Star Health's Second-Quarter Normalised Profit Jumps 70% to ₹390 Crore as the Insurer Posts a ₹99 Crore Underwriting Profit and Its Claims Ratio Falls to 98.0%

Star Health and Allied Insurance, the largest standalone health insurer in India, reported a sharp improvement in its second-quarter results for fiscal year 2027, which covers July to September 2026. The numbers below come from a report by InvestyWise on October 28, 2026, which cites the company's filing with the stock exchange. The primary filing was not reviewed for this article, so readers should check the original before relying on any single figure. The article does not include a loss ratio or a solvency ratio.

Profit: normalised versus reported

The company reports two profit measures. Normalised profit after tax was ₹390 crore in the second quarter, up 70% from ₹229 crore a year earlier. Reported profit after tax was ₹265 crore, compared with ₹80 crore. The gap between the two figures exists because the normalised number adjusts for the effect of changes in the market value of investments. The report says the normalisation assumes an annual yield of 8%. A normalised figure is management's choice of presentation and is not an accounting standard measure, so the reported figure is the one that matches the statutory accounts. Both measures moved strongly upward, which suggests that the improvement does not depend on the adjustment alone.

Underwriting turns profitable

The most important change is in underwriting. The insurer made an underwriting profit of ₹99 crore in the second quarter, against a loss of ₹40 crore in the same quarter last year. Underwriting profit is premium earned minus claims and operating costs, before investment income, so it indicates whether the core insurance business pays for itself. The combined ratio, which the report labels CISR, improved to 98.0% from 100.9%. A ratio under 100% means premiums exceeded claims and expenses. At 98.0%, the margin is thin, but it has moved from the wrong side of 100% to the right side.

Growth

Gross written premium rose 19% to ₹5,275 crore. Within that, fresh premium from retail health, meaning new policies sold to individuals and families, rose 35%. Fresh business growth faster than total growth indicates that sales of new policies are accelerating, although the report does not say how much of the growth is volume and how much is price.

First-half view

For the six months to September, normalised profit after tax was ₹775 crore, up 56% from ₹496 crore. Reported profit after tax was ₹815 crore, up 57% from ₹518 crore. Underwriting profit was ₹210 crore against a loss of ₹24 crore in the first half of the previous year. The report notes that this first-half underwriting profit already exceeds the ₹198 crore the company earned in all of fiscal 2026, which is a useful yardstick of how quickly margins have changed. Gross written premium for the half was ₹9,562 crore, up 19%, with fresh retail health premium up 36%. The first-half combined ratio was 97.9% against 100.3%.

Operating indicators

The report lists several operating measures. The insurer settled 22.5 lakh claims, which is 2.25 million, and its retail claims settlement ratio was 92.4%. Persistency was reported at 102%, up 4%, which is an unusual figure because persistency is normally a ratio at or below 100%; it may reflect a particular method of calculation and should be checked against the filing. The net promoter score was 65, up 4 points, and 97% of fresh policies were sourced digitally.

A conflicting headline

A separate search result carries a headline that Star Health's quarterly net profit fell 54% despite higher revenue. That headline does not match the figures here, and it may relate to a different period, so it has not been used. Readers comparing sources should look at the quarter and year referred to before drawing conclusions.

What to watch

Health insurers in India have been watched for claims inflation, hospital pricing and regulatory changes. The report contains no discussion of these factors, no loss ratio and no solvency data, so it does not explain why the combined ratio improved. Possible drivers, such as price increases, a change in product mix or lower claims, cannot be confirmed from the article. Investors will probably look for management commentary in the earnings call and in the full results.

For policyholders, the main point is that an insurer making an underwriting profit has more room to absorb claims, but profitability does not guarantee that premiums will not rise. For the industry, the improvement suggests that a large player can reach underwriting breakeven in health insurance, a line where several companies have struggled.

Reading the numbers together

Simple arithmetic on the reported figures helps put the quarter in proportion. Second-quarter gross written premium of ₹5,275 crore and first-half premium of ₹9,562 crore imply first-quarter premium of about ₹4,287 crore, so the second quarter was larger, which is consistent with the seasonal pattern of health insurance sales. Normalised profit of ₹390 crore in the quarter and ₹775 crore in the half implies about ₹385 crore in the first quarter, so the improvement in profit was steady across the two quarters. These are the reviewer's calculations from reported totals and are not company disclosures.

The gap between reported and normalised profit also deserves attention. In the second quarter reported profit of ₹265 crore was below the normalised ₹390 crore, while in the first half reported profit of ₹815 crore was above the normalised ₹775 crore. The two measures therefore moved in different directions between the quarter and the half, which shows how much investment valuation changes can affect reported numbers from one period to another.

Limits

This article summarises a secondary report of a company filing. It is not investment advice, and the figures should be checked against the filing on the BSE website.