Operating Performance Highlights

Gross Written Premium (GWP):

  • Q2 FY27 GWP increased 19% YoY to ₹5,275 crore (1/n basis)
  • H1 FY27 GWP increased 19% YoY to ₹9,562 crore (1/n basis)

Fresh Retail Health Business:

  • Q2 FY27 fresh retail health GWP grew 35% YoY (1/n basis)
  • H1 FY27 fresh retail health GWP grew 36% YoY (1/n basis)
  • New-to-insurance mix improved to 93% in Q2 from 89% in Q2 FY26
  • Number of new-to-insurance policies grew over 10% YoY
  • Average sum insured rose 13% YoY

Underwriting Performance:

  • Q2 FY27 underwriting result: ₹99 crore profit (vs. ₹40 crore loss in Q2 FY26) - positive swing of ₹139 crore
  • H1 FY27 underwriting result: ₹210 crore profit (vs. ₹24 crore loss in H1 FY26) - positive swing of ₹234 crore
  • H1 FY27 underwriting result exceeded full-year FY26 underwriting result of ₹198 crore
  • Combined Insurance Service Ratio (CISR) improved by 2.9% to 98% in Q2 FY27
  • CISR improved by 2.4% to 97.9% for H1 FY27
  • Fifth consecutive quarter of improvement in loss ratios and underwriting results

Profitability Metrics:

  • Q2 FY27 PAT increased 231% YoY to ₹265 crore (from ₹80 crore in Q2 FY26)
  • H1 FY27 PAT increased 57% YoY to ₹815 crore
  • Normalized PAT (pegged at normalized annual investment yield of 8%):
  • Q2 FY27: ₹390 crore (70% YoY increase)
  • H1 FY27: ₹775 crore (56% YoY increase)
  • Normalized ROE (annualized) improved from 11.2% in H1 FY26 to 15.1% in H1 FY27

Business and Market Position

Market Share:

  • Retail Health market share: 29% for H1 FY27 and 30% for Q2 FY27
  • Market share continues to be influenced by share of long-term policies and 1/n reporting
  • Estimated new-to-insurance market share closer to 40%

Distribution Channels:

  • Proprietary channels (agency and digital D2C) contributed over 90% of retail business
  • Agency network: Added 39,000 new agents during H1 FY27, taking total to 8.7 lakh agents
  • Agency productivity improved 19% YoY during H1
  • Fresh business growth from semi-urban and rural geographies at over 3 times metro/urban growth
  • Digital D2C channel grew 137% YoY in H1, with superior combined ratios
  • D2C share increased from 8% to 13% of overall business

Customer Metrics:

  • Retail claim settlement ratio improved by over 1% to 92.4% for H1 FY27
  • Renewal ratio improved by 4% to 102%
  • Company-level NPS improved by 4 points to 65 as of September 2026
  • Settled 22.5 lakh claims during H1 FY27
  • 83% of claims settled on cashless mode (claimed as highest in industry)

Digital and Technology Initiatives

Platform Upgrades:

  • Upgraded core customer relationship management platform to Salesforce
  • Scaled deployment of AI bots across customer acquisition and service channels
  • AI bots processed over 7.5 million minutes of call volume at <20% cost of human deployment
  • AI-driven quality assurance analyzed over 10 million minutes of customer interaction across 9 languages
  • Service bots autonomously resolved over 1,000 customer interactions per day
  • ATOM Pro platform utilized by more than 50% of active agents

Analytics and Fraud Prevention:

  • Partnership with Amplify Health went live with automation of FWA (Fraud, Waste, and Abuse) capabilities
  • Enhanced detection of fraud across billing, tariff, and medical necessity parameters

Investment Portfolio Strategy

Asset Allocation:

  • Equity allocation: slightly less than 14% with cap at 15%
  • REITs and InVITs: fully invested within regulatory limit of 3%
  • AIF exposure: approximately 2.1-2.2% of funds
  • Increased portfolio duration to approximately 4 years given rising G-Sec yields
  • No incremental equity purchases in Q2, but may consider if markets become attractive
  • Equity investments primarily through index funds/ETFs with sector biases
  • Debt portfolio classified as held to maturity (not FVTPL)

Investment Performance:

  • ₹59 crore investment-related loss reported (breakdown not provided)
  • Equity, ETF, REITs, and InVITs classified as FVTPL under IFRS

Regulatory Developments and Response

IRDAI Consultation Paper (Recalibrating Economics of Insurance Distribution):

  • Company has submitted views to authority
  • Welcomes direction of proposed reforms and supports intent of better customer outcomes
  • Believes framework aligns with Star Health's distribution model built over 2 decades
  • Over 90% of retail business sourced through proprietary channels
  • Individual agents remain better rewarded under proposed framework
  • Internal estimates indicate credible path to proposed expense of management limits
  • Committed to maintaining compliance with EOM requirements
  • Awaiting final regulations

Public Insurance Registry (PIR):

  • Welcomed as digital public infrastructure for insurance
  • Expected to reduce information asymmetry, strengthen underwriting controls, simplify claims processing, and strengthen fraud detection

Accounting Treatment Change

Insurance Finance Charges:

  • Discontinued practice of recognition of insurance finance charges from current quarter
  • Previous periods restated for comparability
  • No impact on profitability metrics (PAT and underwriting results)
  • Insurance finance expenses will be zero going forward
  • Corresponding income was part of insurance revenue which has been restated

Outlook and Strategy

H2 FY27 Outlook:

  • Expects moderation in headline growth rates as GST-led growth becomes part of base
  • Aspires to maintain 20%+ growth on fresh business consistently
  • Underwriting performance anchored in strength of vintage book (80% of portfolio)
  • Growing share of multi-year policies provides visibility and stability to earned revenue base
  • Focus on expanding market through new-to-insurance customers (over 90% of fresh customers)

Growth Drivers:

  • Continued agent addition and distribution network expansion
  • Deepening presence in semi-urban and rural markets
  • Scaling D2C channel among younger customers and salaried professionals
  • Focus on sub-40 consumers through products like Young Star neo

Q&A Session Highlights

Product Pricing:

  • Over 35 health insurance plans catering to different segments
  • 80% of book repriced in last cycle, remaining 20% being addressed this year
  • No immediate plans for price changes awaiting regulatory clarity

Loss Ratio Improvement:

  • Improvement driven by retail loss ratios (group makes small portion)
  • Renewal book operating at less than 100% combined ratio
  • Home healthcare and telemedicine services: over 1 lakh consultations and home care services in Q2
  • Contributing to medical frequency management

Multi-Year Policies:

  • Approximately 50% of fresh business consists of multi-year policies
  • Commission treatment: For certain agents, paid upfront (IGAAP), deferred over policy period (IFRS)
  • Awaiting clarification on whether subsequent years will be considered fresh or renewal for distribution regulations

Hospital Negotiations:

  • Approximately 80% of claims come from packages
  • Ongoing business-as-usual negotiations with hospitals
  • Supreme Court verdict on drug pricing not yet notified, impact uncertain

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