Page 8 - Insurance Times JUNE 2022
P. 8
AI takes Rs. 60000 crore The report assumes greater signifi- "Transparency is equally important.
cance when occupational hazards to Discontinuing uploading NL40 appears
cover for fleet at Rs. 266
life and property of fishers and fish to be a retrograde step in this era of
crore premium farmers are increasingly on the rise transparency. Whether the FRBs in In-
with the occurrence of frequent ex- dia have provided any significant ad-
Air India, has taken a Rs. 60,800 crore
treme weather events in recent times. vantage to the market as compared to
($8 billion) cover for Air India by pay-
the services rendered by international
ing Rs. 266 crore premium to insur-
ance companies, including Tata AIG Disclosure norms eased for reinsurers who do not have a branch
India is a matter that requires frank
General Insurance.
foreign reinsurance
study and analysis," said former IRDAI
The airline managed to get a better
branches, Lloyd's Whole-time Member KK Srinivasan.
deal as it valued its fleet lower by al-
In a surprise move, IRDAI has relaxed
most $2 billion. According to the new
the disclosure requirements of foreign EV fire incidents 'not a
policy, the airline will not be able to fly
reinsurance branches (FRBs) and
over Russian and Ukraine air space due concern', insurers unlikely
Lloyd's India as part of "rationalisation
to the ongoing war. to hike premiums
of compliance" standards.
The new cover, effective April 1 for a Despite rising incidents of two-wheeler
The regulator said FRBs and Lloyd's
year, will be marginally higher than the electric vehicles (EVs)catching fire,
India are now exempted from disclos-
Rs. 258 crore paid in the last financial General Insurance companies are not
ing financial details and underwriting
year by the airline under its previous planning to increase premiums imme-
performance through NL40 format.
owner, the Indian government, said a diately as claims are still in single dig-
However, according to experts, the
source close to the development. In its. The insurers said they will keep a
latest measures will lead to opaque-
the last financial year, the airline had watch and hoped manufacturers will
ness in the functioning of reinsurance
taken a cover of Rs. 76,000 crore ($10 improve the quality of vehicles.
branches in India.
billion). The policy also includes passen-
The vehicle owner will be eligible for
IRDAI said FRBs and Lloyd's India need
ger liability in case of any mishaps. claims from an insurance company in
not publish the half yearly and annual
Air India has a fleet of 117 aircraft, the event of a two-wheeler EV catch-
revenue account, profit & loss ac-
while Air India Express has a fleet of 24 ing fire, only if he/she has a compre-
count, balance sheet and analytical
narrow body aircraft. hensive motor insurance policy, which
ratios as mandated in the captioned
includes an own damage and a third
circular in the newspapers. "However,
party cover. If one has only a third
Insurance coverage for they may continue to publish a true and
party insurance cover, then insurance
accurate abstract of the various re-
fisheries, aquaculture units companies will not cover the damage
turns for the purpose of publicity on a
to the vehicle because third party in-
abysmal in India voluntary basis pursuant to provisions
surance covers losses to the third party,
Given the low penetration of insurance of Section 25 of the Insurance Act,
not to the vehicle owner.
products in the fisheries sector, the FAO 1938," it said.
"When we look at the overall portfo-
World Review of Capture Fisheries and FRBs and Lloyd's India provide reinsur-
lio, if you have under written some of
Aquaculture 2022 has suggested in- ance support to the direct insurers and
the better EV manufacturers, you
volvement of public and private insur- the insurers do conduct their due dili-
won't see too many claims. In our en-
ance service providers to undertake gence on the FRBs while entering re-
tire portfolio - we have almost 25 per-
proactive measures to turn the tide on insurance contracts with them, IRDAI
cent of the two-wheeler EV market
fisheries and aquaculture insurance in said. "The necessary information on
share - we have seen single-digit
India. financials is also made available
claims. So as of now, we do not see a
With weather playing truant in the fish- through public disclosures on the re- need to increase the pricing because
eries sector, the involvement of insur- spective website of the FRBs. Reinsur- this is within our appetite for losses.
ance service providers should be en- ance business is B2B segment and the But if the numbers become much
couraged for the overall competitive- policyholders do not deal with the larger, we have to look at it," said
ness and efficiency of service delivery reinsurers," it said in a circular to the Bhargav Dasgupta, MD & CEO, ICICI
in the sector. CEOs of insurance companies. Lombard General Insurance.
8 The Insurance Times, June 2022