To the Members,
The Directors have pleasure in presenting the Fifty-first Annual Report on the working
and affairs of the Corporation along with the audited statements of account for the year
ended 31st March 2023.
FINANCIAL RESULTS:
The highlights of the financial results for the year under review are as under:
(' in Crore)
Particulars |
2022-23 |
2021-22 |
1. Gross premium |
36,591.59 |
43,208.46 |
2. Net Premium |
33,644.43 |
38,799.03 |
3. Net Earned Premium |
35,808.01 |
39,293.40 |
Net Incurred Claims 4. |
32,739.38 |
36,625.85 |
% to Earned Premium |
91.4 % |
93.21% |
5 Net Commission |
5,610.51 |
6,950.82 |
% to Earned Premium |
15.7 % |
17.69% |
6. Operating Expenses and Other Outgo less Other Income |
(191.97) |
(30.13) |
7. Investment Income Apportioned to Revenue less expenses |
7,520.37 |
7362.75 |
8. Premium Deficiency |
(8.54) |
12.98 |
9. Total Profit/(Loss) (3+7-4-5-6-8) |
5,179.00 |
3,096.64 |
10. Transfer to Catastrophe Reserve |
512.55 |
0.00 |
11. Interest, Dividends & Rents (net) and Profit on sale of
Investments |
3,073.62 |
2,199.53 |
12. Other Income less Other Outgo |
419.60 |
90.41 |
13 Reserve for Doubtful Debts and Investment including Amortization of
Investments Written off and diminution in the value of investments written off |
410.23 |
1,826.45 |
14. Profit before Tax (9+11+12-10-13) |
7,749.44 |
3,560.14 |
15. Provision for tax including deferred taxes |
1,436.94 |
1,554.40 |
16. Profit after Tax (14-15) |
6,312.50 |
2,005.74 |
(Net Earned Premium is arrived after adjustments for Reserve for Unexpired Risks)
(Percentages relate to the net earned premium of the corresponding year)
(Obligatory sessions from Domestic Insurance Companies reduced from 10% to 5% w.e.f.
01.04.13 vide IRDA/NL/RI/41/2012-13 dated 3rd March 2013 and is further reduced from 5% to
4% w.e.f01.04.2022 vide IRDA/R/1/180/2022 dated 10.01.2022)
DIVIDEND & DIVIDEND DISTRIBUTION POLICY
The Board of Directors at its meeting held on 25th May 2023, recommended the payment of
dividend of Rs. 7.20 per share of Face Value of Rs. 5/- each (i.e. 144 % of paid-up equity
share capital) for the FY 2022-23 as against dividend of Rs. 2.25 per share for FY
2021-22.
In accordance with the Regulation 43A of Securities and Exchange Board of India
(Listing Obligations and Disclosure Requirements) Regulations, 2015 (the Listing
Regulations), the Corporation has formulated a dividend distribution policy and the same
is available on the website of the Corporation at https://www.gicre.in/images/pdf/Dividend
Distribution policy- 2022 Ver 20.pdf
CAPITAL AND FUNDS
Capital and Funds of the Corporation stood at ' 111,523.23 Crore as on 31st March 2023
as against ' 106,249.72 Crore in the previous year as per details given below:
(Rs crore)
Particulars |
As on 31.03.2023 |
As on 31.03.2022 |
Shareholders' Funds |
32,356.08 |
24,439.72 |
Policyholders' Funds |
79,167.15 |
81,810.00 |
Total Funds |
111,523.23 |
106,249.72 |
Note: As per the Regulatory norms, Shareholders' funds as on 31.03.2023 also include
Foreign currency translation reserve.
ASSETS
Total assets of the Corporation were Rs. 1,57,124.60 Crore as on 31st March 2023 as
compared to Rs. 1,44,887.37 Crore as on 31st March 2022.
CONSOLIDATED FINANCIAL STATEMENT
As per the provision of Section 129 (2) of the Companies Act, 2013, at every Annual
General Meeting of a company, the Board of Directors of the company shall lay before such
meeting financial statements for the financial year. Section 129 (3) of the Companies Act,
2013 provides that where a company has one or more subsidiaries, it shall, in addition to
financial statements provided under sub-section (2) of Section 129, prepare a consolidated
financial statements of the company and of all the subsidiaries in the same form and
manner as that of its own which shall also be laid before the Annual General Meeting of
the company along with the laying of its financial statements under sub-section (2) of
Section 129.
Explanation:
The Corporation is preparing Consolidated Financial Statements as it has three
subsidiaries namely GIC Re South Africa Limited, GIC Re, India, Corporate Member Limited,
UK and GIC Perestrakhovanie LLC, Moscow apart from three Associate Companies namely,
Agriculture Insurance Company of India Ltd. (AICIL), India International Insurance Pte.
Ltd., Singapore and GIC Bhutan Re Ltd.
FINANCIAL RATING AND RANKING
AM Best has revised the Long-Term Issuer Credit Rating (Long-Term ICR) outlook to
negative from stable and affirmed the Financial Strength Rating (FSR) of B++ (Good) and
the Long-Term ICR of "bbb+" (Good) of General Insurance Corporation of India
(GIC Re). The outlook of the FSR is stable.
The Credit Ratings (ratings) reflect GIC Re's balance sheet strength, which AM Best
assesses as strong, as well as its adequate operating performance, favourable business
profile and appropriate enterprise risk management (ERM). In addition, the ratings factor
in a neutral impact from the company's ultimate majority ownership by the Government of
India.
The revision of the Long-Term ICR outlook to negative from stable reflects AM Best's
view of increasing pressure on GIC's Re's ERM assessment. In fiscal year 2022, the
company's financial accounts have been subject to a qualified audit opinion in respect of
the reconciliation of receivables and payables, indicating deficiencies in internal
financial controls. In addition, whilst management has taken action to strengthen the
company's ERM framework over recent years, the company's risk culture and governance are
viewed to be evolving at this stage.
CARE Ratings Ltd. has reaffirmed 'AAA (Is)' Issuer Rating for the Corporation in
January 2023 with a stable outlook. The rating reflects GIC Re's strategic importance as
the dominant Indian reinsurer. The rating also factors in its experienced management,
diversified business profile and comfortable liquidity and solvency position.
SOLVENCY RATIO
The Solvency Margin of the Corporation as on 31st March 2023 stood at 2.61 as against
1.96 in the previous year.
INVESTMENTS
The book value of the investment of the Corporation in India (representing investment,
loans & deposits) amount to Rs. 86,175.41 Crore as against Rs. 77,348.78 Crore in the
previous year. The Investment income of Rs. 9,968.33 Crore were apportioned to
Policyholders & Shareholders as under:
(Rs in Crore)
Particulars |
2022-23 |
2021-22 |
Apportioned to Policyholders (PH) |
7,076.52 |
6,992.61 |
Apportioned to Shareholders (SH) |
2,891.81 |
2,370.82 |
* Ratio of PH/SH - 70.99/29.01
The mean yield on funds with profit on sale of investments stood at 12.19% (Previous
year 12.81%). The percentage of net NPA (Non-performing Assets) to Gross loan assets
(including Government Securities) was 0.02% (Previous year - NIL).
INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY OF INDIA (IRDAI)
The Corporation being a Reinsurance Company, its working and functions, are governed by
the Insurance Regulatory and Development Authority of India (IRDAI). The Corporation's
existing paid-up equity capital of Rs. 877.20 Crore conforms to the specifications of the
IRDAI. The Accounts of the Corporation are drawn up according to the stipulations
prescribed in the IRDAI (Preparation of Financial Statements and Auditor's Report)
Regulations, 2002.
IRDAI has identified the Corporation as a Domestic Systemically Important Insurer
(D-SII) for 2022-23 as per the framework put in place for identification & monitoring
of the operations of Domestic Systemically Important Insurers.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The provisions of Section 186(4) of the Companies Act, 2013 requiring disclosure in the
financial statements of the full particulars of the loans given, investment made or
guarantee given or security provided and the purpose for which the loan or guarantee or
security are proposed to be utilised by the recipient of the loan or guarantee or security
are not applicable to the Corporation.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS
IMPACTING THE GOING CONCERN STATUS OF THE COMPANY AND ITS FUTURE OPERATIONS
There are no significant and/or material orders passed by the Regulators or Courts or
Tribunals impacting the going concern status of future operations of the Corporation.
ENTERPRISE RISK MANAGEMENT (ERM)
The Corporation has in place a robust ERM policy. The policy defines a Governance
structure as well as the roles and responsibilities at each level. The ERM department is
headed by the Chief Risk Officer (CRO) who reports to the Board Risk Management Committee
through the Chairman cum Managing Director (CMD) and Management-level ERM committee.
ERM department conducts risk assessment with the assistance of the Risk and Mitigation
Plan Owners (RMOs), primarily Scale V level officers, where new risks are brought for
discussion and thereafter the entire risk universe is re-calibrated with the objective of
prioritization for mitigation. During the exercise, RMOs also propose controls/ mitigation
plans, which post deliberations are implemented. The ERM department conducts periodic
review of the risk universe and checks the control effectiveness. ERM Department informs
these developments and deviations to the Management and Board Risk Management Committee.
As part of its allied activities, the ERM department reviews the Business Continuity
Plan (BCP) and Business Impact assessment (BIA) which aims at providing continuity of
services at a defined minimum acceptable level of critical functions and to safeguard the
financial, competitive and reputational position in the short and medium term.
During the year under review, a neutral Third-Party Consultant was appointed for
carrying out the Stress test exercise of the Corporation. The annual Stress test exercise
was carried out for the financial Year 2022-23 based on financial data as on 31st March
2022. The Stress Test Exercise evaluated scenarios of significant adverse threats to the
future financial condition and found it to be adequately resilient. The Stress Test Report
was presented to the Board and subsequently shared with IRDAI.
The Standard Operating Procedures (SOP) is already in place for two key functions of
the Corporation viz: Reinsurance and Investment and their related accounting activities
and the same are modified on need basis, as per user department requests with the approval
of the Corporation's Enterprise Risk Management Committee.
An Anti-Fraud Policy framed by GIC which covers prevention, identification,
investigation and reporting of frauds is reviewed every year. Corporation has declared
'Zero Tolerance' to any non-compliance to the terms and conditions of the Anti-Fraud
policy. ERM department, as part of compliance, files the Fraud Monitoring Returns with the
Regulator.
The Corporation has put in place a Board approved Risk Appetite Statement which
provides a comprehensive summary of Risk Appetite parameters guiding the operations of the
Corporation. To ensure an appropriate level of capital at all times, the Board approved
Capital Management Plan has been put in place.
During the year under review, as part of BCP, a Drill was conducted at an Alternate
Site (GIC Gift City, Gandhinagar, Gujarat), so as to create awareness, ensure preparedness
among the Critical Resource Team and other Business Continuity Teams in times of
emergency. The BCP is shared with all employees for awareness on the procedures involved
in the recovery of operations.
CORPORATE SOCIAL RESPONSIBILITY (CSR) REPORTING
The Corporation is having a Corporate Social Responsibility Policy (CSR Policy)
indicating the activities to be undertaken by the Corporation, which has been approved by
the Board.
The CSR Policy may be accessed on the Corporation's website at the link:
https://www.gicre.in/images/pdf/CSR policy version 7 new.pdf The CSR Reporting as per
Section 135 of the Companies Act, 2013 given in Annexure I.
PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARIES, JOINT VENTURES AND ASSOCIATES
Pursuant to Section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies
(Accounts) Rules, 2014, a separate statement containing salient features of the Financial
Statements of Subsidiary, Associate and Joint Venture Companies in Form AOC-1 forms part
of the Directors' Report for the financial year 2022-23 as Annexure II and the
details on their performance & financial position are given in Management Discussion
& Analysis Report.
Further, in terms of proviso to Section 136(1) of the Companies Act, 2013 and
Regulation 46 of the Listing Regulations, 2015, the Corporation will place separate
audited Financial Statements in respect of each of its Subsidiary Company on its website
and also provide a copy to any Shareholder of the Corporation who seeks the same. The
Financial Statements of the Subsidiary Companies will also be kept open for inspection at
the registered offices of the Corporation/ the respective Subsidiary Companies.
AUDITORS AND AUDIT REPORT STATUTORY AUDITORS
M/s D. R. Mohnot & Co., Chartered Accountants and M/s. P K F Sridhar &
Santhanam LLP, Chartered Accountants were appointed as Joint Statutory Auditors to audit
the accounts of the Corporation for the financial year 2022-23 by the Comptroller &
Auditor General of India under Section 139 and Section 143 of the Companies Act, 2013.
The Joint Statutory Auditors have issued Auditor's Report.
SECRETARIAL AUDIT
The Board has reappointed M/s. Ragini Chokshi & Co., Company Secretaries to conduct
Secretarial Audit for the financial year 2022-23.
The Secretarial Audit Report does not contain any qualification, reservation or adverse
remark except that Pursuant to Regulation 17(1) (a) of SEBI (LODR), 2015, the Corporation
could not comply with the requirement of having at least one Woman Director on the Board
w.e.f. 3rd June 2022 to 4th September 2022 and Pursuant to Regulation 17(1)(c) of SEBI
(LODR), 2015, the Corporation could not comply with the requirements of having not less
than six directors on the Board w.e.f. 3rd June 2022 to 4th September 2022
Pursuant to Section 204 of the Companies Act, 2013, the Secretarial Audit Report of the
Corporation is given in Annexure III.
ANNUAL RETURN
Pursuant to Section 92(3) read with Section 134(3)(a) of the Companies Act, 2013, a
copy of the Annual Return for the year ended 31st March 2023, with the information
available up to the date of this report, is placed on the website of the Corporation at
https://www.gicre.in/en/investors-public-disclosures/investors-en/financial-performance/annual-return
and shall be further updated as soon as possible but no later than sixty days from the
date of the Annual General Meeting.
COMPLIANCE CERTIFICATE ON CORPORATE GOVERNANCE
The Corporation has annexed to this report Annexure IV, a certificate obtained
from the Practicing Company Secretary regarding compliance of conditions of Corporate
Governance as stipulated in SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015.
MANAGEMENT DISCUSSION & ANALYSIS REPORT
The operations and future prospects of the Corporation are dealt in the Management
Discussion and Analysis Report which forms part of the Directors' Report.
FOREIGN EXCHANGE EARNINGS & OUTGO AND OTHER INFORMATION
The particulars of Foreign Exchange earnings/outgo as required by the Companies
(Accounts) Rules, 2014 is given below:
i) Earnings Rs. 3,037.37 Crore
ii) Outgo Rs. 4,867.14 Crore
The earnings included all receipts denominated in foreign currencies in respect of
premium, recovery of claims, outward commission, and investment earnings but excluding
interbank transfers.
The outgo comprised all payments in foreign currency in respect of outward premium,
claims on reinsurance accepted, commission and expenses of management (bank charges) but
excluding interbank transfers.
Expenses on (a) Entertainment (b) Foreign Tours and (c) Publicity and Advertisement
amounted to Rs. 1,707,576.29, Rs. 1,41,10,683.73 and Rs. 6,04,09,143.34 respectively for
the year under review.
CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION
The Corporation is not engaged in any manufacturing activity and as such there are no
particulars to disclose under the Companies (Accounts) Rules, 2014 as regards Conservation
of Energy or Technology Absorption.
PERSONNEL AND INDUSTRIAL RELATIONS
I. Staff position as on 31st March 2023
Class I |
- Officers |
406 |
Class III |
- Clerical Staff |
43 |
TOTAL |
- |
449 |
II. Composition of Scheduled Castes and Scheduled Tribes in Employee Strength
Cadre |
Total Employees |
Composition |
|
|
SC |
% |
ST |
% |
OBC |
% |
Officers |
406 |
70 |
17.24 |
28 |
6.89 |
80 |
19.70 |
Clerical Staff |
43 |
8 |
18.60 |
5 |
11.63 |
9 |
20.93 |
Sub-Staff |
0 |
0 |
0.00 |
0 |
0.00 |
0 |
0.00 |
Total |
449 |
78 |
17.37 |
33 |
7.34 |
89 |
19.82 |
III. Welfare of SC/ST/OBC:
The Corporation framed rules as per the National Policy on Reservations for SC/ST &
OBC, which allows reservations, concessions/ relaxations to SC/ST & OBC, in
recruitment and promotions wherever applicable. Special in-house training classes are
conducted for employees who are in promotion zone, in order to enable them to acquire
knowledge and perform better in the pre-promotional written examination. The Corporation
also organizes On-line training for SC/ST candidates who apply for the Recruitment
Examination on All India Basis.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION
AND REDRESSAL) ACT, 2013
The Corporation has been employing women employees in various cadres in all offices
within India and abroad. The Corporation has in place a policy against Sexual Harassment,
in line with the requirement of The Sexual Harassment of Women At Work Place (Prevention,
Prohibition and Redressal) Act, 2013. All employees are covered under the policy. There
has been no complaint from any employee during the financial year 2022-23 and hence no
complaint is outstanding for redressal as at 31.03.2023.
IMPLEMENTATION OF OFFICIAL LANGUAGE POLICY OF THE CENTRAL GOVERNMENT
The Corporation improved its performance in the implementation of the Official Language
Policy of the Government of India and complied with all the guidelines issued by the
Ministry from time to time.
As mandated by the Official Language Policy of the Government, inspections of
Departments situated in Head office, Mumbai and online inspections of liaison offices at
Delhi were carried out by the officials of Official Language Department.
Four In-house workshops and one online workshop for Delhi Liaison office were
organized. Four meetings of Official Language Implementation Committee were conducted
during the year 2022-23. The Annual Hindi Review meeting was organized in the month of
February 2023.
Apart from the regular translation work, translation of Financial Standing Order (FSO),
and translation regarding updation of GIC portal were also carried out during the year.
The in-house quarterly journal KSHITIJ was published during the year. It was also made
available on the Corporation's website. During the month of September various competitions
were organized to mark "Hindi Day" celebrations in order to promote the usage of
Hindi language in day-to-day work. The "Hindi Day" Annual Programme was
celebrated in the month of October 2022.
Almost all Officers and Employees are having working knowledge of Official Language.
Hindi typing facility through UNICODE is available in computers to enable the Officers and
Employees to do their day-to-day work in Hindi.
Officials of GIC have attended all Town Official Language Implementation Committee
(TOLIC) meetings and GIC Re has participated in various programmes organized under the
aegis of the Town Official Language Implementation Committee (TOLIC).
This year Official Language Department of GIC was awarded 2 prizes by TOLIC; one for
Hindi In-house magazine "KSHITIJ" and the other for Best Implementation in
Official Language.
PROCUREMENT OF GOODS & SERVICES FROM MICRO AND SMALL ENTERPRISES (MSEs)
The Procurement of goods and services are through the GeM portal as per the Government
of India mandate and ensures compliance of all the Government of India guidelines.
The Government of India has notified a Public Procurement Policy for Micro and Small
Enterprises (MSEs) order 2012 and its amendments thereof. The objective of these order is
to achieve an overall procurement of minimum 25% from MSEs. GIC Re has procured 27% from
MSEs for the year 2022-23 for its IT and Office Services procurement.
VIGILANCE
The Vigilance Department of the Corporation is headed by Chief Vigilance Officer (CVO)
in the rank of Deputy General Manager, appointed by DFS, MOF, GOI. Vigilance
administration is an integral function of the Organization like any other function of
management, which includes detecting irregularities, analysing, and finding out reasons
for such irregularities and making effective systemic improvements to curb them besides
identifying the officials responsible for misconduct and taking appropriate punitive
actions.
Mainly focusing on preventive vigilance measures besides various systemic improvements
in all areas of the organization, in tune with CVC (Central Vigilance Commission)
guidelines. Vigilance Department is conducting surprise inspection, regular inspection,
scrutiny of audit reports viz Internal audit, Concurrent Audit, CAG, Special Audits etc.,
and CTE type of inspection (Procurement in Goods, Works and Services) regularly on monthly
/quarterly basis and those findings /lapses are studied on Vigilance angle. Based on the
analysis of reports, suggestions are recommended to Depts for improvement of systems and
procedures and for revisiting existing SOP to strengthen further against such lapses.
Also, the issues have been discussed in Structured meeting with CMD on quarterly basis.
Under Punitive side, existing cases are being followed up with Depts and with advice of
CVC wherever applicable, ensuring that punitive actions are taken in accordance with the
General Insurance (Conduct, Discipline and Appeal) Rules, 2014. Periodical discussions are
held with various Departments and Training is also imparted to all the levels of employees
in the areas of Preventive vigilance, Discipline, and Conduct rules of the Organization by
Vigilance Department. CVC and DFS directives have been implemented strictly in the
Organization. Vigilance Department believes that effective vigilance set up will certainly
ensure the functioning of the other segments of the Organization in an efficient way.
INTERNAL AUDIT DEPARTMENT
The main objective of the Internal Audit is to keep strict control over all the
activities of any organization with a view to facilitate management assurance of the
authenticity of the financial records, efficiency of operations of the firm and to
strengthen the overall governance mechanism.
The Corporation has its systems and controls in place covering all major areas of
operations such as, Underwriting, Investment, Finance and IT system.
To accomplish its objectives in a systematic and disciplined manner, Internal Audit
Department has utilized the services of professional audit firms. During the Financial
Year 2022-23, M/s Kirtane & Pandit, Chartered Accountants, were re-appointed as
Internal Auditors for Reinsurance Operations and Business Accounts and M/s S.K. Patodia
& Associates, Chartered Accountants, were appointed as Internal Auditors for
Investment Operations and other departments.
The Internal Audit Department also appoints Internal Auditors for foreign branches of
GIC Re in London, Dubai and Malaysia and International Financial Service Centre Insurance
Offices (IIO) at GIFT City.
Besides, the following special audits were also arranged by the Internal Audit
Department:
1. Secretarial Audit
2. Audit of Indian Nuclear Insurance Pool
3. Audit of Indian Market Terrorism Risk Insurance Pool
4. Investment Risk Management System and Process Audit
Internal Audit Department also liaisons with Comptroller & Auditor General of India
(CAG) and other departments for matters relating to CAG audit. The status of Draft Paras
(DPs) and Inspection Reports (IRs), issued by Comptroller & Auditor General of India
(CAG), is placed before the Board and the Audit Committee of the Board from time to time.
The Internal Audit Department functions independently under the supervision of the
Audit Committee of the Board. The Audit Reports of GIC Re, Head Office and Foreign
branches are placed before the Audit Committee of the Board for their consideration and
directions. Four (4) meetings of the Audit Committee of the Board were held during the
year 2022-23. Action Taken Reports were presented to the Audit Committee to report the
status of progress on the implementation of the directions of the Committee.
During the year, the guidelines and scope of audit for Appointment of Internal Auditors
of GIC Re, along with foreign branches for Reinsurance and Investment &
Non-Reinsurance functions were reviewed keeping in view the evolving role of auditors in a
scenario where Corporate Governance, regulatory compliance, management reporting systems,
transparency and prevention of fraud has gained increasing importance. Like every year
emphasis was laid on core business activities and audit of Reinsurance underwriting
operations, settlement of outstanding accounts & reconciliations of broker balances,
Treaty acceptances, Cash Call settlements and Settlement of Accounts were audited on
concurrent basis. Other departments like Investments, Human Resources, IT, Communication,
General Accounts, Office Services etc. were also covered during the year.
Besides the major expenditure incurred, both Revenue and Capital, having financial
implications, were also subjected to audit. Audit of Investment Operations was conducted
on concurrent basis. This covered the primary and secondary market transactions. In line
with RBI directions, Subsidiary Government Ledger (SGL) for Central and State Government
Securities were subjected to concurrent audit and confirmation of correctness of balances
and its reconciliation at the end of each month were sent to RBI. The same was also placed
before the Audit Committee at its meetings.
The Audit function in the Corporation has brought about improvement in data quality,
acceleration in claim processing, streamlining of process of accounts receivable
management in the Reinsurance Operations. By critically appraising the Management of the
Corporation of the various systems and processes, the Internal Audit Department
facilitated to strengthen the overall governance mechanism.
The Annual Budget of the Corporation/Mid-Year budget review exercise based on Budget
Estimates of individual Departments were placed before the Board and approved.
RTI ACT, 2005
The Corporation has in place the stipulated structure to implement the RTI Act 2005, in
the Organization. The Setup is headed by a General Manager designated as the Transparency
& Nodal Officer. A General Manager functions as the Appellate Authority, an Assistant
General Manager is the Central Public Information Officer, a Senior Manager discharges the
duties of Assistant Public Information Officer under the provisions of the Act. An
Assistant Manager has been nominated as Nodal Officer, MIS.
The Corporate website https://www.gicre.in/en/ also hosts information as relevant to
the Corporation, under the Act. It has separate Right to Information link developed and
continuously updated by the RTI Cell (GIC : Home Page (gicre.in)) containing information
and complying with the provisions under the RTI Act, 2005 and other Ministerial and CIC
circulars.
GIC Re in the FY 2022-23 complied with the guidelines issued by Ministry of Personnel
regarding Implementation of suomotu disclosure u/s 4 of the RTI Act, 2005 and its Audit
thereof.
During the period under review, the Corporation received One hundred and fifty-five
(155) Applications and Eight (8) First Appeals under the RTI Act, 2005. All the
Applications were duly replied, and appeals were disposed of well within the stipulated
time. One (1) Second Appeal was filed against the Corporation before Central Information
Commission and the same was disposed of by the CIC, during the period under review.
INFORMATION TECHNOLOGY MANAGEMENT GROUP (ITMG)
The year 2022-23 has been one of major transformations both in terms of technology and
cyber-security enhancements to protect that technology.
During the year, GIC Re Migrated from a traditional hybrid cloud setup to a fully
virtualized Government Community Cloud (under GOI's Meghraj Initiative) with a MEITY
Certified CSP (Cloud Service Provider). This Organization wide transformation was
successfully achieved without any downtime to business. A huge milestone achieved during
this project was the plethora of Security Components that GIC Re implemented to protect
its data, making it a pioneer in the Indian BFSI Sector.
The second major transformation was the database upgrade of SAP ECC to SAP S/4 HANA
database which was completed successfully without any business impact. GIC Re is now fully
Live and reaping the benefits of SAP's HANA Database for its core businesses. Phase 2 of
the S/4 Transformation journey has begun, and a knowledge partner will be onboarded in the
FY 23-24 to take this journey forward.
On the network front, GIC Re has migrated from a traditional MPLS setup to a completely
Software Defined Network (SD-WAN) streamlining traffic flow throughput, boosting
performance Organization wide and removing all network bottlenecks.
GIC Re has also successfully coordinated with CERT-In in implementing Phase 2 of the
National Cyber Coordination Centre (NCCC) Project. The Organization's traffic flow is now
completely monitored by CERT-In, and regular recommendations are implemented.
The Corporation has also successfully integrated Email Services and endpoint management
and is working towards Organization wide Workflow implementation to make paperless office
a reality. The Corporation has also started the process of identifying a partner for
implementing Enterprise Governance, Risk & Compliance (EGRC) platform.
TRAINING/HRD
Training policy of GIC Re has been outlined to aid it in its journey of building
in-house capability to achieve effective performance at workplace. GIC Re is committed to
ensuring that all its employees have access to learning and development opportunities
which enable them to acquire knowledge and skills that are necessary to carry out their
role within Corporation, and to develop talent pool in ways that fit with the
Corporation's global standing and nature of business from futuristic outlook.
At GIC Re, we ensure that employees skills, individual goals and the performance of
employees are aligned with the Organization's goals. The training programmes are
implemented for our employees that will raise awareness and competency of the employees
and enlist their support in improving GIC Re's performance.
In the year 2022-2023, training was imparted to all levels of employees. Training
programmes were conducted through various institutes. Both technical and behavioural
training programmes were conducted throughout the year. Summary of Training Programmes
organised by Training Department is given below.
Training for the period 2022-23
Organisation |
No. of programmes |
No. of employees |
National Insurance Academy |
32 |
135 |
Insurance Institute of India |
6 |
40 |
Indian Institute of Management |
2 |
7 |
Other Reputed Institutes |
6 |
148 |
In House |
45 |
160 |
1. A high-end training programme on "Data to Decision" was conducted through
IIM, Bangalore for the officials of Claims Vertical Department and on "Contract
Management and Arbitration" was conducted through IIM, Kolkata for officials of
Officers Service Department.
2. The Training department also conducted the pre-promotional training programme for
all eligible employees to equip them for the promotional examination. The topics like
Reinsurance, RI Claims, Accounts, Information Technology, HR etc. were covered. The
faculties for this training were in-house.
3. This year on the occasion of International Women's Day customized training programme
was organised for women employees, covering welfare of the women. The specialised
"Ayurveda for Women" training programme was conducted by an experienced
Ayurvedic doctor which was appreciated by women employees. An approximate of 60 women
could avail the benefit of the said programme. The programme was appreciated by the
officials.
4. An Online Programme on GST with Recent Amendments & Budget Updates 2023 was
organised to familiarise the employees working in Finance Department regarding the changes
in Budget and GST.
5. 44 Employees have enrolled themselves for the Online Diploma in Reinsurance by NIA
which is a 2-month programme scheduled on Saturdays.
6. The Art of Pricing General Insurance Products- a webinar series- 08 officials from
the Actuarial Team participated in the 13 sessions webinar which was spread over 3 months.
7. Training on Preventive Vigilance- for female officials in Scale IV and V was
organised. The faculty for this training was the Chief Vigilance Officer of the
Organisation. There were about 34 officials who gained benefit from this training program.
8. Officials dealing with Reservations in services were imparted training on Roster and
Reservation in Service.
9. An in-house training on Pricing Tools was organised for officials of Agriculture RI,
Misc., Health, Liability and Property RI Deptt. 26 officials attend the training.
10. Training Department arranged a 3-day offline training program at National Insurance
Academy, Pune on IND-AS/ IFRS Implementation- wherein 20 officials from Scale I to Scale
VI were benefitted. The program was very well received by the participants.
11. The In-house refresher training program was arranged for Business Accounts Section
(BAS) employees i.r.o SAP overview and reports, BWP, Checks & Controls to ensure
completeness in Trial Balance. Approx 33 BAS employees attended the said training.
12. "Deep Dive IFRS Training Program for Insurance Industry Professionals"
training was undertaken for 28 officials which was jointly organized by Institute of
Chartered Accountants and Institute of Actuaries of India.
Training Department has tried to ensure that each employee could avail at least one
training during the year 2022-23.
OVERSEAS EXPANSION
Overseas expansion of operations, through branch offices, subsidiaries and joint
ventures is an integral part of the business growth strategy so as to expand the reach of
the operations into multiple countries throughout the world. The Corporation targets
expansion into new markets by efficiently using the potential and creating additional
sustainable income opportunities, both in developed countries, where there is larger
demand and in developing countries where there is increasing demand.
Expansion plans are drawn based on study of market opportunities, supported by
understanding of the business, working environment and regulations in prospective markets.
The Corporation has also been striking strategic partnership with reinsurers abroad to
take advantage of the expertise and experience of both parties and leverage on economies
of scale.
INVESTMENT IN INSURANCE COMPANIES DOMESTIC OPERATIONS
AGRICULTURE INSURANCE COMPANY OF INDIA LTD. (AICIL)
The Corporation holds 35% equity of AICIL and NABARD holds 30% while the balance is
held equally to the extent of 8.75% by the four public sector non-life insurance
companies.
OVERSEAS OPERATIONS
The Corporation has 3 overseas offices viz. Branch Offices in London, Dubai and
Malaysia.
Apart from this, the Corporation has three wholly owned subsidiaries viz. GIC Re South
Africa Ltd., Johannesburg; GIC Re, India, Corporate Member Limited, London and GIC
Perestrakhovanie LLC, Moscow. The Corporation also has invested in the share capitals of
Kenindia Assurance Company Ltd., Kenya, India International Insurance Pte Ltd., Singapore,
Asian Reinsurance Corporation, Bangkok, East Africa Reinsurance Company Ltd., Kenya, and
GIC Bhutan Re Ltd., Bhutan.
LONDON BRANCH (UK)
During the current financial year 2022-23, the Gross Written Premium by the Branch is
GBP 124.74 million compared to GBP 117.96 million last year and earned a profit of GBP
19.71 million as against a profit of GBP 1.47 million last year.
DUBAI BRANCH (UAE)
During the current financial year 2022-23, the Gross Premium of the Branch is AED 91.95
million compared to AED 198.32 million last year and the Branch earned a profit of AED
103.8 million compared to AED 0.26 million last year.
MALAYSIA BRANCH
During the current financial year 2022-23, the Gross Premium written by the Branch was
RM 585.97 million compared to RM 644.55 million and incurred a loss (before tax) of RM
13.5 million as compared to a loss (before tax) of RM 127.43 million.
KENINDIA ASSURANCE CO. LTD., KENYA
The Corporation holds 9.19% shares in Kenindia which has a paid-up share capital of
Kshs 1000 million. The total shares held by the Corporation is 9,18,752 shares of Kshs 100
each as on 31st December 2022. The Company reported a net profit after tax of Kshs 620.33
million as against net profit after tax of Kshs 836.43 million last year. The Board of the
Company recommended a dividend of Kshs 5.00 per share for the year ended 31st December
2022.
INDIA INTERNATIONAL INSURANCE PTE. LTD., SINGAPORE
The Corporation holds 20% shares in India International Insurance Pte. Ltd., which has
a share capital of S$ 50 million. The total shareholding of the Corporation in the Company
is 10 mn shares each of S$ 1.
The Company has made a loss of S$ 8.61 million as against a profit of S$ 21.23 million
last year.
The Directors have recommended a first and final dividend of 10% on the paid-up capital
of S$50.00 million for the year 2022.
ASIAN REINSURANCE CORPORATION, BANGKOK
The Corporation is holding 6.16% of the share capital as Associate Member of Asian Re
in addition to holding 0.97% of the share capital as its Regular Member on behalf of the
Government of India. Asian Re has made a profit of USD 1.83 million in 2022 as against a
profit of USD 1.57 million in 2021. The Company has not declared any dividend for the year
ended 31st December 2022.
EAST AFRICA REINSURANCE COMPANY LTD., KENYA
The Corporation has 14.7521% stake in the share capital of East Africa Reinsurance
Company Ltd., an existing profit-making reinsurance company in Kenya. The total
shareholding of the Corporation is 2,21,281 shares of Kshs. 1000, as on 31st December
2022.
The Company has made a profit of Kshs. 783.13 million as against a profit of Kshs.
137.39 million last year.
Board has recommended a total dividend of Kshs. 200 million (Kshs 133.33 per share)
equivalent to 25.54% of PAT for the year 2022.
GIC BHUTAN RE LTD.
The reinsurance company of Bhutan is a Joint Venture between the Corporation and local
Bhutanese promoters. The venture began its operations in the name 'GIC Bhutan Re Ltd.' in
December 2013.
The Corporation has a 26% stake in the Joint Venture and held 28,600,000 shares of
value Nu 10 each as of 31st December 2022. The rest of the shareholding are held by Local
Bhutanese promoters (29%) and 45% shares are held by the public.
The Company has made a profit of Nu 153.11 million (PAT) in 2022 as against a profit of
Nu 128.67 million (PAT) in 2021.
The Company has declared 6.95% dividend for the year ended 31st December 2022, as per
RMA regulations.
GIC RE SOUTH AFRICA LTD.
GIC Re South Africa Ltd. is the Corporation's first 100% owned subsidiary (Wholly owned
subsidiary) which started its commercial operations from 1st January 2015. The company
when acquired was in the run-off for both Life as well as Non-life business.
The Corporation holds 571,030,862 no par value ordinary shares with a value of ZAR
1,142,061,724 constituting 100% of GIC Re South Africa Ltd.'s equity as of 31st March
2023.
GIC RE, INDIA, CORPORATE MEMBER LIMITED
With the objective of becoming a reputed global reinsurer, the Corporation expanded
into Lloyd's of London by offering reinsurance capacity to Lloyd's syndicates through
quota share capital gearing treaties since 2011. As a capacity provider, the Corporation
was required to have its own Corporate Member at Lloyd's, the Corporation acquired I-CAT
CCM TEN Ltd., an existing corporate Member company, in November 2013 and renamed it as GIC
Re, India, Corporate Member Ltd., which is registered as a private limited company in the
UK. The Company commenced reinsurance operations in 2014.
The business underwritten by the Company is fully reinsured with the Corporation.
The company has not declared payment of any dividend for the year.
GIC PERESTRAKHOVANIE LLC
"GIC Perestrakhovanie LLC" (GIC Re Russia) commenced its operations during
August 2020. During the year 2022, due to the geopolitical crisis involving Russia and
Ukraine, GIC Re Russia restricted its business activity to the Russian Federation only. It
has been witnessing a drastic drop in the topline owing to the changed dynamics in the
local reinsurance market and therefore, it continues to observe the unfolding situation
closely so as to realign its strategies in the near future.
The subsidiary could close its financial year ended on 31st December 2022 with a
written premium of 82.45 million Rubles. The net incurred claim to earned premium ratio
was 111.34%.
LISTING OF EQUITY SHARES
The shares of the Corporation are listed on National Stock Exchange of India Limited
(NSE) and BSE Limited (BSE).
PUBLIC DEPOSITS
The Corporation has not accepted any deposits under Section 73 of the Companies Act,
2013.
DIRECTORS AND OTHER KEY MANAGERIAL PERSONNEL
The Board of Directors of the Corporation as on 31st March 2023 consisted of eight (8)
Directors, comprising of four (4) Independent Directors, one (1) Government Nominee
Director and three (3) Executive Directors including Chairman and Managing Director.
None of the Directors are related to any other Director or employee of the Corporation.
The details pertaining to composition and change in Board, committees and details of
meetings is provided under Corporate Governance Report.
DECLARATION BY INDEPENDENT DIRECTORS
All the Independent directors have given a declaration that they meet the criteria of
independence as laid down under Section 149(6) & (7) of the Companies Act, 2013, the
Companies (Appointment and Qualification of Directors) Rules, 2014 as amended from time to
time and the SEBI (LODR) Regulations.
The Corporation, being a Government Company, is under the administrative control of
Ministry of Finance (MoF), the power to appoint Directors (including Independent
Directors) vests with the Government of India. The appointment of Directors is done by MoF
after due processes involving screening, review and compliances. In the opinion of the
Board, the Independent Directors possess integrity and the requisite expertise and
experience.
POLICY FOR SELECTION AND APPOINTMENT OF DIRECTORS AND THEIR REMUNERATION
The Corporation being a Government Company, is exempted to furnish information under
Section 134(3)(e) of the Companies Act, 2013 vide MCA Notification dated 5th June 2015.
POLICY FOR REMUNERATION OF KEY MANAGERIAL PERSON AND OTHER EMPLOYEES
The Corporation, being a Government Company, the remuneration payable to Key Managerial
Persons and other employees are as per the Government of India norms.
CODE OF CONDUCT UNDER SECURITIES AND EXCHANGE BOARD OF INDIA (PROHIBITION OF INSIDER
TRADING) REGULATIONS, 2015
The Corporation has in place a Code of Conduct to regulate, monitor and report trades
in securities by Directors, Employees & Connected Persons which is in conformity with
the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations,
2015. The Code is applicable to the Employees of the Corporation, Designated Persons, and
their Immediate Relatives and Connected Persons, to the extent applicable. The objective
of the Code is to prohibit insider trading in any manner by the Designated Persons and to
maintain confidentiality of unpublished price sensitive information and access to
information on a 'need to know' basis.
VIGIL MECHANISM/ WHISTLE BLOWER POLICY
The Corporation, being a Government Company is subjected to the CVC Guidelines and the
Corporation has a separate Vigilance Department administering the Vigilance matters.
The Corporation has a Vigil Mechanism/Whistle Blower Policy approved by the Board and
the same is placed on the website of the Corporation.
CORPORATE GOVERNANCE
The Corporation continues to adopt the best practices of Corporate Governance to ensure
transparency, integrity and accountability in its functioning. The Corporate Governance
Report has been incorporated as a separate section, forming part of this Annual Report.
BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORTING
Business Responsibility and Sustainability Report as stipulated under Regulation 34 of
the SEBI (LODR) Regulations forms part of the Annual Report and has been hosted on the
website of the Corporation and can be viewed at www.gicre.in.
CEO/CFO CERTIFICATION
In terms of the SEBI (LODR) Regulations, the certification by the Managing Director
& CEO and Chief Financial Officer of the Corporation on the financial statements and
internal controls relating to financial reporting has been obtained.
DETAILS OF UNCLAIMED SUSPENSE ACCOUNT
Details of Unclaimed Suspense Account as provided by our Registrar and Transfer Agent
i.e. KFin Technologies Limited pursuant to Regulation 39 read with Part F of Schedule V of
the SEBI (LODR) Regulations is as under:
Sr. No. |
Description |
No. of Shareholders |
No. of Shares |
1 |
Aggregate number of shareholders and the outstanding shares lying
unclaimed as on 01.04.2022 |
01 |
32 |
2 |
Number of shareholders who approached Listed entity for transfer of
shares from suspense account during the year |
0 |
0 |
3 |
Number of shareholders to whom shares were transferred from suspense
account during the year |
0 |
0 |
4 |
Aggregate Number of shareholders and the outstanding shares lying
unclaimed as on 31.03.2023 |
01 |
32 |
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134 of the Companies Act, 2013, the Directors
confirm that:
1. In the preparation of annual accounts, the applicable accounting standards have been
followed along with proper explanations relating to material departures;
2. The Directors have selected such accounting policies and applied them consistently
and made judgements and estimates that are reasonable and prudent so as to give a true and
fair view of the state of affairs of the Corporation at the end of the financial year and
the profit and loss of the Corporation for that period;
3. The Directors have taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of Companies Act, 2013 for
safeguarding the assets of the Corporation and for preventing and detecting fraud and
other irregularities;
4. The Directors have prepared the annual accounts on a going concern basis;
5. The Directors have laid down internal financial control to be followed by the
Corporation and that such Internal Financial Controls are adequate and are operating
effectively; and
6. The Directors have devised proper systems to ensure compliance with applicable laws
and that such systems were adequate and operating effectively.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE CORPORATION
There has been no material change and commitment affecting the financial position of
the Corporation which occurred between the end of the financial year of the Corporation to
which the financial statements relate and the date of this report.
BOARD MEETINGS
The Corporation held eight (8) Board meetings during financial year 2022-23 as detailed
below:
19th May 2022 27th May 2022 10th August 2022 19th October 2022 9th November 2022 21st
December 2022 30th January 2023 9th February 2023
SECRETARIAL STANDARDS
During FY 2022-23, the Corporation was in compliance with the applicable Secretarial
Standards issued by the Institute of Company Secretaries of India with respect to Board
and General Meetings.
SUBMISSION OF ACCOUNTS BEFORE PARLIAMENT
As confirmed by the Ministry of Finance, Insurance Division, the Annual Report of the
Corporation for the year 2021-22 along with Directors Report were placed before both the
Houses of Parliament under Section 394 of the Companies Act, 2013 as per details given
below:
LOK SABHA 12th December 2022 RAJYA SABHA 13th December 2022
ACKNOWLEDGEMENT
The Directors wish to place on record the co-operation received from Shri Amit Agrawal,
Government Nominee Director and Shri Atanu Kumar Das, Independent Director, during their
tenure as Directors on the Board of the Corporation.
The Corporation is grateful to the Insurance Regulatory and Development Authority of
India, Government of India, Reserve Bank of India and Securities and Exchange Board of
India for their continued cooperation, support and guidance. The Corporation wishes to
thank its investors, rating agencies, depositories, Registrar & Share Transfer Agent
& Stock Exchanges for their support.
The Corporation would like to express its gratitude for the continued support and
guidance received from Principal Director of Commercial Audit and Ex-Officio Member, Audit
Board - I, Mumbai.
The Directors express their appreciation to all employees for their outstanding
contributions, support and commitments towards the growth and success of the Organisation.
Finally, the Directors wish to express their gratitude to the Members for their trust and
support.
|
For and on behalf of the Board of Directors |
|
Sd/- |
Date : 25th May 2023 |
(Devesh Srivastava) |
Place : Mumbai |
Chairman and Managing Director |
|