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Terrorism Risk Insurance Premium Cut of 10-15% in India

24 March 20251 min read
BANKING & FINANCETerrorism RiskInsurancePremium Cut of10-15% in India24 March 2025safalsetu.com

Why in the news

Rates of the terrorism risk pool are being reduced, making property cover with terror protection cheaper from 1 April; IRDAI approved.

About the pool

  • Formed on 1 April 2002 after reinsurers quit the segment post 9/11; run by GIC Re; all non-life insurers join.
  • Covers terrorism under property policies, including homes and fixed assets.
  • Limit per location: ₹200 crore initially, now ₹2,000 crore.

Why rates fall

  • Rates unchanged since 1 April 2014 and no major terror claims since the 2008 Mumbai attacks.
  • Revised rates include up to 5% brokerage or commission.
FY24 pool dataAmount
Premium income₹1,654.63 crore (FY23: ₹1,809.01 crore)
Claims paid₹3.12 crore

Impact

  • Lower costs for policyholders; large corporates may still use international reinsurers.

Exam angle

  • GIC Re runs the pool; limit ₹2,000 crore per location.

Test yourself

1. India's terrorism risk insurance pool is administered by which entity?

The pool was set up in 2002 and is administered by GIC Re.

2. What is the current indemnity limit per location under India's terrorism risk insurance pool?

The limit rose from ₹200 crore to ₹2,000 crore per location.

3. From which date did terrorism risk pool rates remain unchanged before the current revision?

Rates had remained unchanged since 1 April 2014.

This topic is part of Daily Current Affairs 23 & 24 March 2025 (28 topics).

All topics of the dayDay quizMarch 2025

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