The Indian
Market Terrorism Risk Insurance Pool is likely to see an uptick in capacity
with a rise in global terror incidents.
According
to insurance officials, the size of the pool, currently at Rs 1,500 crore (Rs
15 billion), could go up to Rs 1,800 crore (Rs 18 billion).
The pool was formed as an initiative by non-life insurance companies in India in April 2002, after terrorism cover was withdrawn by international reinsurers’ in the aftermath of the 9/11 attack.
The pool was formed as an initiative by non-life insurance companies in India in April 2002, after terrorism cover was withdrawn by international reinsurers’ in the aftermath of the 9/11 attack.
The pool
has thus completed 13 years of successful operation.
“The pool size is likely to be raised in 2016 with the rise in terror activities and India facing higher terror risks,” said a senior industry executive.
All non-life insurance companies of the country and General Insurance Corporation of India are members of the pool.
“The pool size is likely to be raised in 2016 with the rise in terror activities and India facing higher terror risks,” said a senior industry executive.
All non-life insurance companies of the country and General Insurance Corporation of India are members of the pool.
GIC Re
administers the pool. The pool is applicable to insurance of terrorism risk
covered under property insurance policies.
With few claims, the premium income has fallen from Rs 482.5 crore (Rs 4.82 billion) in 2012-13 to Rs 471 crore (Rs 4.71 billion) in 2013-14, according to the Insurance Regulatory and Development Authority’s annual report for 2013-14.
According to industry officials, on an average claims worth Rs 3 crore (Rs 30 million) are paid in a year. These are mostly related to small damages on account of militant activities.
Till March 31, 2012, the pool offered indemnity limit of Rs 750 crore (Rs 7.5 billion) per location for terrorism risk cover.
With few claims, the premium income has fallen from Rs 482.5 crore (Rs 4.82 billion) in 2012-13 to Rs 471 crore (Rs 4.71 billion) in 2013-14, according to the Insurance Regulatory and Development Authority’s annual report for 2013-14.
According to industry officials, on an average claims worth Rs 3 crore (Rs 30 million) are paid in a year. These are mostly related to small damages on account of militant activities.
Till March 31, 2012, the pool offered indemnity limit of Rs 750 crore (Rs 7.5 billion) per location for terrorism risk cover.
From
April 1, 2012, it was raised to Rs 1,000 crore (Rs 10 billion) per location,
which was subsequently increased to Rs 1,500 crore (Rs 15 billion) from April
2014.
Irdai had allowed a brokerage/agency commission up to five per cent on terrorism premium for business procured through brokers and agents.
Irdai had allowed a brokerage/agency commission up to five per cent on terrorism premium for business procured through brokers and agents.
It has
now proposed to revise the insurance pool’s capacity per location, rates,
deductibles and terms and coverage.
This
comes in the wake of a rise in attacks by the Islamic State and terrorist
attacks in locations such as Beirut, Paris, Nigeria, Iraq and California.
No comments:
Post a Comment