Annual Rep. 2008-09.pmd - The New India Assurance Co. Ltd.

efo v³et Fefv[³ee SM³eesjvme kebÀ. efue.The New India Assurance Co. Ltd.Estbd. 1919Directors’ ReportS2008-09 2007-08COMPLIANCE WITH SECTION 40 CPercentage of expenses prescribed under the act 19.60 19.59Company’s actual percentage of expenses 23.82 16.77Percentage of expenses including commission prescribed under the Act 27.47 27.34Company’s actual percentage of expenses including commission. 31.99 24.86Provision for salary arrears and provision for company’s liability to pension and gratuity funds,and liability towards leave encashment have pushed the expenses of management beyond theprescribed limits.III. FOREIGN OPERATIONSThe Gross Premium is Rs. 1376.90 crores in 2008-09 as against Rs. 1143.63 crores in 2007-08showing an accretion of 20.4%. The Net Premium is Rs. 1164.28 crores in 2008-09 as againstRs. 932.07 crores in 2007-08 showing an increase of 24.9%. Our operations in Saudi Arabia showpremium income upto August 2008 only as we had stopped functioning as an Agency and are operatingas an Associate Company in Saudi Arabia.Foreign operations show underwriting profit of Rs. 78.08 crores in 2008-09 as against underwriting loss ofRs. 70.07 crores in 2007-08. The underwriting profit is after a provision of Reserve Strain of Rs. 121.17crores in 2008-09 in respect of unexpired risks. No major claims were reported during the year.The foreign exchange earning during the year 2008-09 amounted to Rs. 8.62 crores towards dividendand repatriation of management fees from our Associate and Subsidiary companies.Overseas operational result for the year ended 31 st March 2009 is as under:(Rupees in Crores)Sr. No. PARTICULARS 2008-09 2007-08Rs. % Rs. %1 Gross Premium (Gross Direct plus Accepted) 1376.90 20.4 1143.63 -3.62 Net Premium 1164.28 24.9 932.07 -5.03 Incurred Claims 545.83 46.9 693.55 74.44 Commission 311.82 26.8 236.16 25.35 Expenses of Management 104.84 9.0 88.92 9.56 Exchange Gain/ Loss Other Income / Outgo -2.54 -0.2 -2.04 -0.28 Underwriting Profit / Loss before Reserve Strain 199.25 17.1 -88.60 -9.59 Reserve Strain / Release 121.17 10.4 -18.53 -2.010 Underwriting Profit / Loss after Reserve Strain 78.08 6.7 -70.07 -7.511 Investment Income 116.08 10.0 113.70 12.212 Net Profit / Loss 194.16 16.7 43.63 4.7Note : (i) Percentage shown in Sr. no. 1 and 2 indicates the growth over previous year and thepercentage shown in Sr. no. 3 to 12 is percentage on “Net premium”.(ii)Country-wise details appended as per Annexure I to the Directors’ Report.14