Page 6 - Insurance Times March 2021

Gadkari calls for reducing processing. While Oriental Insurance standalone health insurers, surprisingly,
settled 91.5% of claims that came up saw a marginal contraction of 1.33 per
road crash deaths for processing, Iffco Tokio had a cent in premiums collected in January

The road accident scenario in India is settlement ratio of 92.5% for overall at Rs. 1,510.20 crore compared to Rs.
more dangerous than the pandemic, claims across segments. The two 1,530.70 crore in the year ago period.
Union Minister Nitin Gadkari said, as he insurers topped the list of claims This could be indicative of the fact that
pointed to potential savings of Rs. 90 settlement ratio in the health segment growth in health insurance segment
lakh per person if such deaths are as well (93.9% and 96.3%, might be tapering off as the fear of
prevented. respectively). Both also did well in the Covid subsides among consumers.
Releasing a World Bank report on motor own-damage segment, which is Of the four state owned general
traffic crash injuries, Gadkari said: "For a major contributor to claims. insurers, New India Assurance's
the government, each life is precious, When it comes to speedy claims premium collection jumped 20 per cent
whether poor or rich, urban or rural, settlements too, Oriental Insurance to Rs. 2,473.69 crore in January and
male or female. The situation is topped the list with an efficiency ratio United India Insurance saw its
alarming… there are more deaths than of 87.1%. This reflects the number of premium go up marginally, while the
in COVID-19… It is more dangerous claims tackled within three months of other two witnessed a contraction in
than COVID-19." reporting. In the private sector, Bajaj their premium collection. Recently, in
He termed the World Bank report an Allianz had the highest claims the Union Budget of 2021-22, the
eye-opener.India accounts for the settlement efficiency of 87.9%. Finance Minister said they are looking
highest number of road accidents According to brokers, the extent of to privatise one of the state owned
globally, with 1.5 lakh people being claims that an insurer receives depends general insurers.
killed and more than 4.5 lakh being on the nature of business they
disabled annually in 4.5 lakh road underwrite. Companies that cover Govt to infuse Rs. 3000
accidents. The losses amount to 3.14 retail risks such as health insurance and crore into general
per cent of the GDP. motor tend to have a higher number insurance firms
"In India, the cost per seriously injured of claims as these are verticals with a
person comes to Rs 3.64 lakh while the high frequency of the same. Of late, Government will infuse Rs. 3,000 crore
cost for a person with minor injury is insurers have been providing extended capital into PSU general insurance
Rs 77, 938. The cost per death is warranty covers for electronics companies during the current quarter
estimated at Rs 91.16 lakh," he said. purchased by tying up with the in a bid to improve their financial
distributors. Such businesses too have health.
Oriental Insurance, Iffco low-value high frequency claims. Last year, the Union Cabinet headed by
Prime Minister Narendra Modi cleared
Tokio General Insurance Non-life insurers see 6.7% the proposal to provide capital support

top in claim settlements growth in premiums to National Insurance, Oriental
Insurance and United India Insurance.
Oriental Insurance and Iffco Tokio had Gross premium underwritten by non-
the highest claims settlement ratio life insurers in January grew 6.7 per The cabinet had also decided to
among public and large private sector cent year on year (YoY) to Rs. 18,488 increase the authorised share capital
non-life insurance companies, crore compared to Rs. 17,333.7 crore of National Insurance Company
respectively, in FY20. New India in the year ago period. This comes Limited (NICL) to Rs. 7,500 crore and
Assurance had the highest net after a double digit growth in that of United India Insurance
promoter score, according to a report premiums in December and low single- Company Limited (UIICL) and Oriental
published by the Insurance Brokers digit growth witnessed in November, Insurance Company Limited (OICL) to
Association of India. which was preceded by contraction in Rs. 5,000 crore each to give effect to
September and October. the capital infusion decision.
The claims settlement ratio is seen as
a key reflection of service by an insurer. General insurers, collected Rs Recently, the government sought
It is arrived at by dividing the sum of 16,247.34 crore premium in January, Parliament nod for gross additional
claims settled during the fiscal as a up 10.8 per cent compared to the expenditure of Rs. 6.28 lakh crore for
percentage of the same available for same period a year ago. The 2020-21 as part of second and final

6 The Insurance Times, March 2021