GIC Re set to participate in reinsuring Kudankulam units

GIC Re will be participating in reinsuring the Rs 43,200-crore insurance coverage of the under-construction units of Kudankulam nuclear power plant. It has quoted a 15 % share of the risk, a source said.

But GIC Re’s quote is not the lowest as a global reinsurer has quoted a lower price. Also, there could be a 10 % shortfall in commensurate premium for the state-owned reinsurer. “There is this power plant for which GIC Re had quoted. Somebody else has also quoted and eventually the final rate will prevail and everyone will participate. No reinsurer takes 100 % of the risk,” the source said. “With New India Assurance and nuclear power plant involved, GIC Re cannot say no to coverage,” he further said.

The negotiations for placement of risk have not yet taken place and are likely to happen soon, the source added.

The erection-all risk cover for unit 3 and 4 of the nuclear plant is one of the biggest insurance coverages and will have multiple reinsurance players quoting for some portion of the risk.

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