HomeFinance NewsThe world's oldest insurer has just slammed delay in raising FDI limit

The world's oldest insurer has just slammed delay in raising FDI limit

The chairman of Lloyd’s Global, the world’s oldest insurer, has criticised the Indian government for the delay in liberalising the sector but said he is hopeful of an eventual increase in the Foreign Direct Investment (FDI) limit.

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By Yash Jain  January 21, 2020, 5:25:31 PM IST (Updated)

The world's oldest insurer has just slammed delay in raising FDI limit
The chairman of Lloyd’s Global, the world’s oldest insurer, has criticised the Indian government for the delay in liberalising the sector but said he is hopeful of an eventual increase in the Foreign Direct Investment (FDI) limit.


The government had increased the FDI limit in the insurance broking and distribution space to 100 percent via automatic route but the limit for insurance underwriting space still remains at 49 percent.

Bruce Carnegie-Brown, Lloyd’s chairman stated that the Indian insurance market needs a lot more support in the form of foreign capital and he is hopeful that the government will move toward facilitating that required capital support.

However, despite the slower than expected liberalisation, the reinsurance major stated that the company is present in India for three years and hopes to stay here for another 300 years.

The Lloyd’s chairman said he is optimistic that many more of its syndicates are looking at entering the Indian market. Currently, Lloyd’s only has one syndicate operating in the Indian insurance market.

At Lloyd's, its members come together as syndicates to insure and spread risks of different businesses, groups, companies and individuals. Each of the syndicates are specialists in different types of risks and decide which type of risks would be insured by them.

When asked about the existing order of preference in reinsurance treaties, with state-owned GIC Re being given first preference, Carnegie-Brown said Lloyd’s is very keen on the removal of the order of preference and Right of First Refusal which favours GIC Re at the moment.

The order of preference given to GIC Re creates friction in the market place and creates in-efficiency, said Carnegie-Brown. He also added that the current reinsurance regulations create problems for third party capital to arrive with confidence in India.

The chairman of the reinsurance major said Lloyd’s feels that the government has taken steps to open up the insurance sector but the pace of it has been very slow.

The reinsurance major added that it's constantly working with the government to remove all the barriers coming in the way of the development of the Indian insurance and reinsurance market.
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