INSURANCE SECTOR IN

INDIA
GROUP 4
SYBIM
ROLL.NO
NAMES 8 12. 16. 20.
4 KULDEEP VIDHI.D ACHAL MONISH
BHAVANA

24. 28. 32. 36. 40.

VIDHI.J ASHWIN DARSHAN SANIKA VANSH

44. 48. 52. 56. 60.

RAHUL VATSAL SUSHIPRA KANCHI YUSRA
HISTORY OF
INSURANCE
Some of the important milestones in the life insurance business in India are:
• 1818: Oriental Life Insurance Company, the first life insurance company on Indian
soil started functioning.
• 1870: Bombay Mutual Life Assurance Society, the first Indian life insurance
company started its business. 
• 1912: The Indian Life Assurance Companies Act enacted as the first statute to
regulate the life insurance business.
• 1938: Earlier legislation consolidated and amended to by the Insurance Act with the
objective of protecting the interests of the insuring public.
• 1956: 245 Indian and foreign insurers and provident societies are taken over by the
central government and nationalized. LIC formed by an Act of Parliament, viz. LIC
Act, 1956, with a capital contribution of Rs 5 core from the Government of India.
• 1972, 107 general insurers were nationalized through the passing of General
Insurance Business (Nationalization) Act, 1972.
• The existing 107 insurers were amalgamated and grouped into Five companies,
viz., National Insurance Company (NIC), New India Assurance Company (NIAC),
Oriental Insurance Company (OIC), United India Insurance Company (UIIC), and
General Insurance Corporation (GIC).
• Then insurance industry transformed into monopoly and Oligopolistic state or
public sector insurance industry in India.
WHAT IS INSURANCE ?
• Insurance Is A Means Of Protection From Financial Loss. It Is A Form Of Risk
Management Primarily Used To Hedge Against The Risk Of A Contingent,
Uncertain Loss.
OR
• An Arrangement By Which A Company Or The State Undertakes To Provide A
Guarantee Of Compensation For Specified Loss, Damage, Illness, Or Death In
Return For Payment Of A Specified Premium.
TYPES OF INSURANCE
INSURANCE CURRENT
STATUS
 INTRODUCTION
• The insurance industry of India has 57 insurance companies 24 are in the life insurance business, while 33 are
non-life insurers. Among the life insurers, Life Insurance Corporation (LIC) is the sole public sector company.
There are six public sector insurers in the non-life insurance segment. In addition to these, there is a sole national
re-insurer, namely General Insurance Corporation of India (GIC Re).
• In India, the overall market size of the insurance sector is expected to US$ 280 billion in 2020.
• Gross premium collected by life insurance companies in India increased from Rs. 2.56 trillion (US$ 39.7 billion)
in FY12 to Rs. 7.31 trillion (US$ 94.7 billion) in FY20. During FY12-FY20, premium from new business of life
insurance companies in India increased at a CAGR of 15% to reach Rs. 2.13 trillion (US$ 37 billion) in FY20.
• Overall insurance penetration (premiums as% of GDP) in India reached 3.71% in FY19 from 2.71% in FY02.
• Life insurers reported 14% YoY growth in individual annualized premium equivalent (APE) in October 2020,
compared with 4% YoY in September 2020.
• The market share of private sector companies in the non-life insurance market rose from 15% in FY04 to 56% in
FY21 (till April 2020). In life insurance segment, private players had a market share of 31.3% in new business in
FY20.
• In October 2020, health insurance witnessed an increase in premiums recording 6% growth on y-o-y basis.
Retail health also witnessed a 30% increase in premiumS.
 GOVERNMENT INITIATIVES
• The Government of India has taken number of initiatives to boost the insurance industry. Some of them are as follows:
• As per Union Budget 2019-20, 100% foreign direct investment (FDI) was permitted for insurance intermediaries.
• In December 2020, Uttarakhand announced its plan to offer ‘COVID-19 Insurance Policy’ to international tourists. A
proposal request has been submitted to the Union Tourism Minister, Mr. Prahlad Patel, to introduce special life
insurance policies for foreign tourists.
• On December 03, 2020, as a one-time measure, IRDAI announced that it has authorised up to 5% of the existing
premium rates to change the base premium. This move was to ensure viability and longevity for smooth transformation
of the existing goods.
• In November 2020, in collaboration with PNB MetLife India Insurance Company, India Post Payments Bank (IPPB)
announced the launch of Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) for customers.
• The Insurance Regulatory and Development Authority of India (IRDAI) plans to issue redesigned initial public offering
(IPO) guidelines for insurance companies in India, which are to looking to divest equity through the IPO route.
• IRDAI has allowed insurers to invest up to 10% in additional tier 1 (AT1) bonds that are issued by banks to augment
their tier 1 capital, in order to expand the pool of eligible investors for the banks.
• In October 2020, the Andhra Pradesh rolled out free of cost crop insurance scheme for the state farmers
ADVANTAGES IN INDIA
FUTURE OF INSURANCE INDUSTRY

• The future looks promising for the life insurance industry with several changes in
regulatory framework which will lead to further change in the way the industry
conducts its business and engages with its customers.
• The overall insurance industry is expected to reach US$ 280 billion by the end of
2020. Life insurance industry in the country is expected to increase by 14-15%
annually for the next three to five years.
• The scope of IoT in Indian insurance market continues to go beyond telematics and
customer risk assessment. Currently, there are 110+ InsurTech start-ups operating in
India.
• Demographic factors such as growing middle class, young insurable population and
growing awareness of the need for protection and retirement planning will support the
growth of Indian life insurance.