Russian reinsurer sets sights on Asia

Firm seeking to expand outside internationally-sanctioned home market

Russian reinsurer sets sights on Asia

Insurance News

By Gabriel Olano

The chief executive of the Russian National Reinsurance Company (RNRC) has said that the state-owned reinsurer is looking to enter the markets of China, India, the Middle East and Africa in a bid to diversify and increase its premium income.

The reinsurer was formed to cater to firms that have lost access to Western reinsurance cover due to sanctions imposed on Russia over its annexation of Crimea. RNRC also does business with firms that are not included in the sanctions.

Since it began operations on January 1, its premium income for the first half of 2017 reached RUB3 billion (US$52 million). One-fourth of its premium income came from companies hit by the sanctions, including the Russian military.

RNRC chief executive Nikolay Galushin told Reuters that Western sanctions are unlikely to hurt the company’s business outside of Russia, and that it plans to reach RUB5 billion (US$86.5 million) in overseas premium income by 2021.

“Our cooperation with Chinese insurers involves us joining a number of joint projects, such as Power of Siberia, infrastructure, the silk road project, high-speed train link from Moscow to Kazan”, Galushin said.

He added that RNRC is also considering deals in India, the Middle East, North Africa, and ex-Soviet countries.

Although RNRC started with limited capital, in May the Russian central bank gave it a financial guarantee of RUB49.7 billion (US$859.5 million) so it can tackle bigger risks.

Galushin also revealed that the reinsurer may undergo an initial public offering in the future, aimed at Russian and Asian investors.

Related stories:
Global reinsurers facing rougher seas ahead
Meet the world’s worst insurance fraudster
Fitch: Profitability expected to decline in European reinsurance

Keep up with the latest news and events

Join our mailing list, it’s free!