Progress of Miscellaneous Insurance after Nationalisation
The progress of Miscellaneous Insurance after Nationalisation has been analysed under (i) Gross premium, (ii) net premium and (iii) underwriting experiences.
1. Gross Premium in Miscellaneous Insurance :
The gross direct premium has increased from Rs. 114.00 crores in 1980 to Rs. 218.00 crores in 1980 and again to Rs. 610.18 crores in 1985 and Rs. 1302.16 crores in 1988-89. The miscellaneous insurance increased by 590.32 per cent during 1980 to 1988-89. The maximum amount of miscellaneous insurance has been Rs. 75.00 crores in 1980 and Rs. 424.86 crores in 1988-89 in New India. It has increase by 744.06 per cent.
The United India has increased its business from Rs. 47.60 crores in 1980 to Rs. 318.82 crores by 669.79 per cent. Oriental has increased its business by 701.56 per cent from Rs. 39.13 crores in 1980 to Rs. 274.52 crores in 1988-89. National has increased its business from Rs. 39.92 crores in 1982 to Rs. 234.41 crores in 1988-89 by 609.74 per cent.
It shows that New India having maximum amount of gross direct premium has increased its business at the highest rate followed by Oriental, United India and National. The higher amount of miscellaneous Insurance in New India and United India has been attributed to several non-traditional policies issued by them.
They have tried to attain the socio-economic objectives of the nationalisation. Oriental and National have been lagging behind. The GIC has no fixed trend. It deals only in aviation insurance which depends on the flights frequencies.
It has to compete with foreign companies. The gross direct premium amounted to Rs. 1367.69 crores in 1994-95; out of which the contribution of all companies was Rs. 119.51 crores by GIC, Rs. 536.72 crores by National, Rs. 878.89 crores by New India by India, Rs. 641.58 crores by Oriental and Rs. 707.70 crores by United India.
2. Net Premium :
The net premium of miscellaneous insurance has increases from Rs. 89.00 in 1973 to Rs. 207.90 crores in 1980 and again to Rs. 576.12 crores in 1980 and Rs. 1221.74 crores in 1988-89. It shows the rising trend of insurance business.
The net premium increased by 344.31 per cent from Rs. 354.84 crores in 1982 to Rs. 1221.74 crores in 1988-89. The net premium of GIC increased from Rs. 66.55 crores in 1982 to Rs. 239.77 crores in 1988-89 by 360,29 per cent.
National Insurance has increased its net premium from Rs. 52.26 crores in 1982 to Rs. 188.26 crores in 1988-89 by 360.24 per cent. New India increased from Rs. 103.60 crores to Rs. 337.99 crores by 326.25 per cent during 1982 to 1988-89.
Oriental increased its net premium by 368.11 per cent from Rs. 57.55 crores in the corresponding period. United India has increased from Rs. 74.88 crores to Rs. 243.87 crores by 325.68 per cent during the period. Oriental increased its business at faster rate followed by National, New India and United India.
The net amount has been the highest in New India followed by United India, Oriental and National. The net premium was Rs. 2811.89 crores in 1994- 95. The highest net premium was Rs. 804.27 crores by New India and the lowest was Rs. 428.04 crores by National.
3. Underwriting Progress Experiences :
The underwriting experience has shown negative result. The underwriting loss has increased from Rs. 4.33 crores, in 1982 to Rs. 40.77 Crores in 1985 and Rs. 296.12 crores in 1988-89. The underwriting loss to net premium has gone up from 1.2 per cent in 1982 to 7.1 per cent in 1985 and again to 24.4 per cent.
The maximum loss ratio has been in the case of United India i.e., 26.4 per cent in 1988-89, 11.6 per cent in 1985 and 2.2 per cent in 1982. The reason has been the highest claims ratio ranging from 69.4 per cent to 96.7 per cent.
However, the expense-ratio has been the lowest of all the companies in 1988-89. Oriental has the second largest loss followed by New India and National.
The underwriting experience has shown that National and New India have experienced less loss-ratio because of less claims ratio. Underwriting experience in 1994-95 has revealed loss of Rs. 209.91 crores. All companies have incurred loss in 1994-95.