Niva Bupa Health Insurance continues to maintain strong capitalisation despite recording underwriting losses, according to AM Best. The rating agency expects the insurer’s risk-adjusted capitalisation to remain at its strongest level, supported by internal capital generation and retained earnings.
AM Best assigned Niva Bupa a Financial Strength Rating of A- (Excellent) and an India National Scale Rating of aaa.IN (Exceptional) on September 17, 2026. The outlook for both ratings remains stable.
Investment Returns Support Niva Bupa Earnings
Niva Bupa has reported positive operating earnings for four consecutive financial years through FY2026. Strong investment returns have helped offset underwriting losses during this period.
The insurer also improved its underwriting performance in recent years. AM Best attributed much of the improvement to a lower expense ratio as Niva Bupa expanded its operating scale. However, the company still reported a combined ratio above 100% in FY2026.
Niva Bupa recorded a 102% combined ratio on a net/net basis under IFRS 17 during FY2026. It also reported a 10.7% return on equity (ROE) for the year.
A combined ratio above 100% indicates that claims and operating expenses exceeded net earned premium from underwriting activities. Investment income therefore remains an important contributor to the insurer’s overall earnings.
Strong Capital Supports Health Insurance Growth
AM Best said Niva Bupa’s balance sheet strength benefits from its strongest Best’s Capital Adequacy Ratio (BCAR) level at the end of FY2026. The agency expects the insurer to maintain this position as it generates capital internally and retains earnings.
The insurer also has financial flexibility through shareholder capital contributions and access to capital markets for debt issuance. Its investment portfolio carries relatively low risk, with most assets allocated to fixed-income securities with good credit quality.
Niva Bupa holds a solid position in India’s standalone health insurance market and ranks third in the segment, according to AM Best. The insurer also has a strong presence in retail health insurance, supported by diversified distribution channels and digital capabilities.
The rating agency also considers Niva Bupa’s relationship with majority shareholder Bupa Group when assessing its financial strength. The company benefits from access to shared resources and services across several business functions.
For Niva Bupa, the latest assessment highlights the importance of improving underwriting results while maintaining sufficient capital to support its expanding health insurance operations.
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