UK-based re-insurer Llyod’s has initiated talks with insurance regulator Irda for starting operations in India and opening offices here. “Llyod’s has informally approached Irda for expansion. They have been waiting for the passage of the Bill to take this forward,” Insurance Regulatory and Development Authority of India (Irda) chairman T.S. Vijayan told PTI.
Re-insurance industry is being opened up, he said, adding that Llyod’s may be coming up with branches. Reinsurance is a business which provide insurance cover to insurance players. The amended law, passed by Parliament last week, enables foreign re-insurers to set up branches in India and defines ‘reinsurance’ to mean ‘the insurance of part of one insurer’s risk by another insurer who accepts the risk for a mutually acceptable premium’. It, thereby, excludes the possibility of 100% ceding of risk to a re-insurer, which could lead to companies acting as front companies for other insurers.
“Further, it enables Lloyds and its members to operate in India through setting up of branches for the purpose of reinsurance business or as investors in an Indian Insurance company within the 49% cap,” according to official statement by the finance ministry. Irda will soon come out with separate regulations governing the insurance syndicates of Lloyd’s and those who qualify under the norms would be allowed to operate.
The norms would ensure policyholders interests relating to claims settlement. “Lloyd’s is the world’s specialist insurance market. Unlike many other insurance brands, Lloyd’s is not a company; it’s a market where our members join together as syndicates to insure risks,” the company website said. It has about 93 different underwriting businesses.