?

If this is the case, can you share a relatively more detail? Finally, the one more question is about what are the company's expectation for January 2026 renewal season and the outlook for the global reinsurance pricing cycle?

Thank you.

Thank you, Kim. I will first talk about the optimum international domestic portfolio mix.

It is very difficult to say what is optimum because see, pricing environment during last 2 to 3 years has been fairly dynamic. Indian market has its own pricing dynamism.

From a medium-term perspective, GIC Re's objective has been to achieve domestic versus foreign of 60:40. That is what guidance we have been giving to the analyst and the market.

Then we have to recognize that Indian market is growing at a much better pace than the international market. While there is a commonality in the reinsurance market, there is also something unique about the Indian market in terms of reinsurance price adequacy.

We would choose to react to the price adequacy evaluation and our cycle management and our portfolio optimization. While we will try to move towards 60:40, we would not be really drawn towards 60:40 in a very major way.

We will continue to choose our way through risk selection to move in this broader direction of 60:40. Your second question was regarding the improvements that we have carried out in our risk analysis.

We would like to say that it is a continuous process as to how the loss trends are evolving, whether it is in domestic market, original market, or international markets, also the attritional versus cat, and also the pricing trends. Whatever algorithms we have in our internal pricing evaluation and pricing tools, we keep on refining it.

If you have anything more specific, maybe we can discuss it, maybe we can take it offline as to what we are doing internally. Coming to January '26 renewal, given that we are coming off from the January '23 unprecedented hardening that the reinsurance market witnessed across the globe, very, very significant hardening which was not witnessed in last at least maybe 2 to 3 decades.

Coming from that huge price correction, the softening is going on. At the same time, we believe that underwriting discipline is being maintained by the market.

There will be softening, and there can be pockets where there can be a little divergent trend. Again, the client experience, the particular loss history of a client will be a major factor in how the account will be treated.

I hope I have answered, and maybe you can have a follow-up question if you like.

Thank you so much for the detailed explanation. All answers are very helpful.

Thank you.

Thank you.

Hi. Good afternoon.

A couple of questions, sir. The first one is if I look at life, particularly domestic side, the combined ratio in this half is still 114-odd percent.

Now is it an outcome of that the pricing environment, or is it due to maybe the payouts or some adverse kind of a development as far as the mortalities is concerned in this year? That is on life because at 114%, 115%, and particularly when life is not something that you have been a very, very kind of a big or aggressive, this 114% looks a bit on the higher, definitely on the higher side.

That's on life. The other question is on, if this obligatory, say, cession is to go, then how do you see your domestic business resetting?

Will there be a reset once and then you come back to normal growth, or you are confident of kind of maintaining your current domestic business even if the obligatory cession had to be abolished? Thank you.

Thank you, Avinash. Coming to that combined ratio that you are talking about, 114, I think this has been touched in Quarter 1 also, and it is thanks to the reserve strengthening.

I will request Mr. Sindhi to fill in the details, who is our actuary for life.

Hi. Are you audible?

Yes. I can hear you, sir.

Good afternoon. I'm Appointed Actuary Life.

Yes, your concern is correct, which is 114%. The primary reason is strengthening of our reserves.

Last time also we discussed that. You will see a similar kind of trend, a loss ratio above 100% in the coming two or three quarters.

The reason being, we priced some of the products long time back. Post-COVID, we started doing the experience analysis.

Some of our businesses are not as per what we estimated the mortality. Obviously we have to strengthen our reserves.

If I go a little bit detail, as far as earned premium is concerned, there is 11% growth compared to last year's, because last year's it was ₹880 crore around, now it is around ₹975 crore. Similarly, as far as paid claims are concerned, again, there is a growth.

Obviously we are writing more business, obviously we are expecting more paid claims to be coming in. Why the ratio is going above 100%, the reason being, we have started strengthening our reserves based on our experience.

We hope it will continue for another two or three quarters. That's the main reason of loss ratios being 114% for domestic business.

Sir, if you can clarify, this adverse mortality experience than your kind of a built-in or expectation, is it coming in retail protection or is it part of credit life or group protection?

So... Again, if we just go a little bit details, again, we just divide our business into a long-term business and the short-term business.

Short-term business, obviously it is like a one-year term insurance kind of a business like your non-life business. Now here, the main reason is it is coming from the long-term business.

Now long-term means it's an individual kind of a business. For example, companies have been writing individual term insurance, endowment, and other kind of plans, it's on a long-term basis.

We already gave those rates, and obviously we expected that our experience would be better, but now we can't change it, that is number one. When I talk about long-term, it consists of not only long-term business individual, but it consists of credit business also.

As you also know that credit life business, it's a long-term business, the term [holding?] from 5 years to 20 years.

Obviously if we combine both, our experience has not been favorable so far, obviously we don't have any other option rather accept strengthening our reserves. That's the primary reason for that.

This will continue for next two or three quarters, that is what we are expecting.

Got it, sir. Sir.

Avinash, I come to your second question regarding obligatory. The first we would like to say that it is not expected that this entire obligatory would be removed by the regulatory in one go.

That is a broad expectation. Secondly, in view of the emerging IFRS and RBC regimes, we can expect that there will be better capital planning and deployment and usage of reinsurance by the market.

If any reduction in obligatory is likely to result into diversion of business other than say elimination of business for us, quite a substantial part of it may come to us on a voluntary basis. Apart from that, as we have been mentioning that since we got our rating restoration of A- in October '24, which we could not fully avail of during our January '25 renewal, which we hope to leverage during January '26 renewal, I think reset will be a very strong and harsh word to frame the situation which might emerge due to any change in obligatory.

We are fairly confident that we will sail through smoothly due to any change in this. Thank you.

Got it, sir. Thank you, sir.

All the best.

Good afternoon, sir. Thank you for taking my question.

Sir, I would like to understand about your outlook on different segments, like where do you see fire, and I wanted to specifically ask about health because of the reduction in the GST. How do you see the premiums coming in from health, life going forward, and your outlook in totality of gross premium, how do you expect the gross premium to grow in, say, next two years ahead from now?

I would like to say that broadly our growth in the segment should mirror the market growth. To a great extent, health is a class which doesn't necessarily require reinsurance, but there can be treaties which are trying to optimize the capital structure of a particular insurance company.

I will hand over to Mr. Sanjay Mukashi, our Chief Underwriting Officer, to talk in more details.

Yes, Mr. Harsh, this is Sanjay Mukashi here.

You asked about fire insurance. Yes, this particular component is a major component in our business mix.

Our growth will also depend upon fire segment, but it will come largely from the foreign fire. As Mr.

Joshi while answering previous question mentioned that we got our rating restored to A- by AM Best last year. Since the rating was restored in October, we could not fully leverage that rating during last renewal season, but for 1/1 renewal season, upcoming renewal season, we are expecting that we will see growth.

Of course, this will be a measured growth. There won't be any change in terms of our risk selection or underwriting approach to it.

This also is a comment in totality for what growth we are expecting. You mentioned about health, and Mr.

Joshi mentioned that health is going to be a driver of insurance growth in the domestic market, but it may not essentially drive our growth. It will entirely depend upon what kind of reinsurance requirement the insurance companies may have going forward.

Okay. Understood, sir.

How do you see combined ratio going forward, sir? Maybe FY20 Can you give just a ballpark number for FY26, '27?

I think whatever we have guidance given earlier, that broadly remains. The direction we have chosen will be maintained, and we continue to stick to the same guidance.

That would be all from my side. Thank you.

Thank you.

Hi. Thank you for the opportunity.

Good afternoon to all. I have couple of questions.

One is, see, we have good solvency ratio, and our risk management, everything has improved. What's the outlook?

Is there any chance for upgrade going forward in the next year?

Are you talking about upgrade in our credit rating from A- to A+?

Something like that. Yes.

I think it will be a while before we can pitch for that because it involves say certain more stringent evaluation of the entire operations right from say balance sheet to P&L to competitive position to the ERM framework. Going by where we stand today, I think we are decently positioned to avail and exploit the opportunities available on the international business.

Presently, it is not really a target for us because it requires, as I said, also a higher capital adequacy. The solvency that you are seeing is essentially based on the framework as prescribed by IRDA, which is a formula-based solvency calculation.

If you really go to how the international credit rating agencies evaluate the balance sheet, they are already on a mark-to-market basis. While our solvency might materially change due to our various operations, the underlying economics and driver of the risk-based capital doesn't show up so much volatility in our solvency.

I am not sure whether I have communicated adequately, but the point is that IRDA formula is based on book value, and rating agencies already look at market value, they will not react to higher solvency as per the domestic regulatory regime.

If we include the fair value of all the other market holdings, the solvency will be much more higher, right, from current 3.85?

Absolutely. That is from the Indian regulatory position and evaluation as per IRDAI regulations, but rating agencies are already factoring that in.

Global rating agencies already factor in mark-to-market of the entire portfolio.

Okay. Even if we adapt the IFRS 117 and the new accounting standard, even then we will not be able to be gearing up for an upgrade?

No.

Okay.

That is all Yeah. Please go ahead.

No, you are saying something.

All the factors, as I said, balance sheet, P&L, competitive position, and ERM framework are adequately factored in by the rating agency, and that is independent of the local regulator evaluation.

Got it, sir. The next question, see, we have increased the operation expenditure this specific quarter, and even for the half year, any specific reasons for the increase?

Did we do any major expenditure for...

There is one particular demand on the value added tax in a foreign jurisdiction on our branch, which we feel is absolutely unjustified and we are going into appeal. That is the figure which is distorting to the extent of something like ₹60 crore, that is jacking up our EOM to that extent.

Got it, sir. Got it.

It is a one-off thing, and it will be appealed.

Okay. Last question I have is the growth in terms of the GST reduction and all that, where do we see growth in the H2, the second half of the current financial year?

I would like to say that whatever GST impact is there will be more visible on the direct side, and it will be factored in there, and whatever is the RI growth that we will be mirroring the RI growth of the market, broadly speaking.

You're not expecting any bump or any increase the second half of the year in terms of gross premium?

If there is a bump in the direct side, it will definitely result into some domino effect on reinsurance side.

Sir. Thank you and all the best.

Thank you.

Hello, sir. Actually, I wanted to know about fair value change numbers for Q2 in FY26 versus Q2 FY25.

Can you make it more elaborate what exactly fair value?

Actually, as in the net worth including fair value change, what is that for the current quarter or for the H1 FY26? Like last year it was 40,117-odd crores for fair value change.

For the quarter, it is ₹42,039.82 crore.

Okay. As

at quarter end, this is the figure, ₹42,039.82 crore.

All right. Thank you.

Thanks.

Sir, one follow-up that I have is the commission paid for this quarter has increased. Is it because of the combined improving in the health, is that the reason why the commissions increased?

Mr. Mukashi will respond.

Thank you.

Mr. Karthik, commission increase is not because of health.

It is actually because of some of the entries, reversal entries or adjustment entries that we have carried out during this quarter and also previous quarters, but if you see, they will get evened out during the rest of the year. That's in a way nature of our business and accounting.

The 25% premium, that will not be showing up in the next coming quarters, right? That'll get evened out.

Yes, yes.

See, Mr. Karthik, the core commission level doesn't fluctuate so much.

It is the commission entries on account of profit commission and sliding commission, which is adjusted after a lag for a previous years that is booked in the current quarter. Any volatility in that is not because of underlying business changes, but because of certain accounting entries getting booked after a lag.

Got it, sir. Thank you.

Thank you.

Sir, just a follow-up question. I just wanted to confirm that I think in Q4 FY25 you had guided for 34% growth.

Is that correct, or I am mistaken here?

Sorry, I didn't catch properly. In Q4 of FY25, what happened?

FY25, you have guided for 34% year-on-year growth for FY26 as well, or am I mistaken here?

34%? No, no, I don't think.

That kind of growth cannot be imagined. No, you are saying 34%, is it?

Yes.

No, no, no way.

Okay. Can you just provide a number, sir, here, please?

See, the thing is, as we have been mentioning, that as far as Indian market is concerned, our growth will mirror the growth of the Indian reinsurance market, and what we talked about earlier that in October '24 we got our rating restoration, we'll be able to leverage it. On a relatively say, if I might use the word, small base of say 22% of foreign business, it might see a double-digit growth.

Then that January foreign business will get booked over a period of next six to eight quarters. It may not be so very visible even if there is a very very significant say growth.

It takes time to get and it shows in accounting figure with a particular leg. Yeah.

Okay. That was very much helpful.

Thank you, sir.

Thank you. Thank you.

Thank you all for being present for this call. As we have been mentioning that there are certain structural changes which we embarked on following our rating downgrade in July 2020 and which bore fruit by way of restoration of rating in a period of just over four years.

The same path that we have charted out for ourselves in terms of underwriting discipline, pricing adequacy, portfolio rebalancing, and cycle management, we'll continue to stick to this path, which we are convinced, given the trajectory of the financial performance that we have witnessed during last four years, it is creating value, it will continue to create value, and we will keep on responding by way of evolution of our underwriting processes. We hope to deliver growing value.

Thank you.