General Insurance Corporation of India

NSE:GICRE

Q4-2025 Earnings Call

[Operator]

Ladies and gentlemen, good day, and welcome to the General Insurance Corporation of India Q4 FY '25 Earnings Conference Call.

[Operator Instructions] Please note that this conference is being recorded.

I now hand the conference over to [ Ms. Nikita ] from E&Y. Thank you.

And over to you, ma'am.

[Unknown Attendee]

Thank you, Manav. Good morning to all the participants [indiscernible] for joining Q4 FY '25 Earnings Call for General Insurance Corporation of India.

Please note that we have mailed out the press release to everyone, and you can now see the results on our website. And it has been uploaded on the stock exchange as well. In case you have not received the same, you can write to us, and we'll be happy to send it over to you.

Before we proceed with the call, let me remind you that the discussion may contain forward-looking statements that may involve known or unknown risks, uncertainties and other factors. It must be viewed in conjunction with our businesses that could cause future results, performance or achievement to differ significantly from what is expressed or [ employed ] by such forward-looking statements.

To take us through the results of this quarter and answer our questions, we have with us the management of GIC, represented by Mr. Hitesh Joshi, Executive Director; and other top members of the management. Please note that CMD is not available for call today due to unavoidable travel plans. We'll be starting the call with a brief overview of [indiscernible], which will be then followed by the Q&A session.

With that said, I now hand over the call to you, sir, Mr. Joshi. And over to you, sir.

[Hitesh Joshi, executive]

Good morning, ladies and gentlemen. Thank you for joining us today for the earnings call.

I am pleased to present to you GIC Re's financial performance for the fourth quarter of FY 2025. In an environment marked by macroeconomic volatility and evolving industry dynamics, our performance trends -- as a reflection of GIC Re's enduring strength, strategic foresight and commitment to core reinsurance principles. As a global reinsurer, we recognize that our role is inherently tied to managing uncertainty, balancing risk with resilience and opportunity with discipline. We remain steadfast in our belief that effective risk management, thoughtful diversification and disciplined underwriting from -- form the cornerstone of sustainable reinsurance practice. While catastrophic events remain an inherent part of our business landscape, we continue to approach them with prudence supported by [indiscernible] framework and the long-term vision of value creation.

Our consistent focus on improving portfolio quality, sharpening of our strategic direction and aligning our operations with market realities have enabled us to navigate complex market conditions without compromising on underwriting integrity. We strive to maintain a healthy combined ratio and outcome that stems from deliberate choices and an unwavering focus on operational excellence. For FY '25, the combined ratio stood at 108.8%. This disciplined posture has not only fortified our financial position but has also deepened our understanding of market cycles and our own risk appetite. It is this clarity that positions us well to engage with both current challenges and future opportunities with confidence and purpose.

Now look at some of the key highlights of our financial performance. Gross premium income for quarter 4 FY '25 stood at INR 10,367.08 crore compared to INR 8,723.65 crore in the corresponding period of the previous year. Investment income for the quarter stood at INR 3,903.02 crore [indiscernible] INR 3,036.52 crore for the corresponding period.

Incurred claim ratio for the quarter was 82.2%, as against 68.9% of the corresponding quarter of the previous year. Combined ratio for the quarter stood at 103.56% compared to 89.26% for the corresponding period in the previous year. Adjusted combined ratio factoring in policyholder's investment income stood at 85.79% for FY '25, as compared to 86.24% in the previous year.

Profit before tax stood at INR 2,922.66 crore for quarter 4, as compared to INR 3,171.33 crore in the corresponding period of previous year. Profit after tax was INR 2,182.88 crore, as compared to INR 2,642.47 crore in the corresponding period.

Solvency ratio for the year-end improved to 3.70, as compared to 3.25 for the previous year.

Net worth excluding fair value change was INR 43,106.52 crore on 31/03/25, as against INR 37,581.78 crore in the previous year-end. Net worth including fair value change stood at INR 83,224.33 crore as on year-end compared to INR 81,330.25 crore at the previous year-end.

On the premium breakup, domestic premium for the year FY '25 is INR 30,662.44 crore. And the international is INR 10,491.51 crores. The percentage split is domestic 75% and international 25%. The domestic premium for the year grew by 18.8%, while international business witnessed a decline of 7.8% over previous year.

While underwriting profitability remains at the core of our strategic focus, our pursuit of excellence, combined with targeted initiatives and a prudent approach to risk, has reinforced the strength and stability of our overall performance. This positions us well to seize opportunities that are not only aligned with our risk appetite but also support our long-term vision for sustainable growth. As we look to the future, our priorities remain clear to uphold underwriting discipline, enhance operational efficiencies and deliver enduring value to all of our stakeholders.

I would like to take this opportunity to express my sincere gratitude towards shareholders, clients and employees for their continued confidence and support.

With this, I conclude the remarks and open the floor for Q&A. Thank you.

[Operator]

[Operator Instructions] We have our first question from the line of Sanketh Godha from Avendus Spark.

[Sanketh Godha, analyst]

Sir, a few questions. The first question is on the growth, especially on the international business, in the fourth quarter and which looks -- I mean, if I look at the numbers year-on-year, it has declined, but in the fourth quarter, the growth is around 35 percentage. So sir, I just wanted to understand. This growth is sustainable. And how much it is driven by any pricing environment change in Jan renewals. Or because of your rating change, you probably will have more contracts that contributed to the growth. So if you can split this growth basically led by price hikes, rating change and maybe volume growth, that will be useful, sir.

[Unknown Executive]

This is [indiscernible], GM, reinsurance. I would answer to the growth. The fourth quarter growth is mainly factored into -- resulting from the rating upgrade of GIC, wherein we got the rating upgrade in the month of November '24. And that has been passed on to our insurance and reinsurance. And based upon the information, we are able to write some of the new accounts in the January renewal. And that has catered to the growth in international business in the fourth quarter.

[Sanketh Godha, analyst]

And any benefit of pricing environment changing with respect to...

[Unknown Executive]

[indiscernible] I would say pricing, international market, what I saw in the 1st January renewal is quite soft. And so far, direct market is concerned. And both in domestic and foreign, it is quite soft, except for the accounts where there are some losses. And those [indiscernible] particularly the [indiscernible], could attract some of the [ loadings ], ranging from 10% to 15%. Otherwise, the market has got a bit of soft, in comparison to the previous year.

[Sanketh Godha, analyst]

This is only 2[indiscernible] international business you are saying, right, sir?

[Unknown Executive]

Yes, yes, yes.

[Sanketh Godha, analyst]

Okay, okay. And sir -- then this 35% growth, what you reported in fourth quarter. Because of the rating change, can we assume this growth is sustainable for FY '26 [ only ]?

[Unknown Executive]

Yes. Now that we got our rating back and the international market is aware of it -- and no doubt they are coming and offering the new accounts to us. Or wherever we lost the accounts, we are trying to regain them. So naturally this process will continue going forward. And our international branch -- our branches, we are also likely to get the benefit out of this rating upgrade.

[Sanketh Godha, analyst]

Got it, sir. And sir, we still have a higher combined ratio in international business [indiscernible] percentage, though it is improving every year. So with this rating upgrade, this -- any outlook you want to give. This 121% can improve to what extent in '26 because of you winning better contracts.

[Unknown Executive]

If you see, in comparison to last year, our international business and the rating -- I mean the rates -- the combined ratio has actually come down, in comparison to the March '23. If you look at -- March '24. March '24, it was something 108%. And now that has come down -- incurred claims ratio has come down to 100% this year. So naturally, the combined [indiscernible] to the normal claims, we had the other expenses and commission. That's why it is [indiscernible] at a higher level, but going forward, yes, we will try to improve further. And we would like to follow the underwriting discipline that we have been following. And we will also improve the other -- I mean look at the improved market and international markets where we can improve the combined ratio.

[Sanketh Godha, analyst]

Got it, sir. And second -- one more question which I had, sir, is that there is a lot of news regarding that obligatory business could be further reduced from 4 percentage because -- in the news, there are many articles saying that the industry, general insurance industry, is making a represented to -- representation to lower it for GIC Re, obligatory business to be lower. So if you have heard anything from government or IRD on those lines. I mean any waterfall what they have given that how gradually it will be reduced. Or it will be holding up at 4 percentage itself.

[Unknown Executive]

We have no information or advice from either the regulator or the ministry. I think these are the usual efforts made by the industry and particularly certain [indiscernible], so -- which makes the news. But we have no information, no official news, either from the regulator or from the industry.

[Sanketh Godha, analyst]

Okay, sir. And sir, if you can give your obligatory business probably combined ratio or loss ratio compared to the company average or domestic business average loss [indiscernible] that will be useful just to understand whether obligatory [ part ] is much more profitable compared to overall company domestic business.

[Unknown Executive]

Not really. See the point is that obligatory would constitute, say, something like 30% of our book. And there is always a risk-return trade-off, so it is not correct to say that, "This is more profitable." And our -- given our focus on underwriting discipline, our rest of the book is also improving, not only domestically but also for international, so there should not be any concern on that count that profitable business will go away. We will -- we are continuing to improve the quality of the rest of the portfolio.

[Sanketh Godha, analyst]

Got it, sir. And sir, I mean, if I can ask a few more. Sir, if you can break down your combined ratio of international and domestic business into loss ratio and expense ratio. Because we have combined ratio numbers in the press release. We don't have loss ratio numbers. So if you can give the loss ratios numbers of international and domestic business separately for full year, it will be useful, sir.

[Technical Difficulty]

[Operator]

Ladies and gentlemen, thank you for patiently waiting. We have the management back with us. Over to you, sir, again.

[Sanketh Godha, analyst]

Sir, I was asking the breakup of domestic business and international business combined ratio into loss ratio and expense ratio, I mean, for the full year. And if you do it -- yes.

[Unknown Executive]

Sorry. Sanketh, this is Sanjay Mokashi, general manager, reinsurance department. The loss ratio for the domestic portfolio annually is at 85.3%. And for foreign business, it is 98.9%.

[Sanketh Godha, analyst]

98.9 percentage and 85.6 percentage, you said, right, sir?

[Unknown Executive]

Yes.

[Sanketh Godha, analyst]

Okay, okay. And sir, one...

[Unknown Executive]

Sorry, Sanketh. I'll correct myself. It is 96.5 for foreign.

[Sanketh Godha, analyst]

96.5 for foreign for the full year, right, sir?

[Unknown Executive]

Yes, yes, full year.

[Sanketh Godha, analyst]

And domestic, you said 85.6, right, sir?

[Unknown Executive]

Yes...

[Unknown Executive]

85.33...

[Unknown Executive]

[indiscernible].

[Unknown Executive]

85.33.

[Sanketh Godha, analyst]

Okay, okay, okay, got it, sir. And sir, in the result, I can again see that you made a catastrophe reserve of almost 6,000 crores, which you also did almost similar number last year. Just...

[Unknown Attendee]

600...

[Sanketh Godha, analyst]

Sorry, INR 600 crores. Sir, just wondering, sir. Suppose if a catastrophe event happens. You will try to take the hit through reserves in the future. Or you will continue to choose it through -- route it through P&L just to protect the P&L. I still want to understand the logic of creating so much of cat reserves incrementally in that sense.

[Unknown Executive]

So this reserve is being created in line with the cat reserve policy as approved by the Board. And we plan to build up this [indiscernible] to something like an amount of INR 5,000 crore. Till that [indiscernible] is built, we don't plan to recover or withdraw, draw down from this reserve. It will be straight to the P&L.

[Sanketh Godha, analyst]

Okay. And these cat reserves are used in solvency calculations, sir...

[Unknown Executive]

No..

[Unknown Executive]

No. Excluded for the purpose of...

[Unknown Executive]

Solvency.

[Unknown Executive]

Available assets.

[Sanketh Godha, analyst]

Okay, got it. And last one, sir, if you can break down your investment income for the full year and the current quarter into capital gains and the regular dividend/interest income.

[Radhika Ravishekar, executive]

This is Radhika Ravishekar here, CIO. The breakup of -- for the full year, investment income stands at 11,204. The income excluding profits, that is your interest, dividends, stands at 7,096 crores, which is a 10% increase from the previous year of 6,430 crores. Profits on sale is 4,108, as against 4,135. Despite the challenging market conditions, we have been able to maintain this profit on sale of securities.

[Sanketh Godha, analyst]

Got it, ma'am, perfect. This is useful. If I have any questions, I'll come back in the queue.

[Operator]

[Operator Instructions] We have our next question from the line of Prayesh Jain from Motilal Oswal.

[Prayesh Jain, analyst]

Just on this pricing in both domestic and international markets. On the fire piece in particular, we were hearing that the reinsurers have increased the pricing in -- on the fire side. Any comments there from your side?

[Unknown Executive]

Yes. [indiscernible], this is [indiscernible], GM, reinsurance. I would like to comment on that. See the -- this time, renewal, we have asked the companies with -- I mean all the insurance companies operating in India to how the -- in view of reduction in their premium quarter-by-quarter, I -- we asked them how they are going to improve their claims and how they are going to achieve their business targets. So the companies themselves has come to GIC with their [indiscernible] plan and their growth plan, wherein they assured us that they will be [indiscernible] to the IIB rates that has been prescribed erstwhile by IRDA. So on the basis of that, they have been following the process and they are following their business plan. So reinsurer has [ no role on that ]. As and when they come to GIC only for any [indiscernible] support -- we just wanted to ensure that they follow the rates that they have given [ as assurance ].

[Prayesh Jain, analyst]

So -- but sir, what have been the kind of renewal rates that would have happened on the same -- on a like-for-like basis?

[Unknown Executive]

They have been trying to adapt to the IIB rates, particularly from 1st of January '25, onwards. And there are aberrations as well, but there are few aberrations which some of the companies might have not adapt to.

[Prayesh Jain, analyst]

Okay, okay. And secondly, sir, in terms of growth. If -- for example, if the obligatory -- or hypothetically if the obligatory business 4% goes away. And I understand it's obligatory business is about 43% of your domestic business. Do you see this kind of getting impacted because some of the -- like, for example, health insurers wouldn't want to kind of continue with the obligatory insurance, reinsurance. So would that be a growth restrictor for you?

[Unknown Executive]

Prayesh, in this situation, if obligatory goes away, yes, there could be a hit, a temporary setback to the top line, but on the flip side, it gives us greater control on our portfolio. The entire risk selection is -- with our underwriting is based on -- will be based on our underwriting. Having said that, we have put in place a plan to overcome the short-term setback that we might have if obligatory goes away. And the approach generally would be to market the additional quota share treaty from the companies. So there are companies who are willing to increase their reinsurance with us, and we will take that opportunity. Currently we have been very conservative, very selective in that segment because we already have obligatory.

Having said that, there is another factor also, that we have been in this market for more than 50 years now. There is established relationship with the market, which will help us in leveraging these relationships. At the same time, we have the data. That data will also help us to strategize. And these are the things we will implement if and when obligatory goes up. As Mr. Joshi said, as of now, there is no information either from ministry or IRDA in this regard.

[Prayesh Jain, analyst]

Got that. And in terms of growth, how would you look at growth in the international business?

[Unknown Executive]

Yes. Going forward, our impetus is that we look forward to the new markets where we have been -- I mean, moved out. Or because of our rating [ downward ] in the year '20, we are not able to renew or -- some of the accounts. Now we are trying to look into those territories where we can reenter them and to bring about or to renew those accounts or to gain those accounts which are lost to us. So that way, we can get into those markets. And similarly, we are also looking into the accounts where we have a better opportunity or better control to increase our line. So that way, we want to increase our foreign business going forward.

[Prayesh Jain, analyst]

And any guidance [ on ] combined ratio improvement trajectory, which has been consistently improving for you guys over the last 4 years...

[Unknown Executive]

This year, the foreign combined, particularly this quarter, fourth quarter, is a dampener because of some of the events that is -- California fire; and some of the improvement of the losses, like Dubai flood and Nepal flood. All those things are coming up -- then Taiwan typhoon. Those figures are coming up or improving -- improved over the quarter, but we have been aware of the cat events. And we are following the cat modeling also to take leverage of our position. And that is how we want to improve the -- improve our underwriting as well as our business participation in the accounts, so as to improve our foreign combined ratio going forward.

[Prayesh Jain, analyst]

So overall, the combined ratio is -- we expect it to further improve by...

[Unknown Executive]

Yes. Currently it is 121-something. And we still wants to improve. If it can be around 110 or 115, that will be achievement by the year-end.

[Prayesh Jain, analyst]

Okay. So overall, we can still expect the overall combined ratio at the company level [ is 108.8% ] in FY '25. This can further improve to 106 levels.

[Unknown Executive]

Yes, around 106 [indiscernible].

[Operator]

[Operator Instructions] We have our next question from the line of [ Karthi Keyan ] from -- an individual investor.

[Unknown Attendee]

So I have 2 or 3 questions. The first question: See we always made underwriting profit in the Q4, the last quarter. And we haven't made any underwriting profit for this quarter. Any specific reasons for that?

[Unknown Executive]

See. If you look at the underwriting profit, it -- we have made some profit this quarter as well -- and what is that, this quarter profit? If you look at domestic profit this quarter, the combined ratio has come down on -- non-life domestic has come down to [indiscernible], as against 80% of -- for Q4 of last year. And if you look at the December quarter, it was 83.72%, whereas it is -- in Q4, it is 70.24%. This is for domestic. And if you look at for foreign, the loss ratio is -- yes, it is for 110.29% in last quarter, whereas it is [ 68.60 ] for this quarter. And the main dampener here is the foreign Q4. And that is mainly -- as I said before, it is mainly because of the California fire and then Taiwan typhoon. And there are some flood losses of Dubai and Nepal that has added to the losses. And in addition to that, there are some losses that has affected the -- like Israel and Turkey losses. Motor losses has added to that. That's why the losses -- I mean, the Q4 profit has come down in comparison to last year. Otherwise, if you look at the overall performance of the organization on a year-on-year basis, it is quite improved. If you look at the entire year, we have made a profit of 8,700-odd crores, as against 7,000-something last year. So as a reinsurer, we do not go by quarter-on-quarter. Rather, we look at the overall performance of the company from -- for the annual period. So that is why, the reinsurer, we look at.

[Unknown Attendee]

So the life -- whatever losses we had in this quarter, right, it's all due to the catastrophic events.

[Unknown Executive]

Cat events for which -- which have been reported for which we have made provisions. And there are some provisions also, additional provisions, [indiscernible] for...

[Unknown Executive]

Life...

[Unknown Attendee]

For the life part. I mean it has actually increased for the last year, if you look at [indiscernible], right? It has increased almost 2.5x.

[Unknown Executive]

Yes. That -- I will ask my actuary -- life actuary business [indiscernible]. And he's here with me. He will be addressing that. One minute, please.

[Unknown Executive]

This is [indiscernible] life actuary. So if you just see that -- yes, the losses are quite significant, mainly on account of 2 things. One is the net claims paid. So we paid actually net claims which are much higher compared to last year, 1,887 [indiscernible] paid during this year, number one. Second thing is obviously there are a lot of claims which have been reported, but we have not yet settled those games. Obviously we had to set aside reserves. So because of the reserve, setting aside the reserves; and those claims which we already paid, because of that, obviously your incurred claims have increased substantially compared to last year.

[Unknown Attendee]

Because there is not much of an event, right, I mean, in terms of life losses. Is it because of catastrophe event? Or I mean the increase, 2.5x, [ than ] last year. I mean, currently, how come the claims have increased so much in 1 quarter? I mean, even the quarterly, if you look at the numbers, sir -- I mean I am not able to make any sense out of the numbers.

[Unknown Executive]

Yes. So maybe to be very specific: There are no big losses, obviously, but there are many claims, as I told you. So if you really want the explanation, let's say here we are talking about incurred claims of, say, 2,900 [indiscernible]. So these incurred claims are made up of 3 parts. One is how much claims you have paid till that. That is 1,887. The claims which we are supposed to pay, that is the change in the -- we call this change -- additionally things, which is around 158.1% compared to last time. And the reserves. We have to set aside reserves also. As you also know, that life is a long-term business in nature, so we have set aside reserves. That is coming around 859 crores. That is a change in reserves. So if you combine all those things, because of that, your incurred claims have increased substantially compared to even last quarter and then the last year.

[Unknown Attendee]

So this trend will continue. Or there will be improvements going forward.

[Unknown Executive]

Yes. So we believe that -- as you also know, that Jan-Feb-March, the last quarter of the year for reinsurance companies. So obviously we get a lot of claim intimations and all those kind of things. And we believe that, if you just talk about coming quarters, obviously we don't expect this kind of trend will continue. We hope that it will settle down, but yes, this time, there is an increase because of this reason.

[Unknown Attendee]

Okay. Sir, another question. See we had -- I mean with regards to motor. I mean foreign motor [ and marine ] which we had discontinued. And we have like tail risks coming. So that has come to an end. Or how is that [indiscernible]?

[Unknown Executive]

Sanjay Mokashi here, [ Karthi Keyan ]. I won't say it has come to an end. Obviously such an arrangement has a tail. I can only say that the contract that we canceled in -- by the end of 2021, the effect of it is on the -- is waning. The tail continues. It has not come to an end, but it is certainly waning. And more importantly, we have created enough reserves in our books of account as well.

[Unknown Attendee]

So that's -- can we say that it will go away maybe by FY '26 or '27? How is it, that? And this seems to be a very long tail.

[Unknown Executive]

It is. Because the nature of that contract was treaties that were in return in motor and cargo segment. So it will always approach the graph asymptotically, the axis asymptotically. So the tail will be, in future, such that it will not, hopefully, impact our portfolio adversely.

[Unknown Attendee]

Okay, got it. Another question, sir. What will be the growth forecast for, like, both domestic and foreign combined for the next 2 years?

[Unknown Executive]

On an overall basis, we project a growth in our reinsurance business, which will be measured growth, of about 10% year-on-year for next 3 years.

[Unknown Attendee]

Okay, okay, okay. And final question. See the last quarter. I mean it's a very tough quarter in terms of the investment part, but there is a substantial growth, right, I mean, almost 28%. I mean, what drove the growth of the investment income?

[Unknown Executive]

[indiscernible]

[Unknown Attendee]

Can you give us a breakup, I mean, for the [ 3,900 crores ] [indiscernible]?

[Radhika Ravishekar, executive]

This is Radhika Ravishekar. Please repeat your question.

[Unknown Attendee]

The question is what's the investment -- I mean, the breakup -- I mean the gains, [ 3,900 crore ]. Can you give me the breakup of interest income, dividend and as well as the...

[Radhika Ravishekar, executive]

You're asking for the quarter...

[Unknown Attendee]

Yes, for the quarter. That's correct.

[Radhika Ravishekar, executive]

Yes. For the quarter, breakup will be, say, around 1,500 crores from profit on sales. And the balance will be interest incomes -- or interest and dividend income.

[Unknown Attendee]

Okay.

[Radhika Ravishekar, executive]

Because we focus more on the fixed income securities.

[Operator]

[Operator Instructions] We have a follow-up question from the line of Sanketh Godha from Avendus Spark.

[Sanketh Godha, analyst]

Awesome. Sir, one more question I had on growth. See [ health ] business has seen a significant growth in the full year, around 66-odd percentage. So on this big base, do you think this growth will be sustainable? Or we think -- or you think that the numbers might potentially come down in the full year of -- next year, I mean to say. And on similar lines, I just want to understand your outlook on crop incrementally because it's been declining every year. So now we do 3,200-odd crores of business in crop, so how do we see that playing out going ahead?

[Unknown Executive]

Sanketh, this is [indiscernible] again. As to the [ health ] portfolio, yes, we have seen fundamental growth -- I mean, phenomenal growth this year in comparison to last year. And this is mainly -- the concentration was on our retail, I mean, health business that we have categorically chosen to write. And going forward, yes, that achievement of this sort of growth will not be possible because all the [indiscernible] companies tends to [ harp on ] higher commission levels. And whether we can achieve -- I mean, able to meet their demands is a question going forward, so -- and particularly, currently, wherever we have participated of the -- participation on stand-alone, I mean, retail part is substantial. And then the group health also. Group health, usually we participate with some participation terms to reduce the outgo in terms of losses. So hopefully, the -- if the same trend is continued and if the companies are prepared to accept the same terms, then the growth will be in the range of, say, 5% to 10%, but the percentage of growth that we have seen this year is not likely to continue going forward.

[Sanketh Godha, analyst]

Got it, sir, but sir, if the commission demand is higher, then is it fair to say that this 9,500 crores of business what you did in [ fourth ] quarter might see a decline also because it might not be acceptable terms for you?

[Unknown Executive]

Yes, it may be possible, but the other way is that there are also new participants coming up who wants to have their participation in health line of portfolio. New insurance companies are also coming up. So they are also interested in the -- in participating in this retail line of businesses, where the expenses are minimal and whereby they can gain some mileage out of the expenses, to keep their expenses within the limit of IRDA. So this and crop are the 2 portfolios where the companies are more and more interested. So there we can extend our capacities with our terms as per our -- yes...

[Sanketh Godha, analyst]

Sir, on crop, any outlook you want to give? 3,200 crores will be stable, grow...

[Unknown Executive]

Yes. The -- see currently the crop portfolio has gone substantial changes. It has been -- the [ SSM ] model which has been [ in probe ] now in comparison and to the previous model of a PMFBY scheme where the liability was 250% -- whereas in this [ SSM ] model, the cap is at 110% -- or 130%, which is usually chosen by various states. So that is [ where ] premium has come down. And it has come down by more than 50%, 60% because the exposure is less. The insurance companies try to pass on the benefit on the premium front to the state insurers. So we have come up [indiscernible] this year. And hopefully, going forward, we will try to improve in the -- improve participation in the [ SSM ] model and the excess stop-loss model, whereby we can maintain or slightly increase the participation.

[Sanketh Godha, analyst]

Sir, are you seeing incrementally more states adopting that [ SSM ] model...

[Unknown Executive]

[indiscernible] -- yes. They are adopting this [ SSM ] model. For example, for a state like Maharashtra where the premium goes up to 10,000 crores to 12,000 crores, they have now opted for [ SSM ] model, wherein the loss capped -- loss is capped at 110%. So naturally the premium will come down by 50% to 60%.

[Sanketh Godha, analyst]

Got it, sir. And sir, lastly, if these 2 lines, say, remain subdued, then the price hike what you have experienced in fire segment will compensate for any growth, sir. Or what kind of growth you can expect in fire segment because of the pricing being -- going up [ from -- for ] January.

[Unknown Executive]

See. Pricing -- as I said, we are seeing the growth. Particularly the companies are following up the IIB rates, which itself will help the market to grow by 10% to 20% in the fire segment. So that will naturally add to the growth of our premium. The other aspect that you are telling, that the health and crop: Crop, we have been -- we are away from the crop portfolio because of the same increase in loss. And the premium flow -- cash flow is quite minimal, but of late, we have seen this [ SSM ] model wherein the companies and the states are prepared to pass on the [indiscernible] as early as possible. And we do see that there are some prospects of participation in some of the specific agri reinsurer, agri insurance companies, whereby we can see some growth in the crop portfolio, though health portfolio will be -- the growth will be incremental or minor. It may go down slightly.

[Operator]

[Operator Instructions] As there are no further questions from the participants, I now hand the conference over to the management for closing comments.

[Hitesh Joshi, executive]

So the annual results and the quarterly results that we have presented are broadly in line with the earlier guidances we have been giving from time to time and the trajectory that we have chosen. We will continue to follow the underwriting discipline, the prudent risk management. And we'll continue to see favorable risk-return trade-off. And we remain committed to creating value for our stakeholders.

Thank you all for joining us for this earnings call. Good day and bye.

[Operator]

Thank you. On behalf of General Insurance Corporation of India, that concludes this conference. Thank you for joining us. And you may now disconnect your lines.

[Radhika Ravishekar, executive]

Thank you.