Life Reinsurance – How the landscape is evolving

Transcript:Life Reinsurance – How the landscape is evolving:
Life Reinsurance – How the landscape is evolving and what future holds R. Srinivasa Rao Managing Director, Life & Health, Munich Re India 7th Seminar on Enterprise Risk Management Hotel Sea Princess 01 September 2023 Agenda Reinsurance Landscape Market Participants Reinsurance Solutions Pricing & Risk Management Operations & Data Management Issues to consider that may have a bearing on the future www.actuariesindia.org Market Participants Prior to Year 2000 Only Swiss Re and Munich Re were the two foreign reinsurers Reinsurers were valued for Product development, UW and Technical know-how 2000-2016 All major life reinsurers started participating in the market through their service company or Representative Office. Risk was written outside of India. Except for Liaising all aspects were dealt by the Cross Border Reinsurer Major share of market with Swiss Re, RGA and Munich Re GIC Re started participating in small measures 2017-2020 Reinsurance branch regulations; All prominent foreign reinsurers set up composite branch office (FRB) 2021 – current Some FRB reduce / withdraw capacity Cross Border Reinsurer participation increases (Sirius Point Re, Barrent Re etc) www.actuariesindia.org Reinsurance solutions Risk type Mainly mortality Critical illness in limited way Disability riders in a very small proportion RI structures- mainly proportional Reinsurance Started with quota share typically 60:40 Then moved to surplus / quota share or combination of both Group on Quota Share ; Individual on Surplus – INR 0.5m to 1 m retention CI on low surplus – INR 0.1 to 0.5 m 2013 regulations- only surplus – INR 2m to 3m retention Post 2022 – mix of Q/S and surplus – INR 4m to 10m retention Non Proportional – Catastrophe treaties www.actuariesindia.org Pricing & Risk Management Savings Business Aggregate rates close to published table with selection discount for Medically examined lives Age setback for females Profit commission based on the performance of the portfolio Non Medical which started in 2000 at INR 0.5-1.0 m today stands at INR 60-100 m (Some may go even up to INR 250m!!!); Differs by channel For term product Largely medically examined portfolio but Non Medical allowed for lower SA Separate rates for Medical / Non Medical with age setback for females Without profit arrangement New category of Tele Medicals got introduced Online – offline differentiation brought in (eventually all policies became online!!!) Non Medical / Tele limits upto INR 20-30m Surrogates used for Financial evidence www.actuariesindia.org Pricing & Risk Management 2010 – Online Term