Financial Daily from THE HINDU group of publications
Monday, Sep 19, 2005
Financial Daily from THE HINDU group of publications Monday, Sep 19, 2005 |
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Money & Banking
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General Insurance GIC, a leader in reinsurance Our Bureau
FROM a holding company of four insurance companies to full-fledged reinsurer, General Insurance Corporation of India has etched its position as monolith through the annals of insurance history. After the nationalisation of the general insurance business in 1972, GIC mainly transacted aviation business and was responsible for arranging for reinsurance. After an eventful three decades as a holding company of four non-life insurance companies — National Insurance Company, New India Assurance, Oriental Insurance Company and United India Insurance Company — GIC's status underwent a major change in November 2000 when it became the country's reinsurer. GIC is a leader in reinsurance programmes of many insurance companies in India and in neighbouring SAARC countries, South-East Asia, West Asia and African. The reinsurance programme arranged by GIC aims at optimum retention of insurance premium within the country while securing maximum reinsurance coverage at a minimum cost. GIC has been diversifying its operations by accepting new lines in life reinsurance, financial reinsurance, offshore energy and liability business. GIC's financial strength and claims paying ability are reaffirmed by International and Indian rating agencies. A.M. Best gave the company a rating of "A (Excellent)" for its financial strength while CARE reaffirmed its "AAA" status in terms of its claims paying ability. The assigned rating factor in GIC's status in the Indian insurance industry as the national reinsurer, its dominant market share, strong solvency position, low operating leverage and good profitability. The net premium income of GIC in the last fiscal amounted to Rs 4,613.87 crore, a growth of 10.8 per cent from the previous year. The company booked a profit before tax of Rs 800 crore and PAT of Rs 200 crore. GIC's support to the Indian market comes in the form of obligatory cessions, company surplus treaties, market surplus treaties, excess of loss protection to direct writing companies and facultative acceptances.
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