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general insurance market in india

general insurance market in india

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Published by CHAITRA NAIK

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Published by: CHAITRA NAIK on Jan 12, 2010
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03/08/2015

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The Indian insurance sector is rapidly moving towards international

standards of free (risk-based) market pricing and new/innovative product

offerings. Big changes have occurred over the last few years, during

which the sector was opened to private participation, along with foreign

direct investment (FDI) capped at 26%.

India is the 5th largest market in Asia by premium, following Japan, Korea,

China and Taiwan. The country is geographically large and has the

world’s 2nd largest population -- 1.13 billion in 2007 – but it also has one

of the lowest penetration rates for property and casualty insurance in Asia

in terms of premium as a percentage of GDP.

India’s general insurance market witnessed a variety of changes as

deregulation continued at a hectic pace.

The sector achieved double-digit growth and this trend is expected to

persist over the medium term on the back of greater penetration, due

partly in turn to the intense marketing efforts of private insurers. The

A STUDY ON INDIAN GENERAL INSURANCE INDUSTRY- AUTO INSURANCE

PAGE 15

KRUPANIDHI INSTITUTE OF MANAGEMENT EDUCATION
2009

removal of pricing controls on fire and engineering lines in 2007, insurers

have discounted their rates by 50% in order to retain or win market share.

Private players continue to capture market share at the expense of public

enterprises on a mix of aggressive distribution and service. The number of

private insurers is growing as various foreign companies have announced

intentions to establish joint ventures.

Rate reductions in the recently de-tariff corporate portfolio (fire &

engineering) has impacted the premium growth, but this is also leading to

the greater sales of existing and new products. With the regulator lifting

the ceiling on foreign ownership to 49%, foreign players participation has

increase both volumes and types of products.

With the increasing number of insurers in the private sector. The industry

forecasts for a continuous growth and rise domestic demand.

General Insurance Penetration 0.60% of GDP and the Gross Premium has

increased to(2007-08) is Rs.28130 Crores compared to the Gross Premium

(2000-01) of Rs.9620 Crores

With CAGR: 16.6%

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