The European federation of insurance companies, “Insurance Europe”, has accused the Indian reinsurance market of protectionism. The institution, which represents companies accounting for 95% of the European market premiums, is pointing to the Law of March 12, 2015. The latter compels local insurers to reinsure part of their business with Indian reinsurers, a practice deemed to be discriminatory against foreign players.
For Europeans, this measure is likely to hinder access to the local market and stands as an impediment to the development of their business. Insurance Europe has also pointed out that the absence of a policy of openness will result in a concentration of risks that are likely to trigger hardships to the market in the event of a large-scale incident.
Such accusations have been rebutted by national reinsurer, GIC Re, which says that risk retention level remains proportional to market capacity.
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