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IRDAI data · March 2025

Insurer Solvency Ratios in India

How much capital each Indian insurer holds against what its liabilities are expected to need. IRDAI requires a minimum of 1.50 and publishes the figure every quarter. This page carries the full quarterly series back to March 2015, so you can see not just who is below the floor but for how long.

Written by Parul Bhargava · Founder and Principal Advisor, advising since 2004

Public sector general insurers

Three of the four have been below the regulatory floor for years. The quarter each fell below it is shown.

Private general insurers

Ratio at March 2025, with the change over the year.

Standalone health insurers

Ratio at March 2025, with the change over the year.

Life insurers

Ratio at March 2025. Every life insurer is above the floor.

What the floor actually means

The required solvency margin is a regulatory estimate of the capital an insurer needs to meet its obligations. The available solvency margin is what it actually holds. A ratio of 1.50 means holding half as much again as that estimate, and it is a floor rather than a target.

Falling below it does not suspend an insurer's licence or stop it paying claims. It obliges the insurer to file a plan with IRDAI and restore the position, and it constrains how much new business it can prudently write. What it signals to a buyer is thinner margin for error.

The public sector position, stated plainly

Three of the four public sector general insurers report negative solvency at March 2025, meaning measured liabilities exceed admissible assets. This is not new and it is not a rounding artefact: it is the outcome of sustained underwriting losses without matching capital. The rating agency ICRA put the three at around minus 0.85 in December 2024 and estimated they need roughly 152 to 170 billion rupees of fresh capital to reach 1.50.

Two things follow, and both matter. These are government-owned insurers that continue to pay claims, and they carry an implicit expectation of state support, so this is not a reason to treat existing policies as worthless. But on a large property programme, or a liability policy that may be claimed against in a decade, the strength of the balance sheet behind the promise is a legitimate part of the decision. New India Assurance, the fourth, is comfortably above the floor and has never been below it in the period covered here.

Underwriting: almost nobody makes money on the policy itself

Underwriting profit or loss for FY2024-25, as a share of net earned premium. Insurers earning under 500 crore are omitted, because the ratio swings wildly on a small book.

31 of the 34 general and health insurers reporting lost money on underwriting in FY2024-25. Across all of them the industry lost 30,276 crore on 227,538 crore of earned premium, a margin of -13.3 per cent. Insurers make that back on investment income, which is how the model works, but it explains a great deal that otherwise looks arbitrary.

It is why renewal premiums harden across the market at the same time, why claims get scrutinised harder in a bad year, and why the cheapest quote on a schedule is often the one that argues hardest later. An insurer already losing money on a line has nowhere to absorb a large claim except its reserves.

IRDAI Handbook on Indian Insurance Statistics 2024-25, Table 45. Underwriting profit or loss is net earned premium less net claims incurred, less commission and expenses of management, less any premium deficiency. It excludes investment income.

How to use this when placing cover

Solvency belongs in the same conversation as price and wording, not ahead of them. On a small, short-tail policy it rarely decides anything. It earns real weight in three situations: a sum insured large enough that one loss would matter to the insurer, a long-tail liability line where the claim may arrive years after the premium, and any programme where you are being offered a noticeably cheaper rate than the market and want to understand why.

Read the trend as well as the level. The quarterly series above exists precisely because a single annual reading hides the direction.

Frequently asked questions

Related: insurer claim-settlement ratios · complaint rates by insurer · Ombudsman outcomes · how we source and check figures: editorial standards.