Overview of the Insurance Sector in India
Introduction to Insurance Sector in India
The insurance sector in India is no incongruous. It has been in existence ever since the birth of Oriental Life Insurance Company in India. Over the years, India has seen a lot of changes in the insurance sector for good. Today insurance sector in India consists of more than 50 insurance companies comprising of life insurance sector and general insurance sector. Earlier it was only LIC known for life insurance, but now there are 20+ life insurance companies. Similarly, National Insurance, United India Insurance, New India Insurance were the caretakers of general insurance in India, but with IRDAI rules, there are 30+ non- life insurance companies.
Importance of Insurance Sector in India
- It Provides Safety and Security: On the event of death or loss of property, the sum assured received from the insurers is a safety and security for the survivors.
- Encourages Savings and Economic Growth: The habit of saving inculcates and since the money is being mobilized by the insurers, there’s an economic growth.
- Medical and Health Benefits: You no more think of getting worried on being hospitalized, as the bills and health benefits are covered by the insurers.
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Kinds of Insurance Sectors in India
Insurance sector in India is broadly classified as
- Life insurance
Nature: The term states that it is meant to cover the life of policyholder or his family members. During this course, the insurers gain investment prospects. It’s a win-win situation for both the parties.
Performance: The public sector companies’ performance has increased in heaps and tons as compared to the private sector undertaking life insurance companies. Except for the number of offices in India the company holds, the public sector has outdone private sector with regards to the premium underwritten, new policies issued, benefits paid, individual death claims, public sector companies have given their best services.
Appellation: LIC, New India, United Insurance and oriental, National insurance, Aegon, Aviva, Bajaj Allianz, Bharti AXA, Birla Sun, Canara HSBC Oriental Bank of Commerce, DHFL Pramerica, Edelweiss Tokio, Exide, Future Generali, HDFC Standard, ICICI Prudential, IDBI Federal, India First, Kotak Mahindra, Max, PNB MetLife, Reliance, Sahara India, SBI, Shriram, Star Union Dai-Ichi, Tata AIA .
- Non-Life Insurance
Nature: This category takes health, motor vehicles, home, travel, industrial machinery and supplies, crop insurance, electronic insurance for gadgets etc. into account.
Performance: The performance of this sector is pretty much like life insurance companies. Except for the number of offices, public sector insurance companies are way ahead of the private sector; benefits paid premiums underwritten, new policies issued, net incurred claims, public sector companies do it well.
Health insurance category-Apollo Munich, Star Health, Max Bupa, Religare, Cigna TTK, Aditya Birla etc.
General insurance category–Bajaj Allianz, Bharti AXA, Cholamandalam, Future, HDFC ERGO, ICICI Lombard, IFFCO-Tokio, Kotak, L&T, Liberty Videocon, Magma HDI, Raheja QBE, Reliance, Royal Sundaram, SBI, Shriram, TATA AIG, Universal Sompo etc.
Role of IRDAI
Constituted in the year 1999, the Insurance Regulatory and Development Authority of India (IRDAI), issues renews, modifies, withdrawal suspends or even cancels the registrations, if need be. There has been a wider opening for private sector undertaking because of IRDAI and future of insurance sector in India is going to be vast.
The future of insurance sector is endeavoring and there have been plans for the lower section of the society too. Plans such as Pradhan Mantri Suraksha Bima Yojana (PMSBY), Rashtriya Swasthya Bima Yojana (RSBY) and Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) are gearing up.
In fact, there are two functional insurers catering services for crops insurance is Agriculture Insurance Company Ltd and for credit, insurance is Export Credit Guarantee of India. With Indians being more aware of insurance’s importance, the insurance sector in India ought to grow.