The general insurance industry, saddled with the huge overall losses of three PSU general insurers, Oriental Insurance, National Insurance Company and United India Insurance, has slipped into net losses of Rs 2,842 crore in FY 2021-22 as against a net profitability of Rs 3,869 crore during FY 2020-21
19 full fledged private sector general insurers, led by Bajaj Allianz General Insurance, overall have been able grow their net profitability by 46 per cent year on year y-o-y to Rs 4,100 crore in Fy 2021 1-22
Four exclusive health insurers, Star Health Insurance General insurance, Manipal Cigna Health Insurance, Aditya Birla Health Insurance, Niva Bupa Health Insurance, have also added of Rs 1793 to the industry’s overall losses.
Mumbai:
Two years of Covid-19 Pandemic seems to have changed the fortunes of the Indian Insurance industry upside down.
AIP Analytics, in its report (Part-II) on “Indian General Insurance Industry Performance,” found that a record underwriting losses of Rs 28,500 crore in FY 2021-22, has pushed the Rs 2.23 trillion industry, with 31 players, into red despite having a higher investment income during the year.
The general insurance industry, saddled with the huge overall losses of three PSU general insurers, Oriental Insurance(OIC), National Insurance Company(OIC) and United India Insurance(UII), has slipped into net losses of Rs 2,842 crore in FY 2021-22 as against a net profitability of Rs 3,869 crore during FY 2020-21.
With a net profit of Rs 3,869 core, the industry had returned to black in 2020-21 after having net losses of Rs 1,402 crore in 2019-20.
The industry has suffered operating losses of Rs 1,148 crore in Fy 2021-22 as against an operating profit of Rs 6,616 crore in Fy 2020-21.
The general insurance industry had a total investment income of Rs 32,286 crore, up 11 per cent, in FY 2021-22.
Except, Bajaj Allianz General Insurance, Care Health Insurance and state owned ECGC, the profitability of rest of insurers for the industry can be attributed to their investment income and not pure underwriting in 2021-22.
Except New India Assurance(NIA), the country’s largest general insurance company, which has ended the year with a Rs 164 crore of net profit, the rest of the three general insurers OIC, NIC and UII have recorded heavy losses of Rs 3115 crore, Rs1674 crore and 2136 crore respectively in FY 2021-22.
OIC, NIC and UII have incurred losses, despite having large investment income of Rs 2,296 crore,Rs 2,650 crore, and Rs 2790 crore respectively, due to huge underwriting losses in FY 2021-22.
NIA has the largest investment income of Rs 6665 crore while ICICI Lombard General Insurance(Rs 3000 crore), Bajaj General Insurance Rs 1760 crore, HDFC Ergo General Insurance(Rs 1279 core) are the top three private sector general insurers in terms of investment income.
20 full fledged private sector general insurers, led by Bajaj Allianz General Insurance, overall have been able grow their net profitability by 46 per cent year on year(y-o-y) to Rs 4,100 crore in Fy 2021 1-22.
However, four exclusive health insurers, Star Health Insurance General insurance, Manipal Cigna Health Insurance, Aditya Birla Health Insurance, Niva Bupa Health Insurance, have added Rs 1793 crore to the industry’s overall losses.
12 private sector general insurers including one exclusive health Insurers- Care Health Insurance – have shown net profits during Fy 2021-22.
They are Bajaj Allianz General Insurance (Rs 1339 crore), ICICI Lombard General Insurance(1271.58 crore), Shriram General Insurance (Rs 663 crore), HDFC General Insurance(Rs 500 core), Tata AIG General Insurance(Rs 454 crore) IFFCO Tokio General Insurance(Rs 58 crore), Reliance General Insurance(Rs 242crore), both Royal Sunderam General Insurance and SBI General Insurance(Rs 131 crore each), Future Generali General Insurance(Rs 119 crorte), Universal Sampo General Insurance(Rs 118 crore), Cholamandalam MS General Insurance (Rs 77 crore ), Liberty General Insurance (Rs 34 crore), Care General Insurance (Rs 11 crore)
From the PSU category, three insurers from as many categories -NIA, Agriculture Insurance Company(Rs738 crore ) and ECGC (Rs 875 crore) have been profitable during FY 2021-22
Some of the companies, who have incurred net losses of over Rs 100 crore are- Star Health Insurance (Rs 1041crore), Acko (Rs 382 crore),Go Digit (Rs 295 crore), Edelweiss General insurance (Rs 109 crore),Niva Bupa Health Insurance (Rs 197 crore),Aditya Birla Health Insurance(Rs 311 crore),Manipal Cigna Health Insurance(Rs 256 crore),
Psu cos are in loss due to fake claims
In PSU general insurers Employees are
Getting huge salary
If they work for 30%,of their salary then co will be profitable.
People want promotion and facilities only
Qualified persons are not In-charge of units
Loss is increased some extent due to Nil depreciation and RTI issue cover for private cars. Loss can minimize if the wreck disposed without cancelling RC and quick disposal of wreck from the garage. Without knowledge of automobile subject doing survey is aĺso one of the reason for loss.
These companies are making losses because of sloppy people who are working there. People who get salary from these companies, neither respect any agents, nor make consult agents. TPAs and hospitals along with highly educated people must have looted these companies together.
कामचोर लोगो की वजह से ये कंपनियां लॉस कर रही है, जिन लोगो को पगार मिलती है इन कंपनियों से, वे लोग ना तो कोई एजेंट की इज्जत करता है, और न ही एजेंट से सलाह मशवरा करने की मीटिंग स्ट्रेटजी बनाते है, टीपीए और हॉस्पिटल दोनो पढ़ेलीखे, हाईली एजुकेटेड लोग मिलकर कंपनी को लुटते होंगे.
Loss increased due to NIL DEP. RTI add on and tie up business with giant like Maruti ,
Loss is increased due to heavy management expenses and the existence of non viable offices
All Govt general insurer’s not following the IRDAI guide lines properly and lethargic attitude brings them to this position
Only the PSU general insurance companies following the IRDA guidelines and not even a single private insurance company following them.
Intentionally, IRDAI is targeting PSU companies and giving free hands to private players.
In Medi clm pol. Hosp. are billing more than cash payments- more U/w discounts – no due weight age to agents – no proper diffence in MACT Claims – some employees not doing justice to their salaries – emp. Not interested in acquiring insc. Subject knowledge- simply depending on System to Generate policies- no courteus response to customers visiting offices for pol. / claim.
A few suggestions to improve this situation.
Carefully survey of accidental vehicles at Dealers premises by experts and qualified surveyors is the need of hour.In case of total loss vehicles quick disposal of wreck vehicles immediately by active participation of underwriter & Surveyor is a must.
RC cancellation should be avoided to fetch handsome salvage value. Restriction of NIL DEP policy upto 5 years of age of vehicle must be applied by all insurers.
High Discounts on premium should be restricted by the IRDA or through a law in parliament. Prudent underwriting should also be resorted by all insurers.
Government intentionally weakening the PSU general insurance companies. By that, it will be easier to sell them to private companies as PSUs have a great infrastructure and customer base.
Irda guidelines are complied by PSU general insurers but Private sector insurers don’t.
In Medi clm pol. Hospitals are billing more than cash payments- more U/w discounts – no due weightage to agents – no proper defense in MACT Claims – some employees not doing justice to their salaries – employees are not interested in acquiring business and subject knowledge- simply depending on System to Generate policies- no courteous response to customers visiting offices for buying policies and getting claims
In Medi clm pol. Hosp. are billing more than cash payments- more U/w discounts – no due weight age to agents – no proper diffence in MACT Claims – some employees not doing justice to their salaries – emp. Not interested in acquiring insc. Subject knowledge- simply depending on System to Generate policies- no courteus response to customers visiting offices for pol. / claim