Losses for public sector insurance companies in the pandemic have fallen compared to the pre-pandemic era

Despite the settlement of pandemic-related claims, the profitability of public sector insurance companies has improved

Public sector insurance companies suffered a total loss of Rs 3,450 crore during the period between April 2020 and September 2021, as 14.92 lakh of coronavirus pandemic related health claims worth of Rs 17,537 crore have been deposited with them till December 31, 2021.

According to Ministry of Finance sources, despite the burden of pandemic-related claims on public insurance companies, the Rs 3,450 crore losses they faced between April 2020 and September 2021 (when the first and second waves had swept the country), were less. than Rs 7,552 crore of losses these entities had faced during the pre-pandemic period (October 2018 and March 2020).

Consequently, the overall profitability of state-owned insurance entities recorded an improvement of Rs 4,101.34 crore during the initial one-and-a-half-year period of the pandemic, despite the absorption of the impact of the pandemic in terms of Covid-related claims, the sources advised.

Of the 14.92 lakh Covid health claims that have been filed with these public sector insurance companies till December 31, 2021, 93% of them have been cleared, they added.

During the period March 2020 to March 2022, i.e. two financial years 2020-21 and 2021-22, the government injected Rs 17,450 crore of capital into public sector insurance companies to improve their solvency ratios.

Of the four state-run general insurance companies, only the New India Assurance Company is publicly listed. The remaining three entities, namely Oriental Insurance Company Limited, National Insurance Company Limited and United India Insurance Company, are 100% state owned.

According to a PTI report citing sources, in the current financial year (2022-23), the government can infuse Rs 3,000-5,000 crore of additional capital into the three general insurance companies in the sector. audience based on their performance and needs during the year.

Kristan F. Talley