India's only reinsurance player GIC Re has asked state-owned large companies to adopt fair and level-playing business practices while seeking reinsurance covers.
The company, which is facing stiff competition from international reinsurers, has managed to bag reinsurance accounts of only a few large domestic companies like ONGC and BPCL.
"We are the reinsurer for the energy major ONGC on the basis of international competition. We can provide such reinsurance leadership to more accounts from the country, but we are unable to do so, since some of the large corporates are do not allow GIC Re to compete for their accounts on fair terms," GIC Re Chairman and Managing Director A K Roy told PTI.
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In fact, many state-owned companies are laying down certain clauses which bar GIC Re from bidding their accounts, he alleged.
"The real reason for us not being the lead reinsurer for many domestic companies other than ONGC is neither lack of capacity nor competition.
"It is simply because we are being prevented by them to have their account on technical grounds. Still, I can only tell you that if they come to us, they will get a cheaper rates compared to any other reinsurer. Our ONGC account could be a case in point. It will save the country a lot of forex," Roy said.
Some large corporates have been laying down certain 'artificial conditions' as eligibility criteria for bidding their reinsurance accounts, which act as barriers for GIC Re to compete with other global reinsurance majors, he said.
