After the Tata group’s takeover of Air India, New India Assurance has lost its tag of the airline’s “lead insurer” to a firm from the conglomerate.
New India Assurance had been the lead insurer for the account of Air India for decades. It lost the tag to Tata AIG General insurance — for the first time — during the recent renewal of Air India’s cover for 2023-24, despite significant hardening of the international reinsurance market.
Air India’s renewal premium has remained at $30 million, the same as last year.
“With a good track record, AI has managed to hold on to last year’s premium of $30 million for a policy of $10 billion, though the international aviation market has remained tough owing to the Russian invasion of Ukraine that has affected the aviation reinsurance market badly,” London market sources said.
Like all aviation insurance policies, the Air India policy, with a sum assured of $10 billion, is reinsurance driven and almost 95 per cent of the premium is passed on to global reinsurers who reinsure the cover. Though Tata AIG General Insurance is the lead insurer, the ultimate responsibility of paying any claims lies with the reinsurers.
Led by AIG, a clutch of global reinsurers, including India’s GIC Re, have reinsured the cover which is shared by a consortium of public and private domestic general insurers including New India Assurance, United India Insurance, Oriental Insurance Company and National Insurance Company, Tata AIG General Insurance and ICICI Lombard General Insurance.
