AM Best Affirms Credit Ratings of ICICI Lombard General Insurance Company Limited

SINGAPORE--(BUSINESS WIRE)--AM Best has affirmed the Financial Strength Rating of B++ (Good), the Long-Term Issuer Credit Rating of “bbb+” (Good) and the India National Scale Rating (NSR) of aaa.IN (Exceptional) of ICICI Lombard General Insurance Company Limited (ICICI Lombard) (India). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect ICICI Lombard’s balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, neutral business profile and appropriate enterprise risk management. The ratings also factor in a neutral impact from ICICI Bank Limited (ICICI Bank), one of the largest private sector banks in India.

ICICI Lombard’s balance sheet strength is underpinned by its risk-adjusted capitalisation, which is expected to remain at the strongest level over the medium term, as measured by Best’s Capital Adequacy Ratio (BCAR). In addition, AM Best views the company as having strong financial flexibility as demonstrated by its track record of capital-raising activities. ICICI Lombard has a moderate-risk investment portfolio, which includes exposure to higher-risk investments, such as equities and fixed-income securities that are not rated on an international rating scale.

AM Best views ICICI Lombard’s operating performance as strong, with a five-year average return-on-equity ratio of 17.6% (fiscal years 2020-2024). The company’s investment income, including capital gains on equity investments, remained a key contributor of overall earnings to offset underwriting losses. Despite its lack of underwriting profitability, ICICI Lombard has consistently outperformed India’s general insurance market. Underwriting performance showed a slight improvement in fiscal year 2024, mainly due to lower claims for motor and health insurance, although the expense ratio was higher. Ongoing portfolio remediation measures have also supported an improvement in the company’s underwriting margins in the first nine months of fiscal year 2025.

ICICI Lombard is the second-largest non-life general insurer in India, with an overall market share of 8.6% based on gross domestic premium income in fiscal year 2024. The company holds market-leading positions in major business lines, including marine cargo, liability and motor business, and ranks second in both the fire and engineering business lines. The company’s underwriting portfolio is well diversified by lines of business and distribution channels with premiums generated predominantly in India. ICICI Lombard is anticipated to enhance its underwriting risk selection through the adoption of technology and analytics; however, persistent market competition may still pose challenges to its technical margins.

Ratings are communicated to rated entities prior to publication. Unless stated otherwise, the ratings were not amended subsequent to that communication.

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AM Best is a global credit rating agency, news publisher and data analytics provider specialising in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

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