The Orissa High Court has directed the Central Bureau of Investigation (CBI) to reinvestigate a series of fraudulent motor accident claims involving vehicles insured with ICICI Lombard General Insurance Company . This development comes amidst the company's efforts to maintain transparency and address financial discrepancies.

Scope of the Investigation

The case involves 34 Motor Accident Claim Tribunal cases stemming from 29 alleged road traffic accidents. The total compensation claims amount to approximately Rs 5.00 crore, highlighting the significant financial implications of the fraud.

ICICI Lombard's Internal Findings

ICICI Lombard's internal investigation uncovered several serious irregularities:

• Vehicle implanting in accidents
• The same driver appearing in multiple accidents
• Manipulation of medical records

These findings prompted the company to report the matter to the Crime Branch and seek a stay on tribunal proceedings through the High Court.

Legal Proceedings

The Crime Branch confirmed the irregularities in their affidavit to the court. Given the scale and complexity of the fraudulent claims, the High Court has assigned the CBI to handle the reinvestigation.

Company's Financial Performance

While dealing with these legal challenges, ICICI Lombard continues to maintain strong financial performance. According to the company's recent investor presentation:

• Gross Written Premium (GWP) stood at Rs 151.11 billion
• Profit After Tax (PAT) was Rs 15.67 billion, showing a growth of 22.9%
• The company's Combined Ratio (CoR) was 104.0% on a 1/n basis

Transparency Measures

In line with its commitment to transparency, ICICI Lombard recently issued a clarification regarding an increase in trading volume of its securities. The company stated that it has made all necessary disclosures as per SEBI regulations and attributes the volume increase to market-driven factors.

Additionally, the company acknowledged and corrected typographical errors in its investor presentation, demonstrating its commitment to accurate reporting.

Market Position

Despite the ongoing investigation, ICICI Lombard maintains a strong market position:

• Holds an industry-leading position with a 10.4% market share
• Experienced growth in new private car business (17.8%) and two-wheeler business (8.5%), outpacing industry growth

As the CBI probe unfolds, ICICI Lombard's handling of this situation will be crucial for maintaining investor confidence and its market standing in the competitive insurance sector.

ICICI Lombard General Insurance Company has announced ambitious targets for return on equity (ROE) and key business segments, signaling confidence in its growth strategy amid a robust financial performance in the second quarter.

ROE and Loss Ratio Targets

The management of ICICI Lombard has set a return on equity target of 18-20%, demonstrating a strong commitment to shareholder value. Additionally, the company aims to maintain retail health indemnity loss ratios at 65-70% and motor business loss ratios at 65-67%, indicating a focus on profitability in these crucial segments.

Q2 Financial Highlights

ICICI Lombard's financial results for Q2 showcase the company's resilience and growth:

• Profit After Tax (PAT) grew by 18.1% to ₹820.00 crore, up from ₹694.00 crore in the same quarter of the previous year.
• Gross Direct Premium Income (GDPI) stood at ₹6,596.00 crore, reflecting a slight decrease of 1.9% year-on-year.
• Combined ratio was at 105.1%, compared to 104.5% in the corresponding quarter of the previous year.

Key Performance Metrics

Growth Outlook

Management anticipates better growth in the second half, citing recent changes and positive trends discussed during their conference call. This optimistic outlook aligns with the company's strategic targets and suggests potential for improved performance in the coming quarters.

Dividend Announcement

In a move that further underscores the company's strong financial position, ICICI Lombard's Board of Directors has declared an interim dividend of ₹6.50 per equity share for H1, an increase from ₹5.50 per share for H1 of the previous year.

Conclusion

ICICI Lombard's ambitious ROE target and strong Q2 performance demonstrate the company's commitment to growth and profitability. As the company navigates the evolving insurance landscape, investors and industry observers will be keen to see how these targets translate into long-term value creation.