Guaranteed capital of Russian National Reinsurance Company JSC (RNRC) is to total RUB 750 billion, Elena Kuritsina, Director of the Corporate Relations Department of the Bank of Russia, said at the joint meeting of the State Duma Committee for Industry and Trade and the Expert Board for Development of Shipbuilding Industry and Seaborne Trade held on Tuesday. The meeting discussed “Financial stability of defence complex companies in view of the industry specifics”.
“The decision has been made. The figure will be not RUB 300 billion but much closer to RUB 1 trillion. For the moment being, the guaranteed capital of RNRC is RUB 750 billion. The parental guarantee of the Bank of Russia will now cover not only sanction risks as it has been from 2014 up to the recent time but it will also cover all insurance risks for which international reinsurance markets are not available due to external factors. That makes it much easier for insurance companies to find reinsurance facilities since RUB 750 billion can actually offer a wider use,” she said. According to the Central Bank, guaranteed capital of RNRC is sufficient for the Russian market.
According to Dmitry Malyshev, Deputy Chairman of SOGAZ BoD, insurance capacity of RNRC earlier increased to RUB 300 billion already guaranteed coverage of 95% of Russian risks.
Besides, a draft law expanding the mandatory portion of reinsurance in RNRC 5-fold, from 10% to 50%, was approved earlier.
On March 3, the Bank of Russia announced its decision to increase to increase the authorised capital of its subsidiary RNRC JSC from 71 billion to 300 billion rubles.
“One of RNRC top priorities is to provide insurance coverage to companies facing the international sanctions. The increase in RNRC authorised capital will give Russian insurers wider opportunities to reinsure risks inside Russia, build additional reinsurance capacities, and manage new sanctions risks”, said the regulator’s statement.
On March 11, the State Duma prohibited insurance agents of the Russian Federation from dealing with insurance companies from unfriendly countries. As of the end of 2021, the international market accounted for 75% of risks subject to reinsurance.
RNRC has been in the market from 2006. Maritime shipping is among the key focuses of the company.