International reinsurers flock to Mumbai to tap “huge opportunity”

International reinsurers continue to announce the creation of onshore reinsurance operations in India following the recent relaxation in rules designed to attract fresh risk capital to this rapidly growing market. XL Catlin announced this week that its reinsurance business group has received final approval from the Insurance Regulatory Development Authority of India (IRDAI) to open an onshore reinsurance branch office the country. The operation will be based in Mumbai and provide treaty and facultative reinsurance. It will be led by Joseph Augustine as branch CEO who plans to be up and running for the critical 1 April renewal period. Mike McGavick, chief executive of XL Catlin, said: “The re/insurance market in India is evolving and developing at a staggering pace; there is huge opportunity for reinsurance companies who understand the local market and have a global track record in delivery. We are delighted to receive final approval of our licence and feel we can make an important impact in this critical region.” The partial opening up of the Indian insurance and reinsurance market to international players has been a long and politically sensitive process. As with all emerging insurance markets national governments and regulators are keen to ensure that international insurers and reinsurers do not simply shift the premium back home and add little to the development of the local market. XL Catlin is clearly aware of this priority as Greg Hendrick, XL Catlin’s president of Property & Casualty, added: “In addition to our strong client focus, we are also committed to playing our part as a global company to contribute to the development of the reinsurance market in India. We intend to bring in our global expertise and provide regular training for our team in India as well as broader market workshops on key areas including underwriting, claims management, communications and sales.” Also this week Swiss Re announced that it had received approval from IRDAI to open a branch in Mumbai. Swiss Re has a composite licence and is therefore able to offer both non-life and life and health reinsurance solutions directly to clients and brokers in India. Swiss Reinsurance Company Ltd, India Branch, will open its doors to business on 1 February. Swiss Re pointed out that the Indian insurance sector is poised for strong growth with an average annual growth rate of 8% from 2017 to 2025, Swiss Re chief executive officer reinsurance Asia, Jayne Plunkett, said: "This is a significant milestone for us. As a reinsurer, Swiss Re has served Indian insurers for over 87 years. Our new Indian branch, together with Swiss Re Global Business Solutions centred in Bangalore, represents our commitment and investment in India's long-term future, and our ambition to be part of this dynamic high growth market." Swiss Re is also clearly mindful of the need to support the development of the local market as well as its own revenue and profits. "We will continue to be actively involved in supporting the development of the Indian insurance market and making India's society more resilient. Our clients and partners will benefit from a combination of innovative, customised risk transfer and capital management solutions, as well as our knowledge transfer and risk services support and delivery," added Ms Plunkett. Kalpana Sampat, currently managing director of Swiss Re Services India Private Ltd, will head the Swiss Re India branch as its CEO. Just before year-end Hannover Re announced that it had received approval from IRDAI to establish a branch in India. It said that it would also write property and casualty as well as life and health reinsurance. "I am delighted about the opening up of the Indian market for (re)insurers. The establishment of our branch means that we can now be even closer to our customers and respond more attentively to their reinsurance needs," said Hannover Re's chief executive officer Ulrich Wallin. The German reinsurer’s office will also be in Mumbai. It said that property and casualty reinsurance, including agricultural risks, as well as life and health business will be written out of this location. “With a total population of some 1.3 billion, a rapidly growing middle class and a comparatively low insurance density relative to other national economies, India constitutes an attractive market of the future,” stated Hannover Re.

International reinsurers flock to Mumbai to tap “huge opportunity”

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