Page 7 - Insurance Times May 2020

General Insurance

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General insurance indus- "This was however lower than the Further, not increasing the premium
51.5% growth demonstrated in April rates for motor third party liability in-
try will witness slow 2019. These policies are subscribed by surance cover may also have been a
growth in Q1: Care Ratings businesses and generally run on a finan- contributing factor in the fall of such
General insurance industry in India is cial year basis and are renewed in ev- insurance premiums.
set to witness slow growth during the ery April," Care Ratings said. In April this year, non-life insurers had
first quarter of the current fiscal due The industry had booked a premium of booked a total premium of Rs 2,622
to Covid-19 lockdown, credit rating Rs 4,028 crore under fire insurance crore under motor insurance down
agency Care Ratings said. portfolio last month. from Rs 5,141 crore earned in April

In a report, Care Ratings said: "The Logging a premium of Rs 5,380 crore 2019.
insurance business is expected to wit- last month, the general insurers grew
ness muted growth in the first quarter their health segment by 6.2%, how- SN Rajeswari appointed as
of FY21 due to the extended lock ever, since it is the largest segment in
down, however the pandemic could April 2020, its growth along with the new CMD of Oriental In-
cause an increased interest in the fire segment prevented the entire non- surance
health segment." life insurance premium from being a SN Rajeswari, General Manager, New

"Further, due to the lockdown the washout. India Assurance (NIA), has been se-
claims may be lower, thereby having "However, its growth in April 2020 lected by the Banks Board Bureau
lower impact on the combined ratio of may also have been affected by IRDAI (BBB) as the Chairman and MD of Ori-
the non-life companies," it added. (Insurance Regulatory and Develop- ental Insurance Company after an
Simply put, combined ratio is claims + ment Authority of India) permitting the online video interview process in the
expenses divided by premium income. payment of renewal premium due in wake of the lockdown.

The credit rating agency said that the the March 25, 2020 to May 03, 2020 The BBB had conducted virtual inter-
gross direct premium for April 2020 fell period by May 15, 2020 and allowing views of five senior general managers
by 10.6% to Rs 14,209 crore for the the payment of health insurance pre- of the public sector general insurance
industry from Rs 15,892 crore earned mium in instalments." industry - with two years of residual
in April 2019. "This can be juxtaposed According to Care Ratings, the motor services till May 2022 - to select a CMD
to an increase of 14.5% yoy (year-on- insurance segment has witnessed a sig- for OIC. AV Girija Kumar, CMD, OIC, is
year) in April 2019," the report said. nificant decline as not many vehicles retiring this month end on reaching 60.

Barring fire, health and liability insur- were sold in April 2020, and the For the first time, the interviews for
ance portfolios, all other segments amount is generally from the renewal selecting a CMD were done through
showed a decline in premium income. of premium from existing cars. video conferencing, with the nation
under lockdown to check the spread of
The fire segment grew by about 41%, With mandatory three-year (cars) and
mainly due to increase in reinsurance five year (two wheelers) period insur- Covid-19.
rates by GIC Re in March 2019 and ance for new vehicles, the contribution Currently, B P Sharma heads a seven-
January 2020. from sale of new vehicles is high. member panel to select CMDs of PSU
The Insurance Times, May 2020 7