Two multinational reinsurers from France,
SCOR and
AXA Re, are joining seven other global firms in India’s growing reinsurance segment.
The seven – Gen Re, Hannover Re, Lloyd’s,
Munich Re, RGA,
Swiss Re, and
XL Catlin – have all received approval from the Insurance Regulatory and Development Authority of India (IRDAI). Combined, the nine firms are expected to bring in INR50 billion (US$776.2 million) to commence operations in the country, reports the
Indian Express.
SCOR, which is the fifth-largest reinsurer in the world, has already begun operating while AXA Re is setting up its first branch operations outside of its Paris headquarters and has recently received approval from IRDAI.
Victor Peignet, CEO for global property and casualty at SCOR said: “We expect the P&C Indian insurance and reinsurance markets to continue growing at 15% a year in the medium-to-long term. Our strategy is to partner with a selected number of clients, with whom our long-term relationship is more important than short-term interests.”
Huge natural catastrophes such as Cyclone Phailin in 2013 and the Chennai floods in 2015 have caused several large losses to the Indian reinsurance markets, keeping it in deficit. Pricing remains a challenge in the market, but reinsurers are anticipating a market correction caused by a decline in investment income and the expected IPOs of several insurance companies.
With nine global players present in the market, it seems that India is developing into an Asian reinsurance hub.
“We know the government is trying to develop India as global reinsurance hub and we would like to be a catalyst in this government effort,” a government official was quoted as saying by the
Indian Express.
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