April 1 is the time for most renewals for large customers and mega policies.
With 10-30 per cent hike in the premia for certain categories of corporate cover, the general insurance industry renewed over Rs 1 trillion 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 Rs 1.23 trillion, 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 per cent. Motor third-party premium has gone up as per Irdai advices,” 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 have seen a price hike like catastrophe risks. 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 PM’s Fasal Beema Yojana, the market has grown significantly by about 25 per cent in 2016-17 and with the sustained momentum for crop insurance coverage, similar growth can be expected in 2017-18 as well, she said.
The industry has been able to increase premia for select segments like property insurance, by 10-15 per cent 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 like 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 new reinsurers from overseas as they are yet to become fully active. Tapan Singhel of Bajaj Allianz General Insurance said renewals by corporates, especially property and group mediclaim continue to be volatile. He said they are hopeful that in the current fiscal, the industry will look at pricing more rationally and work towards creating superior underwriting, service capabilities. “Pricing had seen some unreasonable lowering since
“Pricing had seen some unreasonable lowering since detarrification which was unviable for the industry,” AV Girija Kumar, officiating chairman of United India Insurance said, adding some price correction has already happened.
Reliance General has been able to retain almost all of its clients for the current fiscal too. “We’ve retained almost all of our clients and we are expecting reasonable growth in premium in the current fiscal,” Rakesh Jain, Reliance General chief executive said. Liberty Videocon has seen prices going up by 5-15 per cent, its CEO Roopam Asthana said.