The state-sponsored insurance firm United India Insurance Company or UIC is planning for its IPO by September 2018. Before it reaches the deadline of going IPO, the insurer is exploring different ways to improve the solvency ratio as well as improve the balance sheet records.
UIC expects to improve their solvency ratio to 1.8 by March, which is higher than the regulated ratio of 1.5. To improve the margins, the insurer has opted for a Rs.900 crore subordinate debt.
Even though the health insurance and motor insurance have been the major contributors towards losses, UIC has managed a healthy 10% growth when it comes to premiums. UIC has taken up several underwriting correction measures and is hopeful of breaking even or even be profitable.
As of now, the GST rate for insurance sector is at 18%, which several insurers feel is a tad high, UIC is one of them. GST rates of 10-12% for the insurance sector would ensure the consumers benefit from lower premiums. UIC is also pushing the government to increase the Rs. 25000 cap under Section 80D as the premium amounts have gone up substantially over the years.