Reinsurance News

Lloyd’s eyes “terrific” growth prospects in India market

25th January 2018 - Author: Staff Writer

Speaking to the India Economic Times Lloyd’s Chief Executive Officer (CEO) Inga Beale called India “a fantastic opportunity” with “terrific” growth prospects, as Lloyd’s looks to expand local syndicates and increase its current $220 million annual India market revenue.

Lloyd's of London insurance and reinsurance market “Whether the growth in insurance line is driven by government action or whether it is just natural growth based on the fact that the economy is growing, where else in the world could we go and see non-life insurance premium growth in the double digits and you have forecast something like 12% to 15% growth. It is a fantastic opportunity and that is the way we see India at the moment,” Beale said.

Lloyd’s is expecting to see premium growth of about $10 million from its Indian market syndicates, MS Amlin and Markel, one year after opening the local reinsurance branches.

Lloyd’s India Country Manager and Chief Executive Shankar Garigiparthy told reporters the company is looking to expand and is in talks with three to four local Syndicates, focusing on title insurance, Directors and Officers liability insurance, and cyber security, according to Outlook India.

Lloyd’s had established a reinsurance branch in the country prior to the 2017 April renewal season, and its syndicates have since been working fast in an effort to increase their presence in the region and capitalise on the numerous regulatory changes that facilitated the entry of foreign re/insurers, and the specialist Lloyd’s marketplace.

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Beale told the Economic Times that the insurer sees “the absolute need to be local,” moving away from “doing everything from London.

“Hence, we have opened up our platform here, we are onshore. We need to be closer to our customer base, we need to have people working within the market where we are doing business. That is why we are very keen on having this onshore platform here.

“The benefit for us is that we can build those trusted relationships, we can be part of an exciting market that is growing and that is what our customers are wanting. They do not want remote long distance relationships and our business is based on trust. We are ensuring insurance companies here in India. We are reinsurers and that means big contracts, big promises to pay for the future,” she said.

2018 is forecast to be a big year for the India re/insurance sector, with newly relaxed capital rules that allow well-established Indian insurers to attract capital with an initial public offering (IPO) and the government increasingly opening the grounds to foreign reinsurers, according to Clyde & Co.

The renewed focus on agricultural risks by the Indian government and domestic insurers are also expected to provide new opportunities to foreign reinsurers.

Munich Re’s Economic Research unit has also projected steady growth for the Indian reinsurance market, with more than 9% annual real premium growth in property & casualty and around 10% in life premium expected between now and 2025.

In light of the region’s outstanding economic growth and somewhat more welcoming stance towards foreign re/insurers, Lloyd’s Inga Beale cited has high hopes for its Indian market growth prospects; “currently on an annual basis, we have business revenues of about $220 million.

“Now if I can see growth on that in excess of the growth in insurance in the Indian market, then I would be very, very happy. However, because we run a market, we basically provide the framework and the ability for different syndicates to come and open up in India. If more and more syndicates chose to open up, we might easily exceed that insurance growth you are seeing in India. But I would be happy if we just exceeded or even met that growth.”

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