The public sector insurers’ underwriting losses, with OIC’s largest losses of Rs 7,500 crore, constituted 77 per cent of non-life industry losses amounting to Rs 25,317 crore and remaining by private sector insurers amounting to Rs 8,699 crore, said Irda’s annual report for Fy2022-23
During the year 2022-23, the net loss of Indian non-life insurance sector marginally decreased to Rs 2,566 crore as against a net loss of Rs2,857 crore in 2021-22
Overall, there is a decrease of 858 offices for the general insurers in Fy 2022-23
Hyderabad/Mumbai:
Rs 2.5 trillion Indian general insurance industry continued to be in red with a record underwriting losses in FY 2022-23.
Led by three PSU general insurers, United India Insurance, National Insurance Company, Oriental Insurance Company(OIC), the underwriting losses of Indian non-life insurers’ increased to a record Rs 32,797 crore in 2022-23 ( Rs 31,810 crore in the previous year) in FY 2022-23.
The losses increased by 3.11 percent over the previous year.
The industry’s highest combined ratio was 156.4 per cent( as incurred by Navi General Insurance) and the lowest was at 92 per cent (as incurred by Care Health Insurance) in Fy 2022-23.
The public sector insurers’ underwriting losses, with OIC’s largest losses of Rs 7,500 crore, constituted 77 per cent of non-life industry losses amounting to Rs 25,317 crore and remaining by private sector insurers amounting to Rs 8,699 crore, said Irda’s annual report for Fy2022-23.
Standalone health insurers reported a decrease in underwriting losses in 2022-23 which is Rs 529 crore as compared to underwriting loss of 3,263 crore in 2021-22.
However, the underwriting profit of specialised insurers including stand alone health insurers(three out of five), Agriculture Insurance Company and ECGC increased to Rs 1,747 crore in 2022-23 from Rs 56 crore in 2021-22.
Among the private sector general insurers only two, ICICI Lombard General Insurance (Rs9 crore)and Universal Sampo General Insurance(Rs 8.85 crore), have recorded underwriting profit during Fy 2022-23.
During the year 2022-23, the net loss of the non-life insurance sector marginally
decreased to Rs 2,566 crore as against a net loss of Rs2,857 crore in 2021-22.
The public sector companies reported a loss of Rs 10,607 crore. The profit after tax for private sector general insurers was Rs 4,665 crore, specialized insurers was Rs 2,930 crore and the standalone health insurers was Rs 447 crore.
The investment income of all general insurers during 2022-23 was Rs 38,839 crore
( Rs 32,546 crore in 2021-22) registering a growth of 19.34 percent.
The growth in investment income of public sector insurers, private sector insurers, standalone health insurers and specialized insurers was 34.54 percent, 6.35 percent, 21.48 percent and 2.06 percent respectively.
During the year 2022-23, none of the public sector general insurers paid dividends.
However, seven private sector general insurers paid dividends with total amounting to Rs 1,166.20 crore.
None of the stand-alone health insurers paid dividends in both 2022-23 and 2021-22. Agriculture Insurance Company (AIC) of India paid Rs 40 crore dividend in 2022-23.
The incurred claims ratio (net incurred claims to net earned premium) of the non-life
insurance industry was 82.95 per cent during 2022-23 against 89.08 per cent of previous year.
The incurred claims ratio(ICR) for public sector insurers was 99.02 per cent for the year 2022-23 as against the previous year’s incurred claims ratio of 103.17 percent.
Whereas for the private sector general insurers, standalone health insurers and specialized insurers have improved ICR with 75.13 per cent, 61.44 per cent and 73.71
per cent respectively for the year 2022-23 as compared to the previous year’s ratio of 77.95 per cent, 79.06 per cent and 92.47 per cent respectively.
During 2022-23, the aggregate net incurred claims reported an increase by 6.22 per
cent over the previous year amounted to Rs 1,49,313 crore ( Rs1,40,566 crore during previous year),
Separately, the public sector general insurers, private sector general insurers and
standalone health insurers reported an increase in the incurred claims amount of 3.91 per cent,14.20 per cent and 0.54 per cent respectively, while the specialized insurers reported a decrease of 20.52 per cent.
As on March 31, 2023, the general and health insurers were operating from 9,917 offices
as against 10,775 offices as on March 31, 2022.
When compared to the previous year, for public sector general insurers, there is decrease of 1,148 offices, for private sector general insurers, there is increase of 129 offices, for Specialized insurers there is a decrease of 1 office and 162 for stand-alone health insurers.
Overall, there is a decrease of 858 offices for the general insurers in Fy 2022-23.
Winding up or pruning the redundant offices by all the 4 public sector general insurers is a wise decision
They should consider selling or redeveloping the old owned buildings through real estate & selling thereafter ( if at all permissible) can generate lot of funds
Renting flats & maintaining them for officers is expensive
Paying HRA is better
No Guest Houses
Sell all your belongings and donate it to PM Care fund for generation of fund for the country
Good suggestion. Guest Houses of PSU insurers should be shut down forthwith.
All insurance policies covering yearly period, should be issued for longer periods say for more than 2 to 5 years. Ulip linked policies should be initiated. Loss making business should be eschewed at the inception level itself.
There is no long term decision making at PSU Insurers.
Sometime back they opened umpteen Business Centres at every nook and corner, without assessing the business feasibility, under the concept ‘Expansion’. Now, they close many of the offices, under the concept ‘Consolidation’.
Now, it is time for PSU’s to make revaluation of all the assets as a one time exercise, to make its assets in tune with market prices, as there is mismatch that liabilities are accounted at current costs whereas assets are accounted at historical costs.
Young Business Development officers are to be recruited to guide and motivate the agents, besides assigning business targets,as there is a depletion of admin. staff in all PSU’s owing to Superannuation and VRS,and there are no one to guide the agents.
As Insurance is a subject matter of solicitation, PSU Companies marketing personnel should be available in the market to solicit business.
Reinsurance needs to be effective to arrest underwriting losses.
TP claims coverage, should have a ceiling for death & grievous injuries, to keep the TP premium in check, under Motor policies.
Untill and unless corruption is not being controlled from top to lowest level and responsibilities are not imposed on every employees,nothing can be done except bearing losses in the industry.
Motor dealers will have to stop being insurance agents and motor claim surveys should be done through online customer portal. On-spot survey will prevent claim manipulation and motor dealers will have to stop the process of making salvage free. Claim settlement process will have to be fast. Otherwise good quality insurance proposals will go to private insurers and non-preferred quality proposals will remain with PSU lines in which the possibility of losses are high. Only honest surveyors should be in the assessment role and subject specific experts should be appointed in companies so that the quality is maintained in the services and customers’ faith on PSU companies.
In Hindi
मोटर डीलर्स को इंश्योरेंस एजेंट बनना बंद करना होगा और मोटर क्लेम का सर्वे ऑनलाइन कस्टमर पोर्टल के थ्रू किया जाए ऑन स्पॉट सर्वे होने से क्लेम मैनिपुलेशन पर रुकावट आएगी और मोटर डीलर को साल्वेज फ्री करने की प्रक्रिया को बंद करना होगा क्लेम सेटेलमेंट प्रोसेस फास्ट करना होगा वरना गुड क्वालिटी इंश्योरेंस प्रपोजल्स तो प्राइवेट इंश्योरेंस के पास चले जाते हैं, नोंन preferred क्वालिटी प्रपोजल्स पीएसयू पंक्तियों के पास रहते हैं जिनमे लॉस की संभावना ज्यादा होती है, ईमानदार surveyors ही assessment role में रहें, कंपनियो में विषयों विशेष विशेषज्ञों की नियुक्ति की जानी चाहिए ताकि quality services मिले still Customers Faith on PSU Companies