A total of 11 cross border reinsurers have been granted special approval by the Insurance Regulatory and Development Authority of India (IRDAI) for FY20. This is compared to 16 approvals given for FY19.
Among the 11 entities given permissions are Republican Unitary Enterprise-Belarusian National Reinsurance Organization, Nepal Re, East Africa Re, CICA Re and PICC Re.
Cross Border Reinsurers (CBR) refers to those reinsurers who do not have any physical presence in India and do reinsurance business with Indian insurance or reinsurance companies. Reinsurance refers to the risk cover taken by insurance companies against the liability business that they write.
Every year IRDAI brings out a list of CBRs who will be allowed to operate in the country for that particular duration.
To be eligible, all CBRs should have a credit rating of at least BBB (with Standard & Poor) or equivalent rating of any other international rating agency for five years.
Further, the past claims performance of the CBR should be satisfactory. IRDAI has also mandated that the cross border reinsurer shall be a legal entity in its home country and regulated and supervised by its home regulators and supervisors.Financial strength, quality of the management and adequacy of technical reserving methodologies of the cross border reinsurer should be monitored by its supervisory authority, in the home country, IRDAI said.Get access to India's fastest growing financial subscriptions service Moneycontrol Pro for as little as Rs 599 for first year. Use the code "GETPRO". Moneycontrol Pro offers you all the information you need for wealth creation including actionable investment ideas, independent research and insights & analysis For more information, check out the Moneycontrol website or mobile app.