DFS Reviews Public General Insurers, Pushes for Lower Claim Ratios Amid Solvency Concerns
The DFS has reviewed the performance of state-owned general insurers, with a focus on reducing loss ratios and strengthening financial stability.
DFS reviews public sector general insurers, urging stronger underwriting discipline and lower claim ratios.
New Delhi – DFS: The Department of Financial Services (DFS), Ministry of Finance, held a performance review meeting on 2 September 2026 with the Public Sector General Insurance Companies (PSGICs), chaired by Secretary Sanjay Lohiya. The meeting examined the financial and business performance of the state-run general insurers for FY 2025–26, covering underwriting performance across all lines of business, key performance indicators (KPIs), digital initiatives and other operational matters.
DFS Orders Focus on Profitability and Claims Ratio
Lohiya advised the PSGICs to sharpen their focus on profitable lines of business and adopt measures to bring down the Incurred Claim Ratio (ICR). He also called for greater use of technology and faster digitalisation across operations, while urging the companies to optimise spending on information technology and other digital initiatives.
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The Secretary emphasised the need for PSGICs to improve communication, publicity and customer outreach, including through social media and other platforms, to build greater awareness of insurance products and expand reach into underserved segments and geographies.
Lohiya directed the companies to work on improving insurance penetration and density while narrowing protection gaps. He called for a robust, standardised KPI framework across all PSGICs to allow consistent and comparable assessment of both financial and non-financial performance, to be reviewed on a quarterly basis.
On the customer service front, the Secretary directed PSGICs to ensure expeditious redressal of grievances, with explicit emphasis on the quality of redressal rather than speed alone.
DFS: A Parliamentary Panel Had Already Flagged the Underwriting Problem
The review comes against the backdrop of the 32nd Report of the Committee on Public Undertakings (COPU) for 2026-27, chaired by BJP MP Baijayant Panda, which examined the performance of India’s seven insurance-sector Central Public Sector Undertakings (CPSUs) over a two-year study that began in February 2025.
The COPU report found that three of the four PSU general insurers — National Insurance Company Limited (NICL), Oriental Insurance Company Limited (OICL), United India Insurance Company Limited (UIICL) and The New India Assurance Company Limited (NIACL) — had been operating below the regulatory solvency floor for three consecutive financial years, with their accounting profitability propped up largely by gains on their equity portfolios rather than by the core business of underwriting insurance.
Read against that finding, Thursday’s directive to bring down the Incurred Claim Ratio addresses the same underlying weakness the parliamentary committee had identified: a persistent gap between premiums collected and claims paid, masked at the bottom line by investment income.
DFS: Who Attended the DFS Meeting
The review was attended by top leadership from all four PSGICs:
Rajeshwari Singh Muni, CMD, National Insurance Company Limited (NICL)
Bhupesh S. Rahul, CMD, United India Insurance Company Limited (UIICL)
Sanjay Joshi, CMD, Oriental Insurance Company Limited (OICL)
Dr. Lavanya R. Mundayur, CMD, Agriculture Insurance Company of India Limited (AICIL)
S. Sivasankar, Executive Director, The New India Assurance Company Limited (NIACL)
Representing DFS, the meeting was also attended by Additional Secretary Dr. Debasish Prusty, along with other senior officers of the department.
