Page 8 - Insurance Times September 2020

"With every year taking kharif and rabi Ashish Agarwal, Head, Agriculture 13,139.63 crore, compared to Rs
together, the premium will be set at Business and CSC, Bajaj Allianz General 12,445.83 crore in the same period a
an actuarial rate with some discount. Insurance, said: "As of now, our expe- year ago.
But the loss ratio is set at 110 per rience has been good. We have been
State-owned general insurers saw their
cent. Beyond that it would be for the able to do sustainable business within premiums decline 0.5 per cent in Au-
State to pay. Losses are often exagger- the premium. Last year, due to heavy gust 2020 to Rs 4,690.92 crore com-
ated. AIC is not looking at a profit. If rainfall in Maharashtra and MP, we
pared to Rs 4,714.42 crore in August
the loss ratio is less than 80 per cent, incurred losses but on a portfolio ba- last year. Private general insurers' pre-
it will refund the money to the State," sis, it has been doing reasonably well.
miums for the reporting month rose
he added. However, it can be a volatile business almost 10 per cent to Rs 8,448.83
Insurers also point out that high pre- and one has to be very careful while crore.
mium is just one of the issues due to participating to make sure it is sustain- The biggest gainer in premiums has
which States have exited the PMFBY able in the long run." been standalone health insurers, as
and said many had left due to internal Another insurer said the new guide- they saw a 36.42 per cent rise in pre-
issues such as political compulsions or lines are good and are based on feed- miums during the period to Rs
financial issues.
back from the ground and require- 1,462.92 crore, against Rs 1,072.32
"For Gujarat, high premium was the ments of farmers. "The premium has crore.
reason for exiting the scheme but oth- to be charged to keep the scheme sus-
This is driven by the fact that demand
ers like Bihar and Jharkhand had left tainable in the long run. There is also for health insurance has been on the
due to inability to pay or internal is- a focus on timely payment of claims, rise due to the ongoing coronavirus
sues," said two insurers who did not deployment of resources on the ground (Covid-19) pandemic. Also, the
wish to be named. Telangana and level and adoption of technology," he regulator's drive to nudge insurers to
Andhra Pradesh have left for other said.
sell standardised health products has
reasons, they added. Under the new guidelines introduced done the trick as there is huge demand
With high volatility in the segment, a by the Centre in February this year, it for the Corona Kavach and Corona
large number of private insurance is optional for loanee farmers to join Rakshak policies. These schemes were
companies too have exited the the scheme and business is allocated launched specifically to provide protec-
scheme, including ICICI Lombard Gen- to insurers for a period of three years. tion against the virus.
eral Insurance and Tata AIG, but play- For kharif 2020, a total of 11 insurance Despite good growth in premiums in
ers say that the new guidelines allow
companies have participated in PMFBY August, cumulative premiums col-
for better rates and are based on an with as many as 1.37 crore farmers lected in the April-August period of
actuarial basis.
insured. FY21 were mostly flat. Premiums of
Satyajit Tripathy, General Manager, non-life insurers grew 3.58 per cent to
General Insurance Corporation of In- Non-life insurers see 10% Rs 73,965 crore in that period. Gen-
dia, said: "The scheme is doing quite eral insurers also saw flat growth with
well. It is running on actuarial basis and rise in August premiums premiums at Rs 62,669.21 crore in the
rating and everything is much im- Non-life insurers, which include general April-August period, up 0.02 per cent.
proved now. Rates are improved and insurers, standalone health insurers This is due to a fall in motor segment
field deployment of resources is good, and specialised PSU insurers, have premiums and no hike in motor third-
adoption of technology is being done seen a 10.38 per cent growth in pre- party premiums.
quickly by States, the Centre and the miums in August. Standalone health insurers saw 25.85
companies. The structure of the They have amassed premiums to the per cent growth in the same period,
scheme has improved a lot and is tune of Rs 17,623.25 crore in August indicating high demand for health in-
mostly run on commercial lines." compared to Rs 15,964.74 crore in the surance. In fact, the health segment
It is expected that more States and same period a year ago. for general insurers has become the
insurers will rejoin the scheme on see- General insurers - 25 in total - have biggest line of business, overtaking the
ing the improved results from the end seen their premium collection go up motor insurance segment. And, ex-
of kharif and rabi season this year. 5.57 per cent in August 2020 to Rs perts are estimating that by the year
The Insurance Times, September 2020 7