Go Digit posts 20% rise in Q1 profit amid lower claims, rising premiums
Lower claims payouts and higher premium collections helped Go Digit General Insurance offset a decline in total income.
Go Digit General Insurance reported a 19.7% quarter-on-quarter increase in net profit for the quarter ended June 2025, as lower claims payouts and higher premium collections helped offset a decline in total income.
The company’s profit after tax (PAT) stood at Rs 138.33 crore in Q1 FY26, compared to Rs 115.61 crore in the quarter before that.
Gross premiums written rose 15.7% to Rs 2,981.80 crore from Rs 2,576.38 crore in Q4 FY25. Total income, however, fell 23.7% to Rs 2,179.46 crore from Rs 2,855.18 crore in the previous quarter.
Claims paid during the quarter dropped sharply by a third to Rs 902.53 crore, down from Rs 1,353.61 crore in the previous quarter. The change in outstanding claims—claims incurred but not yet paid—rose 11.8% to Rs 408.80 crore.
Net commission expenses declined 4.4% quarter-on-quarter to Rs 572.07 crore. Employee benefits expense rose 59.3% to Rs 89.94 crore, while other expenses increased 28.9% to Rs 56.41 crore.
Total expenses dropped 15.1% to Rs 2,058.58 crore from Rs 2,426.12 crore last quarter.
In segment-wise performance, motor insurance revenue rose 4.1% sequentially to Rs 1,429.98 crore in Q1 FY26, while the segment continued to post a loss of Rs 232.34 crore, widening from Rs 219.41 crore in the previous quarter.
Revenue from the health group and corporate insurance segment fell 18.7% quarter-on-quarter to Rs 268.54 crore, with the segment swinging to a loss of Rs 22.88 crore from a profit of Rs 21.48 crore in Q4 FY25.
The fire insurance segment emerged as a key profit contributor, recording a profit of Rs 35.38 crore in Q1 FY26 compared to a loss of Rs 67 crore in the previous quarter.
During the earnings call, management attributed the turnaround in the fire segment to a few large corporate accounts acquired as leaders, combined with a cautious retention strategy to avoid concentration risk. Notably, a single claim in FY24 wiped out 25% of its fire premium, so the company reduced exposure to similar high-severity risks this quarter.
Assets under management (AUM) rose to Rs 20,861 crore, up 17.4% year-on-year from Rs 17,773 crore.
Investment income grew to Rs 372 crore in Q1 FY26 from Rs 281 crore in Q1 FY25.
Interestingly, equity allocation as a percentage of total AUM stood at 6.3% in Q1 FY26—up from 2.5% in Q1 FY25, showing a more aggressive stance on equities compared to the same quarter last year.
On the equity investment strategy, the company said, “We feel that taking equity to 10% of the allocation is definitely desirable.” However, it also emphasised the need for caution beyond that threshold: “If the stock market drops by 20-25%, the losses will pass through your solvency… beyond 10%, one will have to hold a lot more capital,” they added.
Digit views equity investments as "cherry on the cake, not the cake itself," emphasising a long-term, risk-balanced approach.
Earlier this year, Go Digit General Insurance invested Rs 30.06 crore to acquire a minority stake in pharmaceutical giant Dr. Reddy’s Laboratories.
The unrealised gains on equity investments contributed Rs 123 crore to total unrealised gains in Q1 FY26. This was a notable increase from Rs 51 crore in Q1 FY25.
The total unrealised gains for the quarter were Rs 244 crore, of which Rs 121 crore came from debt and Rs 123 crore from equity investments.
Go Digit is expanding into liability insurance (D&O, cyber, public liability) and surety bonds. In engineering and project insurance, it focuses on power and infrastructure projects. Fire and marine continue to be core lines, with fire delivering standout growth.
Edited by Kanishk Singh