India’s national reinsurance company, General Insurance Corporation of India (GIC Re), has reported a consolidated loss of Rs 707.41 crore (approximately USD 98.9 million) for the second-quarter of this fiscal year, driven by higher agricultural losses and elevated flood claims.
For the second-quarter ended September 30th, 2019 GIC Re experienced a significant decline in profits year-on-year, with the reinsurer posting a net profit of Rs 617.43 crore (approximately USD 86.3 million) in the second-quarter of 2018.
The decline has been attributed to a rise in the volume of insurance claims, most notably in agriculture lines and also in flood as a result of extreme adverse weather conditions both globally and domestically.
According to a regulatory filing, the reinsurer’s total consolidated income increased to Rs 13,384.09 crore (approximately USD 1.9 billion) in the three month period, which is up on the Rs 12,924.29 crore (approximately USD 1.8 billion) recorded for the same period in 2018.
Gross premiums written also increased in the quarter when compared with a year earlier, reaching Rs 9,511.91 crore (approximately USD 1.3 billion) in 2019, compared with Rs 8,656.75 crore (approximately USD 1.2 billion) in Q2 2018.
GIC Re commented: “Against a backdrop of severe claims worldwide during the year 2019-2020, higher agriculture claims and also flood claims in various parts of India, in quarter ended September 2019, underwriting performance resulted in an underwriting loss to the corporation.
“In view of the nature of reinsurance risks, the financial results for the period are not indicative of full year’s expected performance.”