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Mr Yogesh Lohiya

Our Bureau

Mumbai, Aug. 14

General Insurance Corporation of India (GIC Re) is planning to convert its UK branch to a wholly owned subsidiary.

The subsidiary would be set up with an initial capital of £150 million. Explaining the rationale behind the move, Mr R. Raghavan, General Manager, GIC Re, said, “The UK branch is witnessing good volumes as the capacity of the international re-insurers has come down. It would also get a better rating as it will be independent of the parent.”

Besides the UK branch, GIC Re has a branch in Dubai and a representative office in Moscow.

The re-insurer is expanding its international footprint by entering into the Malaysian and the South African markets.

“We have received the board approval for opening a branch in Malaysia and are working on the modalities. We will also open a branch in South Africa by the end of this year,” said Mr Mr Yogesh Lohiya, the Chairman and Managing Director, GIC Re, while announcing the company’s annual results.

GIC Re reported a 42 per cent rise in net profit to Rs 1,407 crore (Rs 992 crore), as it managed to reduce its underwriting losses. The re-insurers underwriting losses were lower by Rs 714 crore at Rs 213 crore (Rs 927 crore). In the financial year 2008-09, the company managed to grow its domestic business by 17 per cent and its international portfolio by 40 per cent.

“We are targeting a 50:50 mix in domestic and international business by 2015, as against a 62:38 mix in the just ended fiscal. In the current fiscal, we are aiming at a 25-30 per cent growth in our international business,” said Mr Lohiya.

The company has a presence in 26 international markets. Its solvency ratio increased from 3.36 per cent to 3.67 per cent.

The re-insurer’s combined loss ratio (both domestic and international markets) stood at 103 per cent. Aviation, energy and liability portfolios were loss-making segments with a claims ratio of around 110-115 per cent. For other segments, incurred claims ratio varies between 60-80 per cent, Mr Lohiya said.

It has also declared a dividend of 65 per cent (46 per cent) in the financial year 2008-09. It paid Rs 279.5 crore to the Central Government as dividend.

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