reliance general - lloyd's of london

Reliance general

•Mr Sam Ghosh, CEO •Mr Vijay Pawar, Executive Director •Mr Rakesh Jain, CEO•Mr. Arvind Naaz, CMO, •Mr Mukul Kishore, Sr VP •Mr. Praveen Pathak, Dy VP•Mr Rajat Dutt, Dy VP•Mr Sumit Dutt, Sr VP, Reliance Composite Insurance Broking

8th February 2012

Reliance General Insurance

Contents

Reliance Group

Opportunity for financial services and products in India

Reliance Capital

Indian Non-Life Insurance Landscape

Market Outlook

Reliance General Insurance

Current & Future Insurance Needs

Emerging Class

Lloyd’s Market – Advantage & Challenges

Confidential

The vision of one man

If you can dream itYou can Do it

Our legendary founderShri Dhirubhai Hirachand Ambani 28th December 1932 - Forever

Confidential

Reliance Group

Reliance Group

CommunicationsFinancial Services Power

Media & Entertainment Infrastructure

Amongst India’s leading business groups* - as on March 31, 2011

Over 230 million customers – 1 in every 5 Indians10 million shareowners – amongst largest in the worldGroup assets of over US$ 37 billion*Group net worth of US$ 19 billion*Flagship stocks included in Junior Nifty, MSCI and Futures & Options

Confidential

India – A growth opportunity

Robust GDP growth : Amongst top 5 and fastest growing^

Increasing per capita income : FY10 US$ 3,339* (PPP)

Rising savings rate : >34%

Young population : Median age 26.2 years^

Infrastructure Investment: Rs. 45 tn envisaged in 12th plan

Demand for financial

products & services

Financial services market set to grow exponentially^ Source: CIA World Fact book*Source: IMF Estimate # CLSA report on Chindia Banking

Confidential

Non-Life industry is growing at rapid pace….

Industry likely to quadruple to INR 2,500 billion by FY 2020 at 20% CAGR.Penetration still to be lowest in peer comparison.

….but is still hugely under penetrated

Confidential

Industry Profitability

Industry moving towards profitability

INR in mln

Year Results IndustryFY‐2009 Underwriting ‐50,910

Investment Income 56,200PAT 4,070

FY‐2010 Underwriting ‐59,250Investment Income 74,350PAT 12,100

FY‐2011 Underwriting ‐101,470Investment Income 93,280PAT ‐9,530

H1‐2011 Underwriting ‐41,600Investment Income 38,380PAT 230

H1‐2012 Underwriting ‐36,860Investment Income 48,000PAT 8,450

Confidential

Domestic Market Outlook - Reinsurance

Due to large market losses & low original rates, results of proportional treaties

continue to be depressed.

Absence of “event limit” in the proportional treaties is a concern for many

reinsurers.

Thai Flood losses have affected some domestic treaties also in the market on

account of coverage under “Indian Interest Abroad”.

Increasing Motor TP Pool loss ratio provisioning will have impact on Net worth

of the companies.

Confidential

Domestic Market Outlook - Direct

Overall GI Industry growth will be robust driven primarily by health & motor.

Property & Engineering rates have stabilized

Though there is no significant improvement in pricing.

Market discipline in implementing increased deductibles.

At General Insurance Council level industry level effort is being made for :

Further improvement in deductible

Agreement on a minimum rates for CAT perils.

Marine Cargo portfolio is gradually improving post steep decline in property &

Engineering premium rate.

Health portfolio has seen significant improvement in pricing.

Confidential

Amongst leading Indian private sector general insurers with private sector market share of over 8% in H1 FY12

100% Indian private sector insurance company

Strong reinsurance program supported by leading global reinsurers

152 branches; over 5,200 intermediaries

Amongst India’s leading private general insurers

Confidential

Licensed by the IRDA in October 2000

Only General Insurance Co in India which is ISO Certified for all Business functions

Reliance General- The Journey so far

* As on YTD Dec,2011

Confidential

Sector – wise premium contribution

Motor65%

Health15%

Fire6%

Engineering4%

Others10%

FY11

Defocus from unprofitable segments with high combined ratios

Motor63%Health

14%

Fire8%

Engineering6%

Others9%

H1 FY12

Confidential

Product Mix movement

15% +20% growth

Confidential

Commercial Lines

Focus on property business, mix to increase to 25% in two years.Participation in Fire, Weather, Liability insurance backed by reinsurance program.Special focus on SME segment and package policiesCritical evaluation of reinsurance program

41% annual growth

Confidential

Current & Future Insurance Needs

Treaty Reinsurance

ProportionalNon-proportional

Facultative Reinsurance

Casualty/Financial LinesEnergyAviationTerrorismMarine - Project/Bulk/DSUConstruction- EAR/ALOP

Confidential

Emerging Class/ Product Opportunity

Weather related Products

State Sponsored Health Scheme

Health & Travel Cover for High Networth Individual

Art Insurance

Casualty/Financial Line

Confidential

Lloyd’s Market – Advantage & Challenges

Advantages

Large Capacity

Financial Rating

Specialized Products

Competitive pricing

Marine and DSU

Terrorism

PA

Challenges

Low deductible prevailing in

Indian Market

Thin original rates

Minimum rate on line

requirements higher than the

regional reinsurers

Thank You

Essar group

•Dinyar M Jivaasha,Group Global Head & Sr. Vice President, Corporate Risk and Insurance Management

•Ms Jui Buch, Deputy General Manager, Corporate Risk & Insurance Management

Tata motors insurance broking and advisory services

•Anand Umarji , Senior Consultant –Business Development •Deepak Sharma, Head of Insurance & principle officer•S. Gopalakrishnan, DVP•Bhupesh Mittal – Assistant VP

Tata Motors Insurance Broking and Advisory Services Ltd

Tata Group – An Overview

http://www.youtube.com/user/TataCompanies?feature=watch

http://www.youtube.com/user/TataCompanies?feature=watch


Our Group Chairman Statement

1

"One hundred years from now, I expect the Tata’s to be much bigger than it is now. More importantly, I hope the group comes to be regarded as being the best in India — best in the manner in which we operate, best in the products we deliver, and best in our value systems and ethics. Having said that, I hope that a hundred years from now we will spread our wings far beyond India...“

— Ratan N Tata


2

Founded by Jamsetji Tata in 1868

Businesses in seven sectors- information systems and communications,

engineering, materials, services, energy, chemicals and consumer products

Operations in over 80 countries

Product and services available in over 85 countries

Over 425,000 employees

Group revenues of 2010-11: $83.3 billion

International revenues2010-11: $48.3 billion

Geographies 58% other than India

Tata’s contribution to India’s GDP is nearly 5.5% and 60% of its revenue comes from foreign countries.

Brand Finance, a UK-based consultancy firm, valued the Tata brand at $15.75 billion in 2011

Tatas - India’s largest business group


3

Tata Steel - Among the top ten steelmakers in the world

Tata Motors - Among the top five commercial vehicle manufacturers in the world

Tata Global Beverages - Second-largest player in tea in the world

Tata Chemicals - World’s second-largest manufacturer of soda ash

Tata Communications - One of the world's largest wholesale voice carriers

Indian Hotels- first property, the Taj Mahal Palace, in Bombay in 1903

Shareholder base - 3.6 million

Number of companies - Over 100 operating companies

Listed companies - 31 on the Bombay Stock Exchange combined market capitalisation of about $80.59 billion (as on January 19, 2012)

Companies Listed on NYSE - Tata Motors and Tata Communications

Leadership


4

Established the first steel plant

Introduced labour welfare benefits long before they were enacted by law

Started the first power plant

Pioneered civil aviation

Brought insurance to the country

Started the country’s first chain of luxury hotels

Largest commercial vehicle producer in India

Pioneered software development

Manufactured the country’s first indigenous passenger car, the Indica and affordable, innovative such as the Tata Nano,

Pioneering initiatives in India


51

Tata Motors

Risks Philosophy:All of the Company‘s operating plants in India have been certified to OHSAS - 18001 and ISO - 14001 standards and all the CVBU units have been conferred with the ‘Golden Peacock Award’ on Safety & Health. Jamshedpur plant was adjudged first and was awarded by CII (Confederation of Indian Industry) Eastern Region in Safety, Health & Environment Practices. The Company took steps towards ensuring that every single individual working within its plant premises is protected from any harmful impact of his/her working and the inherent risks. Towards this end, the Company recently completed a diagnostic of the existing safety systems through DuPont and is taking steps to raise the safety standards to world class levels.

Concern - Political instability, wars, terrorism, multinational conflicts, natural disasters, fuel shortages / prices, epidemics, labour strikes:The Company’s products are exported to a number of geographical markets and the Company plans to expand international operations further in the future. Consequently, the Company is subject to various risks associated with conducting the business both within and outside the domestic market and the operations may be subject to political instability, wars, terrorism, regional and / or multinational conflicts, natural disasters, fuel shortages, epidemics and labour strikes. In addition, conducting business internationally, especially in emerging markets, exposes the Company to additional risks, including adverse changes in economic and government policies, unpredictable shifts in regulation, inconsistent application of existing laws and regulations, unclear regulatory and taxation systems and divergent commercial and employment practices and procedures. TCS

Risks Philosophy:A comprehensive and integrated risk management framework forms the basis of all the de-risking efforts of the Company. Formal reporting and control mechanisms ensure timely information availability and facilitate proactive risk management. These mechanisms are designed to cascade down to the level of the line managers so that risks at the transactional level are identified and steps are taken towards mitigation in a decentralized manner.

Legal risksLitigation regarding intellectual property rights, patents and copyrights is significantly high in the software industry. In addition, there are other general corporate legal risks.

Risk Philosophy (Source Annual Report FY 2010-11)


61

Tata Steel

Risks Philosophy:The Company’s focus, at all times, is to identify the hazards, determine the risks and ensure that effective controls are in place to minimize the potential of a major incident. The Company assesses sites for potential risks and creates and implements effective process safety. The Group’s philosophy is that all injuries can be prevented.

Concern - Health, Safety & Environmental Risks:The manufacture of steel involves steps that are potentially hazardous if not executed with due care. The Group’s businesses are subject to numerous laws, regulations and contractual commitments relating to health, safety and the environment in the countries in which it operates and these rules are becoming more stringent. In Europe, auction based proposals by the EU Commission for Phase 3 of the Emission Trading Scheme (‘ETS’) could, as they currently stand, have a significant negative financial impact post 2012.

Tata Chemicals

Risks Philosophy:TCL’s risk identification and assessment process is dynamic and hence the Company has been able to identify, monitor and mitigate the most relevant strategic and operational risks both during periods of accelerated growth and recessionary pressures.

Concern - Safety and Environment related risks: TCL is conscious of its strong corporate reputation and the positive role it can play by focusing on social and environmental issues. Towards this, the Company has set very exacting standards in safety, ethics and environmental management.



71

Tata Power

Risks Philosophy:

As part of the Risk Management Process (RMP), during the year, the Company reviewed the various risks and finalized mitigation plans. These were reviewed periodically by the Risk Management Committee. Further, seven Risk Management Sub-Committees (RMSCs) closely monitored and reviewed the risk plans periodically. Employees contribute to the risk identification process through the web-based Risk Perception System.

Concern – India Scenario

In view of the inherent risks and challenges in developing and executing new projects and rising fuel costs, the cost of generation is likely to increase.



81

At present the overall premium output of the TATA Group is INR 500 crores

Employee Benefits will be at 60% (approx) of the overall portfolio

Property & Casualty will be at 40% (approx) of the overall portfolio

Tata Group – Premium output (approx)


91

Tata Motors Insurance Broking & Advisory Services Ltd was granted a Direct Broker License by the Insurance Regulatory and Development Authority (IRDA) in May 2008 for undertaking Direct Insurance Broking in Life and Non-Life insurance businesses. It has placed business with all public and private insurance companies to enable offering customized solutions to customers. As a Total Insurance Risk Solutions provider, Tata Motors Insurance Brokers plays an integral role in managing the portfolios of the customer through Risk Advisory & Risk Management.

Tata Motors Insurance Broking and Advisory Services Ltd (TMIBASL) forms a part of Tata Motors Ltd as their wholly owned subsidiary. Tata Motors Ltd, is India’s largest Automobile company with a consolidated revenues of Rs.1,23,133 crores (USD 27 billion) in 2010-11. Tata Motors Limited is a leader in commercial vehicles in each segment, and among the top three automobile manufacturers in passenger vehicles with winning products in the compact, midsize car and utility vehicle segments. Tata Motors Limited is the world's fourth largest truck manufacturer, and the world's third largest bus manufacturer.

To provide world-class, cost-effective, performance-backed insurance products to automobile customers, value-added insurance services to corporate and retail customers and spread awareness of insurance.

Apart from being the insurance broker for the Tata Group companies, Tata Motors Insurance Broking and Advisory Services Ltd (TMIBASL) is also a insurance broker for Ford, Nissan & Rennault.

We undertake to deliver world class broking services in compliance with IRDA Insurance Broking 2002 guidelines.

About – Tata Motors Insurance Broking & Advisory Services Ltd


101

Corporate Exposure (approx)

Total Sum Insured - INR. 40,000 Crores

Total Premium - INR. 86 Crores

Retail Exposure (approx)

Total Sum Insured - INR 15,000 Crores

Total Premium - INR 650 Crores

Total Policies issued - 5,00,000

Portfolio – Tata Motors Insurance Broking & Advisory Services Ltd


Thank You

Aditya birla

•Satish Deshpande, Priniciple Officer•Dr. Sandeep Dadia, Executive Vice President & Business Head•Mr Dipankar Chowdhury•Mr Malay Mukherjee

Copyright Aditya Birla Insurance Brokers Ltd 2010

Aditya Birla Insurance Brokers

Overview of Aditya Birla GroupPresentation to delegation of Lloyd‘s

8th February 2012

Aditya Birla Insurance BrokersCopyright Aditya Birla Insurance Brokers Ltd 2010

Vision and Values | The Glue that Binds UsVision and Values | The Glue that Binds Us

OUR VISIONTo be a premium global

conglomerate with a clear focus on each business

OUR MISSIONTo deliver superior value to our

customers, shareholders, employees and society

at large.

OUR VALUESIntegrity

CommitmentPassion

SeamlessnessSpeed


At a Glance | Over 50 years of History

1850s 1900-30 1930-70s 1970-90

Procurement andTrading

1990s 2000-2005 2005-2010

Trading and Basic Manufacturing

A Conglomerate taking shape

• Set-up Grasim, Hindalco, Eastern Spinning

• Acquired Indian Rayon

Going Global

• Indonesia

• Thailand

• Malaysia

Service Business Expansion

•Financial Services

•Telecom

• Egypt

• Copper

• Cement business of Indian Rayon demerged to Grasim

Acquisitions

• Indal - Aluminium

• L&T - Cement

• Madura Garments

• PSI - IT Services

• Annapoorna Foils

• Carbon Black in China

• Copper mines in Australia

• Pulp mill in Canada

•Acrylic Fibre in Egypt (Greenfield)

Growth and Consolidation

• Formation of Nuvo

• Increase in copper smelter capacity

• Cement and aluminum – capacity addition

• Carbon Black expansion

• Entry into Retail

• Acquisition of Novelisand Minacs

• Pulp Mill in Canada

24 BUYOUTS IN LAST 17 YEARS & REVENUE TARGET OF US$ 65 BN BY 2015

In 2011

•Acquisition of Columbian Chemicals, Chemical Division of Kanoria Chemicals, & Domsjo Fiber

•Revenue US$ 35 bn

•50 companies across 6 continents in 36 countries

•Over 60% revenues from international operations

•133,000 employees belonging to over 42 different nationalities


At a Glance | Globally & in India

Globally, the Aditya Birla Group is:• A metals powerhouse, among the world’s most cost-efficient aluminium and

copper producers. Hindalco-Novelis is the largest aluminium rolling company. It is one of the three biggest producers of primary aluminium in Asia, with the largest single location copper smelter.

• No.1 in viscose staple fibre • No.1 in carbon black • The fourth-largest producer of insulators • The fifth-largest producer of acrylic fibre• Among the top 10 cement producers• Among the best energy-efficient fertiliser plants

In India, the Aditya Birla Group is:• A top fashion (branded apparel) and lifestyle player • The second-largest producer of viscose filament yarn • The largest producer in the chlor-alkali sector • Among the top three mobile telephony companies • A leading player in life insurance and asset management • Among the top two supermarket chains in the retail business • Among the top 10 BPO companies


Business Sectors

oNon – Ferrous MetalsoCement – Grey & WhiteoTextiles (pulp, fibre, yarn, fabric, apparel)oChemicalsoAgribusiness oCarbon black oMining oFerro ChemoWind & Solar poweroInsulatorsoTelecommunicationsoFinancial Services (Life Ins, Asset Management, NBFC etc)

oIT – ITeSoRetailoTrading

Our Flagship companies:


• We are a part of Aditya Birla Financial Services Group – with a vision to be the leader and role model in broad based and integrated financial services business.

• ABFSG businesses include life insurance, mutual fund, private equity, stock broking, distribution and financing besides insurance broking.

• Aditya Birla Insurance Brokers is a leading General Insurance and Reinsurance intermediary in India.

• Expected to place premium ~ INR 3,500 mn (US$ 70 mn) during FY12

• Headquartered in Mumbai, the Company also has offices in Delhi, Kolkata, Hyderabad, Pune, Bangalore, Chennai, Ahmadabad and Bhubaneswar – more are planned.

• More than 180 employees across India dedicated to service.

• Technical expertise in insurance, reinsurance and risk management.

About us

3 of X


Group approach to risk management - Domestic Business

• Domestic Business is placed through ABIBL, which arranges all necessary risk management initiatives & inputs through coordination with all stakeholders.

• Most of the large businesses have their own Risk management / safety departments to address their requirements

• Major Group companies are Metal (Hindalco), Cement (Ultra Tech), Fertilizers (Indo Gulf), Fibre and Chemicals (Grasim), Textiles, Telecommunications (Idea) & Financial Services

• Value at risk of Property Insured is ~ US$ 20 bn• Projects worth ~ US$ 6 bn are under construction• Tailor made Property All Risks policies are structured for Metals, Cement and Fertilizer

businesses• Other businesses are structured as per standard Industrial All Risk policy form• Property & Marine risk exposures are retainable in the Indian Insurance market• Consolidated program structured to Insure ‘Terrorism Risk’ which is reinsured in London Market• Under ‘Employee Benefits’ policies; 57,000 employees along with their dependents (Total lives –

233,000) are covered• EB program includes Health / Accident / Term Insurance policies• Annual Premium towards Property & Marine Insurance ~ US$ 18 mn

o Metal Business – US$ 10 mn; Cement Business – US$ 2.5 mn; Fertilizers – US$ 1 mn; Telecom –US$ 2 mn

• EB premium is ~ US$ 10 mn• Total domestic business premium ~ US$ 32 mn


Group approach to risk management - Overseas Business

• Metal Business – Hindalco - Novelis (1 smelter & 29 rolling mills / recycling units in 11 countries across 4 continents) Handled by Novelis through their Central Risk Management Department in Atlanta.

• Carbon Black Business – 5 different entities operating in 12 countries. It includes thelatest acquisition of Columbian Chemicals whose insurances are centrally arranged from Risk management department in USA. Insurances of other units in Thailand, China and Egypt are placed separately.

• Pulp & Fibre Business – Operating in 6 countries through different entities (4 pulp plants, 6 fibre plants in 6 countries)

• IT & BPO – Aditya Birla Minacs Worldwide Limited (present across 35 global centres in 8 countries) whose Insurances are independently managed from Minacs HQ’s at Toronto.

• Textile Business – Thailand, Indonesia, Philippines, Egypt – Insurances handled separately at the respective plant locations.

• Currently ABIBL is facilitating placement of textile, chemicals and carbon black businesses in South East Asian countries through reinsurance support from India


Overseas Business

Challenges

• Insurance & Risk management is carried out at each entity level• Phased integration of acquired entities• Compliance of Local regulatory requirements• Affinity towards existing relationship with underwriters & brokers• Worldwide presence & reach of ABIBL as a nodal agency

Way forward

• To play major role in arranging insurance covers for overseas units on ‘Business’ lines in a phased manner through corporate office involvement.

• Looking for global cover for Marine & Liability risks.• Look for uniform terms for property insurances of different business units

• To evaluate feasibility of developing a Global Insurance program• To evaluate feasibility of working with able partners in Underwriting & Broking

• HOW CAN LLOYDS HELP US IN THIS ENDEAVOUR – YOUR SUGGESTIONS


Thank You

X of X

vedanta

•K.S. Vishwanth, Risk Management and Insurance Consultant

46

Lloyd’s market visit to India

K.S.Vishwanath

Consultant-Insurance & Risk ManagementIndia Market Consultant for Dolphin Maritime & Aviation Services, LondonAuthor of Insuring Cargoes-A practical guide to the law and practice (Witherby UK)-2010 edition

#69,, "Whispering Winds" , Apartment No 303 (3rd Floor) ,6th Main, M.S.Ramaiah CityJ.P.Nagar 8th Phase, Bangalore-560 076

(Mobile) +91 99 8011 1662 (Email) [email protected]: marineinsurancebook.blogspot.com

47

Group overview – its local and the global reach

Group approach to risk management

Perspectives on current insurance programme and the future needs

Requirements and the challenges to cover Indian risks abroad –the legal, regulatory, and any other issues

48





49

VedantaA London listed FTSE 100 diversified metals and mining major.

© 2010, Vedanta Resources plc

Market capitalization of $11.5bn

London listing since 2003, #41 in the FTSE 100

Revenues / EBITDA for FY 2009 of $6.6bn / $1.6bn

Strong and liquid balance sheet, cash of c.$6.8bn (31/12/09)

Over 30,000 employees globally, including 8,000

professionals

Sterlite listed on the NYSE/BSE/NSE, market capitalization of

$15.3bn

Industry leading organic growth pipeline – half of capex

already spent

One of the World’s Largest Diversified Mining Companies-Global metals and mining player with a major presence in India

29%

17%

54%

47%

25%

7%

15%

6%

ZincCopperAluminum Power Iron ore

50

Delivering India’s mineral potential

Zinc-Lead-Silver: to become world’s largest integrated zinc player; top 10 producer of Sliver

Aluminium: to become top 10 producer

Copper 1.2+ mt refined copper– to become top 3 producer

− India: 800 kt custom smelting

− Zambia: 400+ kt fully integrated

Iron Ore: to become top 10 iron ore producer

Power: one of India’s largest power producers

Exploration-A Key Focus Area

51

Vedanta group companies

Konkola Copper Mines, Zambia-180kt integrated copper producing unitCopper Mines of Tasmania Pty Ltd, AustraliaAnglo American Group of Companies –Lisheen (Ireland) Skorpion and Black Mountain (South Africa)

Sterlite Energy, IndiaSesa Goa LtdSterlite Industries (India) LtdVedanta Aluminium Ltd Bharat Aluminium Ltd (BALCO)Hindustan Zinc LtdMadras Aluminium Ltd (MALCO)

Latest acquisition-Cairns Energy and Cluster Ltd, Liberia

Acquisition Philosophy-Vedanta adopts a very selective approach

52

Vedanta Group Structure

52

Zinc-IndiaCopperAluminium Iron ore Power

KEY

Konkola Copper

Mines (KCM)

54.6%

Vedanta Resources(Listed on LSE)

Madras Aluminium

(MALCO)

94.8%

51.0% 64.9%

70.5%

100%

29.5%

Zinc-India(HZL)(Listed on BSE

and NSE)

AustralianCopper Mines

Bharat Aluminium (BALCO)

Sterlite Energy

100%

Sterlite Industries(Listed on BSE, NSE and NYSE)

VedantaAluminium

(VAL)

79.4%

Sesa Goa (Listed on BSE

and NSE)

55.1%

3.6%

51%

Skorpion and Lisheen

Black Mountain

100% 74%

Zinc-International

Cairn India Ltd(Listed on BSE

and NSE)

38.8%

20.2%

Liberia Iron Ore Assets

Oil and Gas

53





54


Like many Indian Business Houses, Vedanta too is getting increasingly sophisticated in risk and risk management.

An Enterprise Risk Management exercise is planned in Feb 2012 -mining/smelter experts from Willis London coming to India for this purpose.

There is a management commitment to :

•Sustainable Development•Loss prevention

55


Contract Certainty in policies

A commitment to increase deductibles/time excess progressively–towards protecting balance sheet

Robust MIS

Enterprise Risk management

Focus on Sustainability

56





57


Mega Policies (insureds with sum insured of US$ 500 million are entitled to this package policy)-covers Property , Machinery B/D and Business Interruption. Mega policy provides an All Risks cover which is otherwise not allowed by the Regulators for property risks.

D&O-a Master Policy in London, local policies in various countries

POSI Covers

Emerging needs:

Political Risks for assets acquired –e.g. Liberia

Kidnap and Ransom cover

Mergers & Acquisitions-presently depending on London brokers

58

Emerging Risks/Requirements

1. If you are operating in emerging markets political risks including the risks of Nationalization are acute. The rise of entities like Boko Haram in Nigeria must be causing anxiety to promoters who have assets there.

2. Change in government polices- Indonesia recently brought in restrictions on the export of coal. Many companies invested in Indonesian coal mines.

3) Port Blockade

4) Blockade of a pit head, say in Angola, providing raw material to factories elsewhere may have to be addressed.

5) Global medical cover.

59





60


1. Lack of expertise within India of how to structure a global Property & Casualty programme

2. Restrictive wordings and complex File & Use guidelines which make it difficult to design a global property and casualty policy wording.

3. Lack of specialized experience in handling large Casualty programmes where layering becomes necessary. We do not presently have any excess casualty markets in India.

4. Lack of understanding of local conditions/regulations in countries where Indian MNC’s may have physical presence-consulting local legal experts entails cost.

5. Lack of understanding/expertise to underwrite suitable DIC/DIL terms and limits.

6. Lack of adequate NATCAT cover in jurisdictions where event limits are in force. Can the DIC/DIL out of India take care of this?

7. Excessive softness of the Indian market will make such global programmes unviable as the Indian Corporate has come to expect such unsustainable rates and deductibles. Where will the DIC/DIL be funded from?

61

Indian Insurance Industry-Service Delivery

Government Insurers (the four PSU’s) have a broad brush underwriting appetite-howeverservicing of customers continues to be a challenge

Cartelization-the four PSU’s do not compete with each other for “mega risks”

On the other hand, private Insurers often have underwriting appetite issues (e.g. mining industry) and/or capacity constraints to write businesses such as Vedanta Group

Writing a global programme out of India does not seem feasible in the near future.

62

Thank you

reliance general - lloyd's of london

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