India motor pool to appoint chief

In an effort to improve claims management, the India Motor Insurance Pool (IMIP) is expected to restructure with a newly- appointed chief executive.

The Insurance Regulatory and Development Authority (IRDA) has decided to have a review meeting with all non-life insurers in the country of the IMIP, created by the four public and eight private sector general insurers, which have taken over all third-party motor liability risks. The meeting will take place towards the end of the week. Among the issues to be discussed is the conversion of IMIP into a separate organisation for managing the motor third- party underwriting business of all its members

A new chief executive for IMIP is expected to be appointed to manage the newly structured pool. The potential and name of that candidate is still not clarified by IRDA officials.

It is being observed that few insurers are opposed to IMIP, the reason being most of the private-sector insurers are now chasing third- party motor insurance business. The risks being spread among all the 12 insurance companies seems to be a good way out, implying that balance-sheet losses would be minimal.

Underwriting losses until the end of fiscal year 2006-07 aggregated to Rs40bn ($975m) for the four state-run insurers, almost entirely on account of motor third-party risk. For all four companies the investment income during the same period was Rs. 55 bn