General Insurance Corporation, India's national re-insurer, is expected to take a Rs 100-crore (Rs 1-billion) hit in claims for the fire that broke out at the Indian Oil Corporation complex near Jaipur last month.
GIC chairman and managing director Yogesh Lohiya told reporters on the sidelines of a conference that the sum insured for the IOC complex was Rs 230 crore (Rs 2.3 billion), of which GIC had re-insured 30 per cent and this will be liable for about Rs 70 crore (Rs 700 million).
As the national re-insurer, GIC is required to reinsure 10 per cent of the amount and had covered an additional 20 per cent. In addition, GIC had also re-insured 20 to 25 per cent of Rs 150 crore (Rs 1.5 billion) in third-party liabilities. The total thus adds up tp around Rs 100 crore (Rs 1 billion).
Insurers are likely to take a hit of up to Rs 140 crore (Rs 1.4 billion) from the recent fire accident at the IOC marketing plant. The plant was insured for Rs 230 crore (Rs 2.3 billion) by ICICI Lombard as the lead insurer, while Oriental Insurance had the second-largest share, followed by Iffco Tokio and National Insurance with 10 to 15 per cent stake each.
Speaking on the firm's international expansion plans, Lohiya said the re-insurer was in two minds about its earlier plan to open a subsidiary in the United Kingdom. He said the firm also had the option of forming a syndicate with UK-based Lloyds.
"The advantage in going for a syndicate is that Lloyds' rating would be applicable to us. However, we will consider both options and decide next year," he said.
Lohiya added that international premiums were stable, despite claims arising from air mishaps this year. International operations account for 39 per cent of the firm's business and will rise to 42 per cent by the March-end, he said.
On claims for damage caused to the Taj and Oberoi Trident hotels in Mumbai during the 26/11 terrorist attacks last year, Lohiya said GIC had already paid Rs 120 crore (Rs 1.2 billion) out of the Rs 500 crore (Rs 5 billion) claimed. The total terror pool is around Rs 1,300 crore (Rs 13 billion).
