GIC Re pushes 50-50 international goal into long term as foreign book shrinks
General Insurance Corporation of India’s long-pursued 50-50 domestic-international split is now ‘absolutely a long-term goal’, chairman Hitesh Rameshchandra Joshi told analysts on the state-owned reinsurer’s first quarter earnings call, as the corporation reset its working target to 60-40.
Joshi said the medium-term goal was now 60-40, but cautioned that the domestic market continues to outgrow global markets, so ‘it will be a tough shot’. International business accounted for 14% of gross premium in the June quarter, down from 25% in FY26, according to the company’s investor presentation.
When asked about a 6% decline in the foreign book, chief underwriting officer Sanjay Mukherjee attributed it to a portfolio rethink, adding that GIC Re had taken hard decisions in motor, streamlined the aviation book, and scrutinised overseas cargo.
An analyst asked whether GIC Re could return to the nearly ₹18,000 crore of foreign premium it had generated at one time, Joshi said it may take three to four years rather than two because of the softening reinsurance market, where the same risks are being covered at lower premiums. “Maybe not in a couple of years, because of the significant softening trends, the same exposure is coming at a lesser premium. But maybe not in two years, maybe three or four years,” he said.
In place of a single group-level target, GIC Re has split its profitability goals by geography. Joshi said the company was now working towards a combined ratio of around 103 for the domestic book and 95 for the foreign book, in line with global markets. The corporation was ‘fairly close to 103’, while the 95 mark would likely take two to three years. The combined ratio measures how much an insurer pays out in claims and expenses for every rupee of premium it collects, where a figure below 100 signals profitable underwriting.
The presentation shows a domestic combined ratio of 107% for the quarter against 102% in FY26, and an international combined ratio of 95% against 120%. Overall combined ratio improved to 104.88% from 106.94% a year earlier. Profit after tax was ₹1,922 crore on gross premium of ₹13,475 crore.
On the credit rating, which sits at A- (Excellent) from AM Best, Joshi declined to commit to a timeline for an upgrade, saying that the business model, global softening and the coming shift to International Financial Reporting Standards (IFRS) and risk-based capital. He said it was “not really possible to give any timeline”, though “if things go all right” one could expect it in something like four to five years.
Solvency stood at 4.32 times at the end of June, up from 3.85 a year earlier. Management said the ratio may decline gradually, since ‘we don’t want to grow at the cost of profitability’.
The domestic book is also being reshaped, with obligatory cessions that every general insurer must pass to GIC Re, falling to 33% of the domestic book in the quarter from 42% in FY26. Joshi confirmed it was an effort to grow the non-obligatory book.
Joshi said the Insurance Regulatory and Development Authority of India issued a directive on 22 July flagging rates being quoted in the property segment on the direct side. It described the directive as ‘only a guidance’, with the impact likely to show over the next two to three quarters.
