Page 314 - Motor Insurance Ebook IC 72

The Insurance Times

With the number of risk covers rising, losses have
also mounted, bleeding capital from the private
sector.

Besides, the demand for dismantling the pool
coincided with the downturn in investment earnings
and sharp drop in premium income after the
deregulation of fire and engineering business in 2007.
Investment income in the past had buffered the
underwriting losses for the public sector.

In the event of the pool being dismantled, PSUs favour
minimum quotas for the private sector in third party
commercial vehicle risks.

The pool itself, they said, could be restricted to the
four public sector general insurers. However, even the
proposal for minimum quota on commercial vehicle third
party risks is expected to face resistance from the
private players.

This was in view of the continuing high losses in the
sector and the absence of a free pricing regime for
third party liabilities. Pricing of third party liability is
currently administered. Despite demands for
deregulation, the insurance regulator is yet to take a
decision on the subject.

Website: www.bimabazaar.com Call: 033-22184184 / 40078428 314

Copyright@ The Insurance Times. 09883398055 / 09883380339