In his welcome address at the 2nd IFSCA-IRDAI GIFT IFSC Global Reinsurance Summit, International Financial Services Centres Authority (IFSCA) executive director Praveen Trivedi, said that setting up businesses in India has been gaining notable traction in the past period thanks to the regulatory effort which focused more on enhancing ease of doing business. Mr Trivedi said that it is a positive sign that the 2nd edition of the Summit is attracting guests from all around the world representing various insurance, reinsurance and insurance-related entities as well as regulators and other industry professionals.
Insuring India by 2047, which is a new landscape for the insurance sector opens the door wide for the insurance and reinsurance industry to tap into the great potential in the country, said Insurance Regulatory and Development Authority of India whole time member (Actuary) P K Arora.
He said that India’s 2047 ambitious vision is for individuals to have proper life insurance coverage, families to enjoy suitable health insurance and for businesses to be protected against various risks, especially those prone to natural catastrophes. All this requires offering adequate and affordable products, he said. Mr Arora noted that with a premium income of $143bn (76% of which coming from life insurance business), India is one of the largest and fastest growing insurance markets in the world.
Mr Arora said that India’s fast economic growth along with the country’s young population offers opportunities for the (re)insurance industry to grow and prosper. He added that because of the recent regulatory developments, it has become easier to set up businesses in India, which was reflected in seeing new ventures in the market in recent years.
The past decade has witnessed interesting reforms which have led to creating a much healthier financial business environment and provided positive signs for investors in India, said IFSCA chairperson K Rajaraman.
He added that the financial inclusion reform was amongst the most important reforms the country has witnessed in the past ten years. He said that reforms and renovation of regulation are among the growth pillars for the future, yet, technology and human resources remain an essential pillar for growth.
Mr Rajaraman called the insurance industry to take advantage of the 35m Indian diaspora population through designing proper products for them. He also recommended growing certain sectors such as the aviation insurance. He also promised to facilitate the IFSC platform for insurance and reinsurance companies to invest in the region.
Making India an international reinsurance hub and making insurance for all people by 2047 are two main guiding principles for the regulatory authorities and the insurance industry to work on, said Insurance Regulatory and Development Authority of India general manager Shardul Admane.
GIFT scenario is around creating a financial centre with the Indian ecosystem reflecting the onshore system, said International Financial Services Centres Authority executive director Dipesh Shah. He noted that the GIFT has introduced several encouraging jurisdictions and financial incentives that acted as a game-changer which was translated in seeing sizable number of Indian and foreign institutions setting up business there.
He pointed out that the number insurance entities has grown from 16 in 2020 to 41 by the end of 2024, while (re)insurance GWP booked by insurance offices jumped from $45m to $504m.
Reinsurance and regulatory regimes
The reinsurance industry is a very good position to create a reliable hub in India, said speakers at the panel discussion ‘Exploring reinsurance avenues and regulatory regime at GIFT-IFSC’.
Ease of doing business in addition to the massive growth opportunities the Indian insurance industry offer should be major elements in the development of the GIFT business, said GIC Re chairman & managing director Ramaswamy Narayanan. Yet, he reiterated his calls for insurers to preserve a healthy business performance for the industry to grow on sound basis.
On how to make the country a reinsurance hub, Swiss Re India CEO Amitabh Ray said that in addition to the aggregation of all risks, free marketplace conditions and flexibility are to be demonstrated. Additionally, the talent is another propellor.
Looking at a gradual means of building a reinsurance hub could be an option to consider said Berkley Insurance Asia CEO Shasi Nair. He said that India has the necessary expertise and proven track record success in fields such as agriculture, captives and cyber, which can form a beginning for building a (re)insurance hub.
Connectivity, the scale of the Indian insurance industry plus its neighbouring markets, altogether represent a strong motive for companies to set up business in the GIFT, said Peak Re CEO Franz Josef Hahn.