Page 9 - Insurance Times July 2021

reliance on physical meetings was appointments of chief operating officer found during the insolvency process.
higher. and chief marketing officer, Shriram D&O coverage in such cases extended

This resulted in a 2 per cent y-o-y General Insurance expects to re- not only for current actions but also for
decline in business at Rs 71,800 crore energize SGI's channel strategy to give past actions of directors and key
while the private sector reported 8 per partners more midmarket muscle and officials provided it has been purchased
cent y-o-y increase in gross direct enterprise sales commitment. in advance.
premium income to Rs 1.13 lakh crore, On this occasion, Neeraj Prakash, Anup Dhingra, managing director,
said ICRA. managing director, Shriram General Marsh India Insurance Brokers Pvt Ltd,
The health and personal accident Insurance said, "It gives me an was quoted as saying, "Premium tariffs
business saw a growth of 12 per cent immense pleasure to welcome Viswas have already climbed up to a fifth for
in FY21. PSU entities had a muted and Ashish on their new roles. The large D&O buyers having tie-ups with
growth in FY20 at negative 2 per cent board is hopeful that the company can global reinsurers and could rise further
but saw a pick-up in growth during deliver substantial, strategic and as the financial ecosystem assesses the
FY21 at positive 2 per cent. operational progress under their able impact of the pandemic.
The motor insurance segment has leadership." In the wake of the increased liabilities
traditionally been the biggest segment Viswas Srivastava, who takes over as of directors during bankruptcy cases,
for general insurance industry but its the role of COO of Shriram General the demand for D&O cover has risen
share has gradually declined from 46 Insurance, is an accomplished leading to rising in premium rates. The
per cent in FY16 to 37 per cent in Insurance leader and believes in recent bankruptcy cases such as of
FY21. creating value by enabling technology Videocon and Dewan Housing Finance
For FY21, the total motor business had that is focused on outcomes. He is a (DHFL) has shown how directors can
a growth of 2 per cent to Rs 67,800 graduate in Economics & English face significantly increased liabilities.
crore due to Covid-19 lockdowns in Literature from Lucknow University
The Insolvency and Bankruptcy Board
CY2020 and lower new vehicle sales. and holds a Post-Graduation in of India has resolved big cases like
The fire insurance products accounted Business Administration. Essar Steel, Jaypee Infratech, Bhushan
for 11 per cent of the overall gross Steel and Alok Industries. Statistics
direct premium income during FY21. Directors and Officers reveal, as of 31 December out of the
The total premium rose 27 per cent in liability cover become 2,422 cases, while 1,126 were settled
FY21 compared to a growth of 35 per through liquidation, only 317
cent in FY20. costlier as directors' underwent a successful resolution
The growth in FY20 was strong for liabilities rise plan. Experts say a number of cases are
both PSU and private sector players D&O liability cover, which might go up as the country comes out
which increased market share in FY21. of the Covid-19 pandemic.
compensates key administrative
executives of a company against legal Another reason for the rise in demand
Shriram General Insurance action due to their negligence, has has been the modification of the
appoints Viswas become costlier in India due to the Companies Law, say experts. Under
rising number of bankruptcy and the new provisions, key officials can be
Srivastava as COO and financial irregularities cases. The held accountable without any liability
Ashish Goyal as CMO premium rates have gone up by fifth limit.
and can go up further as the impact of
Shriram General Insurance Company D&O covers are designed to cover
the pandemic gets assessed.
(SGI), announces the elevation of defence, including extrajudicial
Viswas Srivastava as chief operating D&O policies cover legal costs along settlements. However, experts say,
officer (COO) and Ashish Goyal as chief with regulatory fines and penalties most companies prefer to settle them
marketing officer (CMO), with a motive which are civil in nature. It has been out of court because of the time
to revitalize its activities in the seen that stakeholders can face involved while going through the court
Insurance sector. With the new regulatory actions if any negligenceis route. T

The Insurance Times, July 2021 9