Fierce competition but also great opportunity in Europe

It is targeting a top 10 reinsurance spot on a global basis but GIC Re understands that, especially in continental Europe, reinsurance is a long-term relationship-driven game. Lucky then that the Indian company is itself a long-haul player and will be patiently awaiting any opportunities, says Alice Vaidyan, chairman-cum-managing director of GIC Re.

What are GIC Re’s ambitions for expansion in Europe now? Will you consider new offices and targeting certain countries in particular?

Europe has always been a territory of immense importance for GIC Re. We already have a strong presence in countries such as France and Germany through business relationships with the existing players there. We also source a significant amount of our international premiums from Europe. Going forward, we would like to see ourselves more involved in Spain and Portugal and also in East European countries, since we see enormous potential in these regions.


How will the UK’s vote to leave the EU potentially affect your strategy?

The implications of UK’s exit from the EU for GIC Re are not perfectly lucid since the details are still being worked out. However, as one of the responses to the challenges posed by the exit, we may look at establishing an additional office in Continental Europe itself.


What are the main challenges of seeking growth in Europe?

Europe is a traditional market where long-term relationships are cherished. The established players such as Munich Re, Swiss Re and SCOR are well ensconced and have a deep understanding of European market practices. Since we are relatively new in Europe, we will need to spend more time in interacting with various stakeholders and demonstrating our capabilities to the European market.


How do you overcome the traditions in this market and win market share from large incumbent players?

GIC Re is a long-haul player and will be patiently awaiting any opportunities that may arise as markets consolidate across the region. Currently, we are offering our lines across several different classes of business, such as agriculture, marine, liability, facilities, energy & after the event cover, inter alia, to our cedants as a mark of our solidarity with them.

The prime consideration for GIC Re is to be present by our cedants’ side when they require us the most. We are their partners and will continue to be so.


What is your timeframe now on becoming a top 10 player globally?

Breaking into the top 10 list has always been an actionable objective for GIC Re. We have been operating in the reinsurance space for only the last 16 years and managed to attain the 14th rank in this relatively short span of time. Considering our rapid growth in the Indian and Afro-Asian markets, we expect to become a global top 10 player soon.  


What sets GIC Re apart from other reinsurers globally?

GIC Re is a well-capitalised reinsurer with deep knowledge and understanding of the Indian and Asian markets. Our technical expertise enables us to develop customised reinsurance solutions for every market and support the local insurers regardless of the prevailing market conditions.

In addition, we are a central government-owned company, backed by a sovereign guarantee which instils immense confidence in our business partners across the globe.


What is your view on market conditions are the moment? Is anything likely to change?

The market is currently witnessing relatively soft market conditions, with availability of excess capital. There is immense competition among all the players in the market with pricing being the determining factor in the placement of reinsurance programmes.

Apart from some localised events, we have not seen any large scale natural catastrophes affecting multiple geographies, which would have led to huge claims and a concomitant hardening of rates. This soft phase of the insurance cycle is expected to continue.

Alice Vaidyan is the chairman-cum-managing director of GIC Re. She can be contacted at: alice.vaidyan@gicofindia.com