life insurance: Life insurers seek a fix on Covid 3.0 impact

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In FY21, as per data from the Reserve Bank of India’s Financial Stability Report, the claims paid ratio (provisional) stood at 98.1 per cent for individual claims and 98.6 per cent in the group category in comparison with 96.8 per cent and 97.3 per cent, respectively, for the previous financial year.

Synopsis

A sudden spurt in Covid-19 cases in countries such Israel and the United Kingdom, being seen by experts as a beginning of a possible global third wave, has created uncertainties among insurers on the extent of provisions to be made for a sudden increase in claims burden as seen during the second wave between April and June, according to industry insiders.

Mumbai: India’s life insurance sector is assessing possibilities of increasing Covid-19 specific provisions in FY22 to protect solvency margins in the event of a likely third wave as the impact of the second incidence exceeded their risk model estimates.

A sudden spurt in Covid-19 cases in countries such Israel and the United Kingdom, being seen by experts as a beginning of a possible global third wave, has created uncertainties among insurers

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