Gross Written PremiumGWP
The headline top line — all the premium an insurer contracts to collect in a year, before a rupee is ceded or earned.
Why you care
GWP is the number the whole industry quotes: "we grew 18% this year." It's the total premium contracted, before reinsurance and before it's earned. It sizes the business, and it's the first thing a press release leads with. But on its own it tells you nothing about profit.
Run the numbers
An insurer writes ₹120 crore of GWP in a year (illustrative). That's the gross figure. Cede a slice to reinsurers, set aside the part of the year's risk not yet run off, and only about ₹100 crore is premium it has actually earned.
Where this goes
The chain starts here: GWP → net earned premium is what strips the gross number down to real revenue. And the quality of that premium — whether it was priced to make money — is decided by underwriting, not by how big GWP looks.
Why you care
Gross Written Premium (GWP) is the total premium an insurer has contracted to receive on all the policies it wrote in a period. It's gross of reinsurance and before any adjustment for the unexpired part of the risk. It is the industry's headline top line.
Every insurer's results deck opens with it, and every trade-press story leads with its growth rate. That makes GWP the easiest number to over-read. A general insurer can grow GWP 25% in a year by slashing prices and writing risks nobody else wants, and look like a star until the claims land. Premium is the volume of business, not the quality of it. For anyone selling or underwriting policies, the useful instinct is to treat GWP as the question, not the answer: we wrote a lot of premium, but was it good premium?
Run the numbers
Take an insurer that contracts ₹120 crore of premium across motor, health and property in a year. That ₹120 crore is its GWP.
But GWP is not revenue. Two things sit between it and the money the insurer actually gets to keep and earn:
- Reinsurance ceded. The insurer passes part of the risk (and part of the premium) to reinsurers, including the mandatory cession to GIC Re. Say ₹15 crore of premium goes out the door as cession.
- Unexpired risk. A policy sold on 1 January is only half "earned" by 30 June — the insurer is still on the hook for the rest of the year. The portion covering the future is held back as the unearned premium reserve.
Net the cession and the unexpired portion, and roughly ₹100 crore is net earned premium — the number the rest of the P&L is actually built on. GWP ₹120 crore, NEP ₹100 crore: same book, very different figures.
Where this goes
GWP is the mouth of the funnel. The single most important move from here is to net earned premium, because that is the base every ratio in the map divides into. GWP also raises, but does not answer, the question of quality: whether the premium was written at rates that cover the claims to come. That is the job of underwriting and of rate adequacy — and the difference between an insurer that grows GWP profitably and one that simply buys market share.