GICs investment income from an investment of over Rs 8,000 crore has nosedived to Rs 578 crore in 2002-03 from Rs 668 crore recorded in 2001-02. Its total asset has crossed over Rs 11,500 crore in 2002-03.
In Tie-up With LIC For Reinsurance Profit-sharing
Our Banking Bureau
Mumbai, Sept 22: In a unique arrangement, the GIC has worked out a profit sharing deal with LIC for the reinsurance business between the two.
It has opted for a higher provisioning of Rs 114 (Rs 112 crore) in 2002-03. GIC, which is considered as a leading reinsurer in Afro-Asian region, is targeting a Rs 3,400 crore of premium during the current fiscal. It is providing adequate vertical capacity to the Indian companies from whom it receives 20 per cent of reinsurance business to cover large Indian risks in fire and engineering and marine. At present, we are trying to develop more capacity in liability class, said a top GIC official. The terrorism pool of the domestic general insurance industry with a total current corpus of Rs 180 crore managed by GIC has done extremely well and has provided the needed capacity to the Indian market at a time when it was most needed while most of the companies in the rest of the world are finding it difficult to provide this cover. The outgo from this pool has been to the tune of only Rs 12 crore during 2002-03.
GIC believes that two years after 9/11, there are signs of softening and expects that in 2004 renewals, barring unforeseen events, there would again be a huge capacity chasing premiums and insurance companies with good loss records may be able to purchase their protection at a reasonable cost. The official reinsurer of the country with A (excellent) rating from AM Best which is functioning as an exclusive reinsurer for last two years is a leader for the reinsurance programmes of several insurance companies in neighbouring SAARC countries as also insurers in south-East Asia, the middle-East and Africa.
It has opened representative office in UK and Russia also has associate companies in Singapore and Kenya.