Now Reading: Shriram General posts 23% premium growth, flags EV insurance caution
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Shriram General posts 23% premium growth, flags EV insurance caution
Shriram General posts 23% premium growth, flags EV insurance caution
Shriram General Insurance posted 23% premium growth in the June quarter, more than double the industry average of 11%, writing about Rs 1,180 crore in premiums versus Rs 960 crore a year…
Shriram General Insurance posted 23% premium growth in the June quarter, more than double the industry average of 11%, writing about Rs 1,180 crore in premiums versus Rs 960 crore a year ago. Motor premium grew 25% and non-motor 18%, lifting the insurer's overall market share to 1.34% from 1.21%.
Net profit rose only 5% to Rs 131 crore, which MD and CEO Anil Aggarwal attributed to the inability to book capital gains from equities amid market conditions. He said the company is cautious on electric vehicle insurance, citing rising battery repair costs, and will only enter the segment aggressively if adequate reinsurance support is available. The insurer's solvency ratio stood at 3 times, which Aggarwal expects to fall to about 2.6 times by year-end as growth continues.
Indian Opinion Analysis
Shriram General's caution on EV insurance reflects a sector-wide wait-and-watch approach. Unlike traditional motor policies, where decades of claims data allow precise pricing, EVs present unknowns: battery replacement costs can equal the vehicle's value, and repair networks are still sparse. Insurers need reinsurers to back EV portfolios, but global reinsurers have been hiking rates on battery-related risks after a spate of high-value claims in Europe and the US. The Insurance Regulatory and Development Authority of India (IRDAI) has nudged the industry to develop EV-specific products, but without adequate reinsurance capacity, most general insurers are holding back. The coming quarters will show whether IRDAI mandates a pool mechanism, as it did for third-party motor insurance, or allows the market to find its own pricing equilibrium.
Source: bfsi.economictimes.indiatimes.com
This story was synthesised by AI from the source linked above.
