Star Health Reports 99.6% Drop In March Quarter PAT On Widening Underwriting Loss

Star Health and Allied Insurance Co. Ltd. on Tuesday reported a sharp decline in its net profit for January-March, with the underwriting loss widening during the period. In the final quarter of 2024-25, the insurer's profit after tax slumped to just ₹5.1 million, down 99.6% from ₹1.42 billion a year ago.

While Kotak Institutional Equities had predicted a loss of ₹30 million for the quarter ended March, Motilal Oswal Financial Services and YES Securities had forecast a net profit of ₹1.20 billion and ₹1.51 billion, respectively.

In January-March, Star Health's net premium earned rose 12% on year to ₹37.98 billion, total expenditure increased 17% to ₹40.73 billion, driven by a 16% rise in net commissions to ₹7.60 billion and a 14% increase in claims paid to ₹26.55 billion. As a result, the underwriting loss, which is the difference between net premium earned and total expenses, grew to ₹2.75 billion from ₹918.4 million in the same quarter last year. The underwriting loss in October-December stood at ₹489.7 million.

For 2024-25 as a whole, Star Health's net profit fell 24% to ₹6.46 billion, while net premium earned rose 15% to ₹148.22 billion. The underwriting loss for the full year was ₹3.78 billion, compared to a profit of ₹893.2 million in 2023-24.