Niva Bupa Health Insurance Co. aims to reduce its combined ratio to a range of 95-96% within the next two to three years, reported its Managing Director and Chief Executive Officer, Krishnan Ramachandran. The combined ratio is a key performance indicator (KPI) for insurance companies, measuring their profitability and financial stability. A combined ratio below 100 indicates profitability, while a ratio above 100 indicates lower profitability.
In the October-December quarter, Niva Bupa’s combined ratio stood at 96.3%, and for the nine months ending December 31, 2024, it was at 100.9%. The company’s financial performance for FY24 saw a combined ratio of 98.8%, with a target to achieve a steady state trajectory of 95-96% in the next two to three years.
To achieve this target, the company is working on improving its operational efficiency, underwriting, and claims management. Experts consider a combined ratio of 95-96% as a good indicator of an insurance company’s financial stability and profitability. Achieving such a ratio would demonstrate Niva Bupa’s commitment to maintaining a healthy balance between its expenses and premium income, ensuring long-term sustainability and growth.
Raising the bar to 95-96% would not only benefit the company but also its policyholders, as it would lead to more effective risk management, better claim settlements, and enhanced customer satisfaction. It is reassuring to see Niva Bupa’s commitment to striving for excellence, evident in its clear goal-setting and plans to improve its performance. With a combined ratio of 95-96%, Niva Bupa is expected to maintain its competitiveness in the market, increase customer trust, and ensure a strong financial foundation for the years to come.