The Internet Industry As a result of globalizationderegulation and terrorist attacks, the insurance industry has gone through a tremendous transformation over the past decade.
LIC, the market leader in this segment, is a state owned organization and has had a monopoly in the life insurance business for over four decades until LIC still remains the market leader, by a wide margin, with an estimated market share of However, at the margin, it has been loosing Thesis insurance industry share to private sector players.
New india assurance secured 1st position and is enjoying market share of Motor and fire policies are the Thesis insurance industry of non-life business in India.
They also contributed the most to overall premium growth in the last five years. Compared to other markets, personal lines insurance is also relatively well-developed in India. This is mainly manifested in personal motor and private residential fire policies.
In fact, among emerging markets with a similar level of per capita income, India has the highest share of personal lines business. After the opening of the sector to private players, more new products were introduced.
To take an example, one joint-venture non-life insurer introduced 29 different products during one year, according to the IRDA. They included products liability, corporate cover, professional indemnity policies, burglary cover, individual and group health policies, weather insurance, credit insurance, travel insurance and so on.
Some of these products were completely new e. They could also be classified by whether they were regulated by tariffs: In addition, most specialized insurance e. The following table shows the age-wise distribution of population in future years: Further incrementally there is a shift happening from large joint families to nuclear families, which increases the need insurance amongst these households as the dependency ratio increases significantly.
Aversion to debt by most of the new generation households has also led to higher monthly debt servicing requirement. Increasing debt servicing has also resulted in higher need for insurance as most of the families have a single bread earner. Tapping those markets will boost the insurance industry.
Privatization of the insurance industry in improved penetration from 1. Life insurance industry has contributed to more than 3. The non-life public sector insurers have been rather slow to respond to the evolving competition.
Both the Authority and the industry have been playing an active role in increasing consumer awareness. Large sections of rural India are still untouched because of long distances, poor distribution and high return costs. To understand the prospects for insurance companies in rural India, it is very important to understand the requirements of India's villagers, their daily lives, their peculiar needs and their occupational structures.
There are farmers, craftsmen, milkmen, weavers, casual laborers, construction workers and shopkeepers and so on. In the context of international comparison, insurance penetration in India is low but commensurate with its level of per capita income. With such high demand, the insurance industry has created scope for expansion in the employment industry too.
Life insurance industry provides increased employment opportunities.
Brokers, corporate agents, training establishments provide extra employment opportunities. Many of these openings are in rural sectors. In contrast, most Asian life insurance sectors are already heavily populated by foreign insurers.
Foreign non-life insurers have achieved penetration in India similar to those in other Asian markets. It can be expected that foreign insurance companies will continue to expand their market share in India in the coming years, notwithstanding the fact that public sector insurers are also proactively strengthening their business strategies to fight rising competition.
With the entry of private foreign firms, consumer knowledge is increasing through international approach of advertising and marketing.
Also most of the private sector players have set up a vast distribution network, including overagents LIC has over a million agentsmost of whom are more qualified than LIC agents.
A qualified work force and an extensive distribution network has further helped the private insurance companies to increase awareness about life insurance. The mentality of Indian policy holders is only from an investment perspective, and with foreign influence this is changing to awareness of insurance as security and protection.
Pure insurance products like term and health are not yet popular, largely owing to the mindset of the average Indian consumer. This is predicted to change with more western exposure and awareness of other insurance products. Pension system and health insurance are increasing with urbanization.
There are around 30 health insurance products in the market right now. Over the past several years, Government of India has been offering various tax benefits to encourage individuals to buy life insurance.Risk Management and Performance in Insurance Companies Master Thesis Date Enschede, January 27th, Author had a dramatic effect on the insurance industry.
The impact of the crisis caused various This thesis has been written as a final assignment of my MSc Business Administration.
India and UK Financial Insurance Industry Analysis. Print Reference this. Disclaimer: The reason for choosing Indian and UK insurance industry for the research is because of improved economical status of the country and increase in the value of insurance in the country during last several years.
The UK Economy is the largest in Europe and. The thesis mainly consists of two parts: 1) theoretical study, where strategic management theory is explained, and 2) case study, where China Life Insurance Company Ltd.
in Shifang is adopted as an example to show the process of adopting.
1 Introduction to the Insurance Industry Rodney Lester The nature and history of insurance Insurance in its pure form is a social good and in a number of cases can. Introduction to the Insurance Industry 3 15 percent annually) and the average claim size is small, thus gener-ating statistically credible databases.
However the cost of capital can dominate where large elements of uncertainty exist and systemic events. The insurance industry suffers most from negative image as a result of lower customer satisfaction perception (NIC, ).
The general public has different perception on life assurance policy. Most of the time, clients complains of inability of insurance companies to pay prompt claims, sometimes.