”A text message sent to Alice Vaidyan, Chairman and Managing Director of GIC Re did not elicit any response. Secondly, with GIC Re being a listed company, profit is now its motive.As per the circular from GIC Re, all non-life insurance companies will have to add the cost of procurement/management costs to the IIB-identified rates and accordingly quote for their corporate clients. However, the bad thing is that corporate clients which have a favourable claims ratio too will have to pay a higher premium.Explaining the impact, another insurance broker said, “For power and pharma companies, the premium rates have gone up three times while for chemical manufactures, where the loss ratios were very high, the rates have gone up nearly nine-fold. | FALAKNAAZ SYED Published: Mar 25, 2019, 1:23 am IST Updated: Mar 25, 2019, 1:23 am IST Eight segments suffer steep hike as GIC Re increases rates.
With huge claims from corporate clients, GIC Re had been suffering and so it identified eight sectors that have huge claims outgo and where the premiums are not sufficient to meet the claims and told the insurers that treaty is available only if they follow IIB rates, which are based on the burning cost (claims outgo) of each sector,” added the broker.”“Since GIC Re is the market leader, all insurers have treaty arrangement with GIC Re. Now with the new rates, some sanity will prevail in the market.33rd Day Of Lockdown Total Cases 26,283 1,835 Recovered 5,939 China wholesale auto door seal .
In Other News Insurance cost goes up to 9-fold for companies THE ASIAN AGE.""Soon after detariffing, many insurers were charging 27 to 28 paise for a sum insured of Rs 1,000 for providing a natural catastrophic cover and 5 paise for FLEXA cover.
The new rates are based on claims data with the Insurance Information Bureau (IIB), an insurance data repository.A top insurance broker told FC, “After the non-life insurance sector was detariffed in 2007, insurers competed with each other on rates to gain market share.”Illustrating, the broker, said: "Earlier, the overall premium rate for chemical manufaturers (below 32 degrees centigrade flashpoint) was 27 to 28 paise for a sum insured of Rs 1,000, which is now 268 paise for FLEXA, natural catastrophic and earthquake cover, which translates to a nine-fold rise in insurance cost. The same was Rs 1. Mumbai: After enjoying a decade of low rates, companies buying insurance covers for their plants, machinery and properties are seeing a three- to nine-fold rise in insurance cost from this month.Thus, premium rates have gone up for companies manufacturing rubber goods, plastics, textiles, chemicals below 32 degrees centigrade flashpoint, besides transporters godowns, steel plants and thermal power plants. They were offering 99 per cent discount to corporate clients on the erstwhile tariff rates for FLEXA covers (policy covering fire, lightning explosion/implosion and aircraft insurance) while charging some premium for providing cover for natural catastrophes.
Around 60 per cent of corporate covers are renewed on April 1 annually while the remaining get renewed throughout the year. Premium rates have gone up for companies manufacturing rubber goods, plastics, textiles, chemicals, besides transporters godowns, steel plants and thermal power plants. The claims ratio in the eight identified sectors is steep. This is because the country’s largest reinsurer, General Insurance Corporation of India (GIC Re), has passed an endorsement stating that insurers wanting to utilise its treaty—an arrangement where capital is pooled by various reinsurers to give reinsurance support to insurers—will have to quote higher premium rates for providing covers to certain manufacturing segments.”Said the CEO of an insurance company, “Reinsurers have suffered large catastrophic losses worldwide.25 during the tariff era
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