Fire insurance business of non-life insurers grew at a slower pace in the pandemic-hit fiscal. According to the data filed by the insurance regulator, gross premium underwritten for fire covers jumped 28.06% to Rs. 20,139 crore in the year ended March, 2021. But growth slowed from 34.8% in the previous fiscal.
For private insurers, fire segment grew 34.38% to Rs. 11,737 crore; for their public sector peers it rose 20.16% to Rs. 8,402 crore. This increase could be primarily attributed to upward revision in the rates by Insurance Information Bureau.
Fire insurance segment which includes fire and allied perils including lightning, storm, flood, earthquake, explosion, was plagued by discounting. The insurers charged lower premiums to retain corporate clients despite paying higher claims in the previous year. But after revision in rates, insurers selling policies to GIC Re, India’s sole reinsurer, had to pass on higher costs to consumers.