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ICICI Lombard General Insurance Company · ICICIGI

ICICI Lombard's profit growth on a year ago came from investments, not from underwriting

Profit before tax rose 27.8%, but investment income grew by more than the whole gain, claims and costs stayed above premiums, and the return-on-equity range went unmentioned.

Published · Inve Research Desk

ICICI Lombard General Insurance Company stock page → More news from 15 Oct 2026

A claims desk piled with motor claim files sits next to a thick ledger of investment holdings.
Illustration: Inve Research Desk

27.8%

rise in profit before tax, second quarter

Investment income alone rose by more than the whole increase in profit, and the insurance business itself ran at a slightly worse combined ratio than a year ago.

How they did last quarter

Better than a year ago on profit, no better on underwriting, and behind the industry on headline premium growth for the half-year.

  • Profit before tax
    INR 13.59 billion, +27.8%
    vs INR 10.63 billion a year earlier on the company's own comparative; the half-year is still 5.8% lower
    A rebound in the quarter, but the half-year is below last year.
  • Combined ratio
    104.5%
    vs 103.9% a year earlier
    Claims and costs exceeded premiums by slightly more than a year ago, so underwriting did not drive the rise on a year ago.
  • Gross premium growth
    +5.4% for the half-year
    vs industry +8.9%; January 2026 guidance: "we have tried to see if we can be 100 to 200 basis point at a Company level better than the industry growth"
    Behind the industry for the half-year; the January aim was for the coming year, and excluding crop and mass health the second quarter was 13.9% against 13.2%.

The jump in profit is the investment book

The number holders of ICICI Lombard will hear first is 27.8%: that is how much profit before tax rose in the September 2026 quarter, against the company's own figure for a year earlier. It is real. It is also not quite what it looks like. Investment income rose by INR 3.05 billion, and the whole increase in profit was INR 2.96 billion, so by our arithmetic the investments account for all of the improvement and a little more.

Capital gains did most of the lifting: INR 4.53 billion against INR 2.36 billion a year ago, which by our arithmetic equals 73% of the rise in profit before tax. A capital gain is a profit from selling a security, and it depends on markets far more than on anything the company does in a quarter.

Underwriting did not get better

An insurer earns from two sources: the premiums it keeps after paying claims and costs, and the money it holds in between. The combined ratio measures the first. Above 100% it means the insurance itself loses money. It was 104.5% in the quarter, against 103.9% a year earlier. Excluding catastrophe losses, which the chief financial officer raised unprompted, the ratio was flat on the year. Flat is a fair thing to report. It is not a recovery.

Half-year profit before tax is still 5.8% below last year.

Two lines from earlier calls went unrepeated or softened

The first is return on equity, which is profit as a share of shareholders' capital. Last October the company said it had stayed around a range of 18% to 20%, and in January it said it was trying to see if it could continue to sustain it. The half-year figure is 16.8%. We searched the call for the range and did not find it. This was the quarter with a 23.7% return, and the range went unmentioned.

The second is the price of third-party motor cover, a tariff product whose price insurers do not set themselves. In July the company called an upward revision necessary and urgent. On this call an executive was asked whether the tariff could instead be revised down. The reply, from an ICICI Lombard executive, was: "The answer is yes. How and when? This only time will tell." The case for a price rise has become a case for uncertainty.

What we do not know yet

We do not know whether the investment gains repeat. On its April call the company reported an impairment on equity investments, a reminder that the same book can cut the other way. We also do not know whether the range for return on equity still stands; the next results will show what the company chooses to say about it.

A target that is neither withdrawn nor repeated is hard to hold anyone to. On this call the company talked about the quarter's profit and left the range out, though it reported the half-year return that sits below it.

ICICI Lombard General Insurance Company stock page →

The record: notes, full financial tables

Notes

  1. Impact 4/5 Margin Mixed

    ICICI Lombard Q2 profit before tax up 27.8%, but investment income rose more

    Profit before tax in the September 2026 quarter was INR 13.59 billion, 27.8% above the company's comparative for a year earlier. Investment income rose INR 3.05 billion while profit rose INR 2.96 billion, and the combined ratio was 104.5% against 103.9% a year earlier. Half-year profit before tax is still 5.8% lower. On 15 July the company had reported a 46.1% fall for the quarter before, on the company's earlier 1/n accounting basis.

  2. Impact 4/5 Risk Mixed

    ICICI Lombard: INR 1.65 bn motor provision is all; no third-party loss ratio on the call

    The company said the INR 1.65 billion provision it took in the June 2026 quarter for the Supreme Court motor judgment is all it sees as the impact for now. Its motor loss ratio was 65.4% for the half-year against 66.6% a year earlier, inside its 65-67% band. Four analysts asked about the third-party loss ratio; management gave no third-party figure on the call, pointing instead to the all-motor ratio and its 65-67% band. In July it had expected the industry's third-party loss ratio to rise 12-15%.

    “what we took for quarter 1 is all that we see as the impact of the Supreme Court judgment at this point of time”— Gopal Balachandran, chief financial officer

  3. Impact 4/5 Risk Negative

    ICICI Lombard now says third-party motor tariffs could fall, after July's call for a rise

    Asked on the call whether third-party motor tariffs could be revised down, an executive said yes, with the timing unknown. In July the company had called an upward revision necessary and urgent, and in April it said the industry's rise was overdue. An analyst put to management that the regulator's distribution consultation could cut commissions significantly; the chief financial officer called a 25% expense-of-management trajectory a positive and said the company has always been within 30%.

  4. Impact 3/5 Guidance Negative

    ICICI Lombard did not repeat its 18-20% return-on-equity range; half-year is 16.8%

    The company did not state its 18-20% return-on-equity range on the call; we searched the transcript for it. Last October it said it had stayed around that range, and in January it said it was trying to see if it could continue to sustain it. The company reported return on average equity of 17.8% for FY26 on 20 April and 16.8% for the first half of FY27. The second quarter alone was 23.7%, in a quarter where capital gains were 33% of profit before tax by our arithmetic.

  5. Impact 3/5 Guidance Mixed

    ICICI Lombard premium growth 5.4% in H1, 3.5 points behind the industry

    Gross premium rose 5.4% in the first half of FY27 against 8.9% for the industry. Excluding crop and mass health, the second quarter grew 13.9% against 13.2% for the industry, the measure management leaned on. In January the company said it was trying to grow 100 to 200 basis points faster than the industry. Management put the gap down to caution in crop underwriting.

    “So we actually had an outperformance in terms of the overall numbers”— Gopal Balachandran, chief financial officer

  6. Impact 3/5 Guidance Negative

    ICICI Lombard filed IFRS figures but gave no combined-ratio impact on the call

    The chief financial officer confirmed the first-quarter IFRS financials were filed with the regulator by 30 September and said the company would come back at a separate time. In April the chief executive said the year of adoption would bring a significant decline in combined ratio, of 300 basis points to perhaps 450. We searched the call for the impact and did not find it.

    “we will obviously come back and maybe at a separate point of time”— Gopal Balachandran, chief financial officer

Financials

Income statement, last 8 quarters

₹ crore; YoY and margin in %
Quarter endSalesYoYOperating profitOp. marginOther incomePBTNet profit
Jun 20267,088+10.8%5227.4%14.0536403
Mar 20266,825+12.8%68610.1%32.0718547
Dec 20256,905+12.1%85412.4%16.0870659
Sept 20256,869+11.7%1,04415.2%33.01,077820
Jun 20256,396+14.2%98115.3%13.0994747
Mar 20256,051+12.2%60910.1%60.0668510
Dec 20246,161+18.6%96215.6%−2.0960724
Sept 20246,147+16.6%94015.3%−21.0919694

Balance sheet

₹ crore
As ofEquityDebtInvestmentsFixed assetsCWIPTotal assets
Mar 202616,6330.058,33883488.076,111
Sept 202515,9960.056,2008430.059,281
Mar 202514,4850.053,50872874.069,145
Mar 202412,20535.048,58493094.063,308