Mumbai: ONGC's hard bargain with state-run United India Insurance and GIC Re has further brought down its annual renewal premium by almost 25 percent to USD 16 million for both insurance as well as reinsurance covers for its offshore assets valued at USD 34 billion.
One of the striking features of the ONGC's 2016-17 insurance renewal has been competitive bidding where the country's only national reinsurer GIC Re has managed to outbid its international peers.
In 2015-16, two European reinsurers -- Endurance and Aspen -- had outbid GIC Re to be the lead reinsurer for the deal.
"ONGC has renewed its insurance account for its offshore assets worth USD 34 billion for a premium of around USD 16 million, more than 25 per cent lower than what it had paid for last year," industry sources told PTI today.
The insurance cover, due for renewal on May 11, has been renewed in the London markets, they said.
Global general insurance prices have been heading south as claims have been lower unlike the previous year wherein claims were higher due to many catastrophes and aviation accidents.
This is the second year that the state-run oil and gas major, which has the largest insurable assets in the country, has managed to get a discount.
Last fiscal, it had renewed its policies at almost 35 per cent discount at USD 20 million.
Given the limited capacity for risks in the country, over 80 per cent of ONGC's insurance cover is usually reinsured by global reinsurers.