GIC celebrated its first anniversary
For the successful completion of its first year of operations, General Insurance Corporation (GIC) Bhutan Re Ltd, the first reinsurance company of the country, the Joint Venture (JV) Reinsurance Company partnering with General Insurance Corporation of India (wholly owned by the Government of India) celebrated its first anniversary last Friday.
The Chief Guest at the ceremony the Minister of Home and Cultural Affairs , Lyonpo Damcho Dorji said, even from its first year of its business, the company is doing very well and the future prospects of the company looks very promising
Lyonpo further said, our government is in its second year of governance and I am confident that many would be aware of the many related schemes initiated by the Govern- ment to develop the economy and encourage all to engage in productive ventures. We are also aware of the importance of the benefits of insurance and looking at all possibilities of making insurance a priority.
Lyonpo said, the recent decision to increase the Group Insurance cum Saving Scheme premium and likewise the insurance coverage is a step towards it. The unfortunate fire incident of one of our sacred heritage (Wangduephordang Dzong) has taught us a hard lesson and realising that Bhutan lies in high seismic prone zone gives us all the more reason.
Reinsurance Companies, as the reinsurer of insurance companies, play a vital role in ensuring that the insurance companies are adequately protected so that they can in turn provide adequate risk cover for all types of risk to the general public. Insurance companies will take risk only when they have solace in the fact that they are protected in case of unfortunate and unforeseen calamities. Taking prudent and calculated risk is necessary for any business to grow, he added.
The promoter, Dasho Sangay Wangchuk said, the concept of insurance and the need for it in the country was envisioned by our beloved King, The fourth Druk Gyalpo, His Majesty Jigme Singye Wangchuck and His Majesty commanded the establishment of the Royal Insurance Corporation of Bhutan under the Royal Charter on 7th January 1975 to cater to the insurance needs of the people.
Despite the limited understanding of insurance, insurance market has grown in the country and hence it was in 2009 that another insurance company (Bhutan Insurance Limited) was approved to be opened to offer competitive products and services. The two insurance companies now write substantial business totalling gross premium of around Nu. 100 cores, said the promoter.
To increase risk appetite and enhance capacity within the country, the need for the establishment of Reinsurance Company was thought off and hence the undersigned with the partners started exploring options and avenues for a partnership to start a Joint Venture Reinsurance Company, he added.
He further said that they had started to get into negotiation with General Insurance Corporation of India thereafter and their Joint Venture agreement finally materialized on 5th July 2012. This company was officially incorporated under the Companies Act of the Kingdom of Bhutan 2000 on 16th May 2013. Pursuant to Chapter 3 of the Financial Services Act of Bhutan 2011, GIC- Bhutan Re was licensed by the Royal Monetary Authority of Bhutan, as a General Reinsurance Company to engage in general reinsurance business on 13th August 2013.
The Indian Prime Minister, Shri Narendra Modi chose Bhutan as his first port of call soon after taking over as Prime Minister of India. In his statement at recent state to Bhutan, emphasized the importance of further developing and strengthening bilateral relations between India and its neighbors.
In this direction, the department of financial services has already taken two major steps in the form of Druk PNB JV and GIC bhutan Re, the two joint ventures that are already up and running.
Mr. Anshok Kumar Roy, Chair man cum Managing Director of GIC Re stated that GIC Re is one of the major reinsurer on the global horizon with standard and poor‘s ranking of 15th.. It operates through its JV in Bhutan, a fully owned subsidiary in South Africa, branch office s in London, Dubai, Kuala Lumpur and representative office in Moscow.
The Reinsurance JV is a symbol of our commitment towards developing the financial and economic relationship amongst the neighboring countries. More investment by India would enhance its risk appetite to retain larger risks within the country thereby conserving valuable foreign exchange.
Meanwhile, the Reinsurance has from the very beginning been instrumental in promoting regional support and cooperation in the insurance sector.