1.

ICICI Lombard General Insurance said its net profit increased

32% year-on-year to ₹591 crore in the second quarter ended
September 2022 from ₹447 crore a year ago, led by higher
premium income, despite a slight uptick in claims.

Net profit was helped by a reversal of tax provision of ₹128 crore during the
quarter, excluding which the year-on-year profit growth would be 3.4% for
the quarter under review.

2. Key Financials

With a market capitalisation of Rs 55294.55 crore, the company operates in

the Insurance - Non Life industry. For the quarter ended 30-Jun-2022, the
company reported consolidated sales of Rs 4149.38 crore, down 13.55 per
cent from the previous quarter?s Rs 4799.75 crore and down 21.54 per cent
from the same quarter a year ago. The company reported net profit of Rs
349.03 crore for the latest quarter, up 130.19 per cent from the
corresponding quarter last year.

3. ICICI Lombard General Insurance Company Board Meeting

Outcome for Outcome Of The Board Meeting Held On
Tuesday, October 18, 2022

Pursuant to Regulation 30, 33, 52 and other applicable provisions of the

Securities and Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015 ("Listing Regulations"), we wish to inform
you that the Board of Directors of the Company, at their Meeting held today i.e.
Tuesday, October 18, 2022, have approved interalia:? Audited Financial Results
of the Company for the quarter and half-year ended September 30, 2022. ?
Declaration and Payment of interim dividend oft 4.50/- per equity share i.e. at
the rate of 45.0% of face value oft 10 each, for the financial year ended March
31, 2023.
4. CICI Lombard General Insurance Company Announcement
under Regulation 30 (LODR)-Allotment of ESOP / ESPS

 Allotment of Equity Shares under ICICI Lombard Employees Stock

Option Scheme-2005This is to inform that the Company has allotted
1,775 (One Thousand Seven Hundred Seventy Five Only) Equity Shares
of ? 10/- (Rupees Ten Only) each on September 26, 2022 to the eligible
employee(s)/participant(s) who had exercised the stock options under
ICICI Lombard Employees Stock Option Scheme-2005.

 The said equity shares shall rank Pari-passu with the existing equity
shares of the Company in all respect.

 The above information will also be available on the website of the

Company at https://www.icicilombard.com.You are requested to kindly
take the same on records.
5. Buy ICICI Lombard; target of Rs 1450: Motilal Oswal Motilal
Oswal's research report on ICICI Lombard

 The underwriting loss for ICICIGI stood at INR1.5b in 2Q as against

INR1.9b in 1QFY23, as OPEX grew at 9% as compared to a 11% growth
in NEP.

 Claims ratio grew to 72.8% in 2Q v/s 72.1% in 1QFY23 as the benefits of

a lower loss ratio in Motor TP and Fire were offset by higher claims in
Motor OD and the Health segment. Claims ratio grew 300bp YoY.

 Investment income, at INR8.7b, was higher than our expectation of

INR7.4b owing to better yields. The combined ratio stood at 105.1% v/s
105.3%/104.1% in 2QFY22/ 1QFY23.

 The solvency ratio stood at 2.5x v/s 2.6x in 1QFY23. Adjusted for a tax
reversal of INR1.3b, PAT stood at INR4.6b (est. INR3.8b). Reported
PAT stood at INR5.9b.

6. ICICI Lombard gets IRDAI's 'in-principle approval' to

acquire Bharti AXA General Insurance

 The Insurance Regulatory and Development Authority of India (IRDAI)

on November 27 gave an in-principle approval to the acquisition of
General Insurance business of Bharti AXA General Insurance Company
Limited by ICICI Lombard General Insurance Company Limited, the
company said in an exchange filing.

 Earlier, BSE Limited, National Stock Exchange of India Limited and the
Competition Commission of India (CCI) had approved the proposed
acquisition by ICICI.
7. Coronavirus impact: Health insurers buck the trend, see rise in
Q1 premiums despite industry slump

 The general insurance industry has seen a 4.2 percent year-on-year (YoY)
decline in the gross direct premium for June quarter (Q1) of FY21 at Rs
39,329.62 crore in the wake of the coronavirus outbreak.
 However, the pandemic looked to be bringing good news for standalone
health insurers with gross direct premiums seeing 15.8 percent YoY
growth to Rs 3,232.10 crore.
 For the general insurance industry as a whole, the good news is that
premiums grew by 7.8 percent in the month of June 2020 to Rs 13,961.25
crore compared to the same period last year. This data would prove that
some green shoots are emerging in the sector.
 IRDAI data showed that excluding the specialist insurers (like
Agriculture Insurance Company, ECGC) and standalone health insurers,
the non-life industry saw a 6 percent YoY decline in gross direct
premium to Rs 35,667.60 crore.

8. Confusion prevails among borrowers over three-month

moratorium as many get EMI reminders

 Many borrowers, credit cardholders and mutual fund investors have

received SMSes from their lenders reminding them that they need to
maintain sufficient balance on the due date. Among others, such
messages have been received by people who have taken personal, auto
and home loans.

 With many getting payment reminders, confusion prevails among

borrowers, term-plan investors and credit cardholders over the
implementation of the three-month moratorium on all loan repayments
amid disruptions caused by the coronavirus outbreak.
 As part of measures to alleviate hardships faced by people, the Reserve
Bank, on March 27, announced a slew of steps, including a three-month
moratorium on loan repayments.
9. Insurers exit government's Fasal Bima scheme to cut losses

 While all other general insurance schemes have a policy of annual hike in
premium, PMFBY does not have this provision. This has made the
business unviable for insurers and reinsurers

 The government’s flagship Pradhan Mantri Fasal Bima Yojana

(PMFBY), or crop insurance scheme, is likely to see a crunch in
insurance capacity as companies as well as re-insurers move away from
offering covers.
 While on one hand, re-insurers have increased rates for offering cover to
insurers, on the other, claims continue to pile up. Firms like ICICI
Lombard General Insurance as well as a slew of foreign re-insurers have
taken a stand to not write crop insurance till there is an improvement in
the rates.

10. Writing crop business does not make economic sense right
now, says ICICI Lombard CEO

 The crop insurance business is not making business sense for the zlargest
private sector general insurer ICICI Lombard General Insurance. In the
post results earnings call, Bhargav Dasgupta, MD and CEO, ICICI
Lombard General Insurance, said that they have not been able to write
any new crop business in H1FY20 due to the prevailing rates.

 "On the one hand, reinsurers have hardened rates. On the other, the
commissions that reinsurers pay is not even sufficient to cover the basic
cost of sourcing business. Hence, it does not make economic sense," he
added.
 Despite no major drought-like situation in the country, Dasgupta said that
the crop losses have been on the rise. The rise in these underlying losses,
he said, has led to the hardening of rates. Here hardening of rates means
that an insurer has to pay more to secure a cover from a reinsurance
company.
11. Non–life insurers report robust premium growth in
February; buy ICICI Lombard on dips

Market share continues to edge up for private insurers

 Overall growth in premium was led by private general insurance

companies, which reported a 26 percent growth in the current fiscal till
February-end. On the other hand, premium growth of four state-owned
general insurance companies was almost flat around a percent in the same
period. Consequently, private players continue to gain market share,
which now stands at around 48 percent as compared to 40 percent for
state-owned insurers.

12. SC third party motor insurance ruling: Here’s how it

impacts general insurance companies

 General insurance companies can see higher premium growth due to long
term third party motor insurance policies but profitability still uncertain

 Motor insurance is offered for private motor cars, two-wheelers and

commercial vehicles and consists of third party liability (TP) as well as
own-damage cover (OD). The latter protects a vehicle owner from
damage or theft to his/her own vehicle. OD coverage is optional and
insurers can set premiums freely based on their risk parameters.

 Third party motor insurance mandatory but a tariffed product TP motor

insurance covers the legal liability for the damage caused by the insured
vehicle to a third party in case of bodily injury, death and damage to third
party property. Unlike OD motor insurance, TP motor insurance is
mandatory. Every motor vehicle owner in India is required to purchase
TP motor insurance and insurers cannot refuse to sell customers the same.

 TP motor insurance is a tariffed product, which means pricing in the

segment is regulated. The premium rates for TP motor insurance are set
by the Insurance Regulatory Development Authority of India (IRDAI)
and reviewed and adjusted every year by them using a prescribed formula
which considers cost inflation, frequency of claims, average claim size
and expenses.
13. Fairfax sells 12 pc shares of ICICI Lombard for USD 548

mn

The shares were sold as part of ICICI Lombard's initial public offering,
which values ICICI Lombard at about USD 4.6 billion (Rs 30,000
crore).

 Canada-based Fairfax on Wednesday said its wholly owned subsidiary,

FAL Corporation, has sold 12 percent shares of ICICI Lombard as part
of the insurer's IPO for about USD 548 million.

 The shares were sold as part of ICICI Lombard's initial public offering,
which values ICICI Lombard at about USD 4.6 billion (Rs 30,000 crore).
 "Upon completion of the transaction, Fairfax's share ownership in ICICI
Lombard will be approximately 9.9 percent," Fairfax Financial Holdings
Limited (Fairfax)said in a statement.
 Shares of ICICI Lombard General Insurance Company recovered from
initial losses to end over 3 percent higher than the issue price of Rs 661 in
the debut trade.

14. ICICI Lombard General Insurance Company -

Announcement under Regulation 30 (LODR)-Credit Rating

 Reaffirmation of ICRA credit rating on ? 35 Crore Subordinated Debt of

ICICI Lombard General Insurance Company Limited.We wish to inform
you that pursuant to Regulation 30 read with Schedule Ill of the SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015,
ICRA Limited vide its letter dated September 20, 2022 has reaffirmed its
"[ICRA] AAA (stable)'''' rating assigned to ? 35 Crore Subordinated Debt
of the Company.Further, please note that the Company had exercised Call
Option for redemption of 2,200, 8.98% unsecured, subordinated, fully
paid-up, unlisted, redeemable and non-convertible debentures of face
value of ? 1,000,000 each at par aggregating to ? 220 crores bearing ISIN
INE513L08016 on August 23, 2022. Accordingly ICRA Limited vide its
letter dated September 20, 2022 had withdrawn the rating assigned to ?
220 crores Subordinated Debt of the Company.Please find enclosed
herewith aforesaid letters issued by ICRA Limited.
15. Motor insurance losses for general insurers to pile up in H2

 The loss ratio in motor insurance segment is likely to rise for the general
insurance sector in H2 FY20. A dip in automobile sales and inadequate
premiums in the non-life industry has led to loss ratios going up to almost
200 percent in the business.
 Loss ratios are an indicator of the underwriting performance of an
insurance company. If the loss ratio is below 100 percent, it means that
the premium collected is adequate to pay claims. If it is above 100
percent, it is an indicator that there is a mismatch.
 Last year, loss ratios had crossed 150 percent due a series of flood-related
claims.
 The rise in catastrophic events-led losses has already led to the rise in
underwriting losses. For instance, ICICI Lombard General
Insurance  -- the only listed general insurer -- posted an underwriting
loss of Rs 102.10 crore in Q2 FY20 compared to an underwriting profit of
Rs 30.95 crore in the year-ago period.

16. Non–life insurers report robust premium growth in

February; buy ICICI Lombard on dips

 ICICI Lombard, the largest private sector non-life insurer, is well poised for
earnings growth, with an increase in insurance penetration, focus on
profitable segments and improvement in operating efficiency. The stock is
up 25 percent in the last one year and has significantly outperformed the
Nifty index. At the current market price of Rs 974, the stock is richly valued
at 8.7 times its 9M FY19 trailing book value.
 Leading companies in the secular growth sector tend to trade at a higher
multiples for a long period in time. In the absence of suitable and
comparable listed peer, ICICI Lombard trades as a proxy for the sector,
commanding a higher valuation. While the premium valuation will sustain,
near-term upside in the stock price is limited. Nevertheless, for investors
with a long-term horizon and wanting to participate in the growth in non-life
insurance sector, the stock is worthy contender.