The Insurance Regulatory and Development Authority of India (IRDAI) has revoked the license given to ITI Reinsurance due to failure to commence reinsurance business.
In December 2016, ITI Re established its operations but failed to begin business operations in the two year period until December 2018.
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ITI Re was granted a Certificate of Registration (CoR) by IRDAI to start transacting business; however, the company failed to secure any business due to stiff competition from state-owned General Insurance Corporation of India (GIC Re) as well as other foreign reinsurers.
Later, the IRDAI gave a two-year extension to ITI Re, but the company failed to seal any deal again.
In February 2019, ITI Re moved to surrender its licence after confirming that the company did not plan to carry out any business.
IRDAI had asked ITI Re to surrender it CoR, subject to certain conditions.
In December last year, IRDIA also rejected a proposal from Go Digit, an insurer owned by billionaire Prem Watsa, to buy ITI Re from its current owners, The Investment Trust of India.
A number of overseas reinsurance companies operate in India through their India office. All of these firms are subject to the first preference rule. They can get access to business only if the GIC Re does not take them on their books.
