RoCE (Return on capital employed) has been fluctuating over the period 2011-2021 due to the following reasons: deteriorating claims ratios in Personal lines, effect of natural disasters over the past 5-6 years and effect of accumulations in individual portfolios. Though they have been compensated to some extent by limited increase in Motor TP rates and rise in investment incomes, the return on capital employed measured (by Profit after tax/Capital & Free Reserves) was only 4.3% in 2020-21 as compared to 1.4% in 2011-12. This reflects the competitive environment in which the Indian Non-life industry operates.
Return on Capital Employed - 10- Year Trend
Source: Council Compilation as per source
data submitted by companies