IRDAI expects foreign reinsurers to set up shop from January

"The new Insurance Act allows foreign re insurers to open their branches in the country. Many people have approached us," said Irdai Chairman T S Vijayan

By: PTI | Mumbai | Published:September 16, 2016 4:01 pm
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Regulator Irdai is hopeful that some global reinsurers may set up shop in Mumbai early next year and signalled that a decision on giving the second stage of licence (R2) will be taken at the board meeting in October.

The state-owned GIC Re is the only reinsurer operational in the country now.

The global reinsurers that have approached Irdai for licence include Munich Re, Swiss Re, Scor, Hannover Re, XL Catlin and RGA.

A foreign reinsurer should get three levels of licences from Irdai to start operations and some of them have already got R1 licence and now are awaiting R2 and R3.

“The new Insurance Act allows foreign reinsurers to open their branches in the country. Many people have approached us,” Irdai Chairman T S Vijayan told reporters on the sidelines of an Assocham event on Friday.

“Five to six players have approached us for licences and I think by next January, some will open their shop. We will take a decision on this at our next board meeting scheduled for the next month. I think R2 will be given at the next Irdai board meeting.”

On listing of insurers that have completed 10 years of operations, Vijayan said law demands that the companies become public, but was quick to add that it will take some more time for the regulator to finalise the draft guidelines.

“We wanted to have a discussion paper on this, so we brought out the paper and the companies have said they want to see how this goes forward. We have not come to a stage of finalising the draft,” he added.

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On listing of general insurers, Vijayan said, “The government has already said general insurers will also go for listing, but I have not seen any paper on this. But I believe there is discussion going on.”

About the new commission structure, the Irdai chief said the next board meeting will be able to finalise it.