annual report 2009-10 - IRDA

ANNUAL REPORT 2009-10insurers should be allowed time to stabilise operationsprior to taking up full scale inspection. Commencingfrom the current financial year, 2010-11, on-siteinspection targeted on critical issues in respect of fourlife insurers and four non-life insurers has beenundertaken. The Authority proposes to strengthen itsactivities in this critical area of its operations.Data Warehouse:34. The Authority has constituted the InsuranceInformation Bureau (IIB), an advisory body which iscollecting, processing and disseminating data. IIB hasbeen formed to ensure that the business data ofinsurance companies is collected and processed inan orderly manner and is made available at regularintervals. Hence, it is useful for the various marketplayers, researchers, policyholders as well as thepublic at large for real-time decision making. IIBfunctions as a single point official reference for theentire data requirement on the insurance sector. Allthe necessary decisions regarding processing anddissemination of data are being undertaken as perthe policy laid down by the Bureau. All non-life insurersare required to upload the insurance data on motor,health and other lines of business online as per thedata formats prescribed and provided by IRDA. Aspart of the initiative, aggregate level data for the nonlifeindustry as a whole is made available to theinsurers for making better underwriting decisions.Initiatives taken at Authority on Implementation ofIFRS:35. The Authority had constituted a Working Groupin October, 2008 to decide the road map forimplementation of International Financial ReportingStandards (IFRS). The Working Group had submittedits Report in June, 2009. The Report submitted by theGroup raised various issues which may emerge onimplementation of IFRS which is due for applicationto the insurance companies by 2012-13. The basicapproach adopted by the Authority is that it will not bean adoption of IFRS but it will be a convergence toIFRS.36. The Institute of Chartered Accountants of India(ICAI) has issued the exposure draft on InsuranceContracts in the form of IAS 39 which is yet to benotified as Accounting Standard by National AdvisoryCommittee on Accounting Standards (NACAS). In themeantime, IASB has issued exposure draft onInsurance Contracts. IAS 39 compliance is anintermediary step in moving forward to convergenceto IFRS.37. The Authority has recently constituted a WorkingGroup to address the issues in this situation. TheWorking Group consists of the officers of the Authorityand experts in the field of accounts and actuarial fromthe industry. The task of the Group is to examine theexposure draft on IAS 4 and various other issuesarising out of the implementation of IFRS.Performance in the first quarter of 2010-11:38. The life insurers underwrote new business of`25,522 crore during the first quarter in the currentfinancial year, 2010-11 as against `14,456 crore inthe corresponding first quarter in 2009-10, recordinggrowth of 76.55 per cent. Of the new businesspremium underwritten, LIC accounted for`18,740 crore (73.43 per cent market share) and theprivate insurers accounted for `6,782 crore (26.57 percent market share). The market share of these insurerswere 62.45 per cent and 37.55 per cent respectivelyin the corresponding period of 2009-10.The non-lifeinsurers underwrote a premium of `10,755 croreduring the first quarter of the current financial yearrecording a growth of 21.83 per cent over `8,827 croreunderwritten in the same period in 2009-10. Theprivate sector non-life insurers underwrote a premiumof `4,361 crore in April-June, 2010 as against`3,586 crore in April-June, 2009, reporting a growthof 21.61 per cent. The public sector non-life insurersunderwrote a premium of `6,391 crore which washigher by 21.88 per cent (`5,244 crore in the firstquarter of 2009-10). The market share of the publicand private insurers stood at 59.44 and 40.56 per centat the end of the quarter (59.36 and 40.64 at the endof June 2009).39. ECGC underwrote credit insurance of `208 croreas against `190 crore in the previous year, a growthof 9.66 per cent. AIC underwrote agricultural insuranceof `149 crore as against `132 crore in the previousyear, i.e., a growth of 12.84 per cent. The healthinsurers (Star Health, Apollo Munich and Max Bupa)underwrote premium of `364 crore as against `246crore in the previous year, reporting growth of 48.23per cent.7