General Insurers begin New Fiscal on a Strong Note

With 10-30% hike in the premia for certain categories of corporate covers, the general insurance industry renewed over 1 lakh crore worth of policies on April 1. April 1 is the time for most renewals for large customers and mega policies.

The industry closed 2016-17 at 1.23 lakh crore, up from around Rs. 96,000 crore in 2015-16.“Fire and group health insurance premia have gone up by an average of 10-30%. Motor third-party premium has gone up as per IRDAI advice,” G Srinivasan, Chairman and Managing Director of New India Assurance, told PTI. State-owned domestic reinsurer GIC Re also had a productive April 1 renewal season in the new fiscal. By and large, it has been able to maintain its market share by meeting half of the reinsurance needs of the domestic market.

“Some segments, such as catastrophe risks, have seen price hikes. Pricing is driven by experience of the accounts and the underlying exposures,” Alice Vaidyan, GIC Re Chairperson, said, adding, “Accounts with consistent losses have seen some premia increases across risk and catastrophe cover.”Driven by the PM’s Fasal Bima Yojana, the market has grown by a significant 25% in 2016-17 and with the sustained momentum for crop insurance coverage, similar growth can be expected in 2017-18 as well, she said.For select segments like property insurance, the industry has been able to increase premia by 10-15% due to firming up of prices.

National Insurance has been able to secure all the renewals, its Chairman Sanath Kumar said, adding that they have been able to re-price group health insurance and hike some property policies where there have been frequent losses. According to Kumar, prices have been flat across the base in some industrial segments, such as power and chemicals, while loss-based revision has happened in certain others. GIC Re continues to be the bulwark of support for non-life insurance business, Kumar said, and observed that so far foreign reinsurers have not been aggressive. Agreeing with Kumar, Srinivasan said it is early days for the new reinsurers from overseas as they are yet to get fully active.