Page 8 - Insurance Times July 2024

delays remain a concern, though there costs, player-related expenses, and cent increase in farmer enrolment
could be a buffer in terms of a reserve event cancellations. from 2022-23, with 42 per cent of non-
day for rescheduling. "Insurance claims "This is the first time in five years that loanee farmers and 41 per cent of en-
have begun to emerge due to three the insurance industry is seeing claims rolled farmers (56.80 crore) indemni-
completely washed-out matches and in IPL due to cancellations, with the last fied from 2016-17 to 2023-24.
partial washouts," a person said. "Also, instance occurring in 2019," said Despite the phenomenal growth, the
there are claims for player injuries."
Pranav Shah, director - speciality lines, penetration and density of PMFBY and
The sharp rise in claims is expected to Alliance Insurance Brokers. "Several restructured weather-based crop in-
lead to higher insurance premiums for stakeholders, including broadcasters, surance (RWBCIS) programmes are
next year's edition of IPL. "These claims franchise owners, and sponsors, are significantly low.
will have an impact on the premium of filing their claims, which could be over Their penetration in terms of gross
policies next year," the person said. Rs 120 crore." premium as a percentage of GDP is

Sponsors, broadcasters, team spon- 0.62 per cent, and insurance density or
sors, and franchise owners have filed PMFBY is the third largest per capita farmer premium is only Rs.
claims to recover some of their rev- 2,148. Further, the few insurers run-
enue losses from the washed-out crop insurance programme ning crop insurance programmes indi-
matches. globally cate attendant and social equity prob-
IPL's market value per match typically The Press Information Bureau (PIB) lems for insured farmers.
ranges between Rs 100 crore and Rs recently disclosed that Pradhan Mantri
How can the quality and efficacy of
125 crore. The tournament's insurance Fasal Bima Yojana (PMFBY) is the third
insurance service delivery, institutional
policy covers a wide range of expenses largest crop insurance programme glo- capacity of programme implementa-
including match revenue, broadcasting bally. The scheme witnessed a 27 per
tion, inclusion, and regulatory over-
sight be improved?
Non-life insurers post 15.5% increase in May First, a performance analysis of PMFBY
premium and RWBCIS from 2016-17 to 2023-24
shows that while there was an uptick
Non-life insurers posted 15.47 per cent year-on-year (Y-o-Y) growth in gross
direct premium underwritten to Rs 20,822.29 crore in May 2024, latest in farmer enrolment, with a 10 per
data released by the General Insurance Council showed. The premium of cent CAGR, the area and sum insured
general insurers grew by 14.05 per cent Y-o-Y to Rs 18,170.64 crore. exhibited a negative CAGR of 8.4 per
cent and 5.1 per cent, respectively.
Public sector general insurers clocked 7.28 per growth in premium to Rs
The claims payout recorded a 5 per
6,696.24 crore, whereas private counterparts witnessed 18.4 per cent im-
cent CAGR, indicating an uptrend from
provement to Rs 11,474.4 crore. Among the companies, industry leader New 2022-23.
India Assurance Company saw a marginal drop of 0.67 per cent in premium
to Rs 2,404.34 crore. Farmers' share in gross premium was
15 per cent, exhibiting a negative 4.3
The premium of leading private sector players like ICICI Lombard General
Insurance grew by 21.64 per cent to Rs 2,104.51 crore. And, Bajaj Allianz per cent CAGR. Insurers settled more
General Insurance's premium increased by 9.26 per cent to Rs 1,093.23 than 94 per cent of total claims with a
crore during the time period. Among other key insurers, the premium of 70 per cent claim-to-premium ratio.
HDFC Ergo General Insurance dropped by 4.76 per cent to Rs 969.98 crore Second, while PMFBY has been skewed
towards loanee farmers (over 50 per
United India Insurance Company's premium rose by 15.75 per cent to Rs
1,696.05 crore and Oriental Insurance's premium rose to Rs 1,601.09 crore, cent), RWBCIS is limited to resource-
endowed male farmers, and their en-
up 15.75 per cent from the year-ago period.
rolment and premium payments are
In terms of market share, public sector general insurers took 33.82 per cent insignificant compared to PMFBY.
of the overall insurance industry in May 2024 against 36.45 per cent in May
2023. The private insurers, on the other hand, witnessed an increase to Third, higher transaction costs of ser-
55.67 per cent in the reported month. This compares to 53.92 per cent in vice delivery for small farmers, lack of
the year-ago period. coordination between insurers, banks

8 July 2024 The Insurance Times