Insurance - Contents Insurance - Contents

Growth Of Insurance In India in Growth Of Insurance In India in recent pastrecent past

Acts governing InsuranceActs governing Insurance WTO and Insurance WTO and Insurance The Road AheadThe Road Ahead

• Growth Of Insurance In Growth Of Insurance In India in recent past India in recent past

INSURANCEINSURANCE

India has come a long way in the India has come a long way in the last six yearslast six years

Factors influencing Factors influencing growthgrowth

Exploring new marketsExploring new marketsInnovative product lineInnovative product lineImproved customer serviceImproved customer serviceImproved distribution channelImproved distribution channelChange in legislationChange in legislation

• Growth Of Insurance In India Growth Of Insurance In India in recent past in recent past ------------------------------------------------------------------------------

• Acts governing InsuranceActs governing Insurance

No regulation till 1866No regulation till 1866 Indian Companies Act (1866).Indian Companies Act (1866). the Indian Life Assurance the Indian Life Assurance

Companies ActCompanies Act (1912) (1912) the Provident Insurance the Provident Insurance

Societies ActSocieties Act (1912) (1912) Indian Insurance Companies Indian Insurance Companies

ActAct(1928)(1928)

first comprehensivefirst comprehensive legislation legislation Covered both life & non lifeCovered both life & non life RegulatedRegulated

– Investment patternInvestment pattern– Commission of agentsCommission of agents– Directors appointedDirectors appointed– supervision of insurance supervision of insurance

companiescompanies etc. etc.

Setting up of Tariff committee in Setting up of Tariff committee in 19501950

Life insurance was nationalized in Life insurance was nationalized in 1956 – formation of LIC1956 – formation of LIC

general insurance in 1972 – GICgeneral insurance in 1972 – GIC Setting up of Malhotra Committee Setting up of Malhotra Committee

in 1993in 1993 Setting up of (interim) Insurance Setting up of (interim) Insurance

Regulatory Authority (IRA) in Regulatory Authority (IRA) in 1996.1996.

previous Acts previous Acts proved to be proved to be obstacles in growthobstacles in growth

Rising costRising cost Subsidiaries of GIC acted as Subsidiaries of GIC acted as

cartelcartel the goal of “efficient customer the goal of “efficient customer

service” remained elusiveservice” remained elusive

Creation of IRDACreation of IRDA private sectorprivate sector should be should be

allowed to enter insuranceallowed to enter insurance foreign playersforeign players allowed allowed

Regulated appointment of Regulated appointment of actuariesactuaries

requirements for an agentrequirements for an agent solvency margin requirementssolvency margin requirements Registration of Indian Registration of Indian

Insurance CompaniesInsurance Companies Obligations of Insurers to Rural Obligations of Insurers to Rural

Social SectorsSocial Sectors

Capital of LIC raisedCapital of LIC raised Capital of GIC to be increasedCapital of GIC to be increased Minimum paid up capital Minimum paid up capital

requirementsrequirements Promoters holdingPromoters holding Security deposit Security deposit Failure to fulfill social Failure to fulfill social

obligations would attract a obligations would attract a finefine

• Growth Of Insurance In India Growth Of Insurance In India in recent past in recent past ------------------------------------------------------------------------------

• Acts governing InsuranceActs governing Insurance ------------------------------------------------------------------------------• WTO and InsuranceWTO and Insurance

FDI limitFDI limitDomestic regulationDomestic regulationAuxiliary servicesAuxiliary servicesChoice of commercial Choice of commercial

presencepresenceRequest to developed Request to developed

countriescountries

• Growth Of Insurance In India Growth Of Insurance In India in recent past in recent past ------------------------------------------------------------------------------

• Acts governing InsuranceActs governing Insurance ------------------------------------------------------------------------------• WTO and InsuranceWTO and Insurance

------------------------------------------------------------------------------• The Road AheadThe Road Ahead