Overview of the Insurance Industry in

India
The Insurance Industry is a major component of the economy by virtue of
the amount of premiums it collects, the scale of its investment and, more
fundamentally, the essential social and economic role it plays by covering
personal and business risks.
The Insurance industry of India consists of 55 Insurance companies of which
24 are in Life Insurance business and 31 are Non-Life Insurers. Among the
life insurers, Life Insurance Corporation of India (LIC) is the sole public sector
company. Apart from that, among the non-life insurers there are Six public
sector insurers.( Including Two specialised insurers belonging to public
sector, namely, Export Credit Guarantee Corporation of India for Credit
Insurance and Agriculture Insurance Company Ltd for Crop Insurance )
The countrys insurance market is expected to quadruple in size over the
next 10 years from its current size of US$ 60 billion. During this period, the life
insurance market is slated to cross US$ 160 billion.
 The general insurance business in India is currently at Rs 78,000 crore (US$ 11.44
billion) premium per annum industry and is growing at a healthy rate of 17 per
cent.

The Indian Insurance market is a huge business opportunity waiting to be

harnessed. India currently accounts for less than 1.5 per cent of the worlds total
insurance premiums and about 2 per cent of the worlds life insurance premiums
despite being the second most populous nation. The country is the fifteenth largest
insurance market in the world in terms of premium volume, and has the potential
to grow exponentially in the coming years.
Government Initiatives

The Budget has made provisions for paying huge subsidies in the premiums
of Pradhan Mantri Fasal Bima Yojana (PMFBY) and the number of
beneficiaries will increase to 50 per cent in the next two years from the
present level of 20 per cent. As part of PMFBY, Rs 9,000 crore (US$ 1.35
billion) has been allocated for crop insurance in 2017-18.
The Insurance Regulatory and Development Authority of India (IRDAI)
recently allowed life insurance companies that have completed 10 years
of operations to raise capital through Initial Public Offerings (IPOs).
Insurance products are also covered under the Exempt-Exempt-Exempt
(EEE) method of taxation, which translates to an effective tax benefit of
approximately 30 per cent on select investments. In 2015, Government
introduced Pradhan Mantri Suraksha Bima Yojna (PMSBY) and Pradhan
Mantri Jeevan Jyoti Bima Yojana (PMJBY) to bring more people under the
insurance cover.
 Government has approved the ordinance to increase Foreign Direct
Investment (FDI) limit in Insurance sector from 26 per cent to 49 per cent
which would further help attract investments in the sector.
Going forward, increasing life expectancy, favourable savings and greater
employment in the private sector is expected to fuel demand for pension
plans. Likewise, strong growth in the automotive industry over the next
decade would be a key driver for the motor insurance market.
By providing tax relief to citizens earning up to Rs 5 lakh (US$ 7500), the
government will be able to increase the number of taxpayers. Life insurers
will be able to sell them insurance products, to further reduce their tax
burden in future. As many of these people were understating their incomes,
they were not able to get adequate insurance cover.
Demand for insurance products may rise as peoples preference shifts from
formal investment products post demonetization.
The Budget has attempted to hasten the implementation of the Digital
India initiative. As people in rural areas become more tech savvy, they will
use digital channels of insurers to buy policies.
The Government of India has taken a number of initiatives to
boost the insurance industry. Few Important Initiatives.

The Union Cabinet has approved the public listing of five Government-owned general
insurance companies and reducing the Governments stake to 75 per cent from 100 per cent,
which is expected to bring higher levels of transparency and accountability, and enable the
companies to raise resources from the capital market to meet their fund requirements.
IRDAI has formed two committees to explore and suggest ways to promote e-commerce in
the sector in order to increase insurance penetration and bring financial inclusion.
IRDAI has formulated a draft regulation, IRDAI (Obligations of Insures to Rural and Social
Sectors) Regulations, 2015, in pursuance of the amendments brought about under section 32
B of the Insurance Laws (Amendment) Act, 2015. These regulations impose obligations on
insurers towards providing insurance cover to the rural and economically weaker sections of
the population
The Government of Assam has launched the Atal-Amrit Abhiyan health insurance scheme,
which would offer comprehensive coverage for six disease groups to below-poverty line (BPL)
and above-poverty line (APL) families, with annual income below Rs 500,000 (US$ 7,500).
Foreign Investment Promotion Board (FIPB) has cleared 15 Foreign Direct Investment (FDI)
proposals including large investments in the insurance sector by Nippon Life Insurance, AIA
International, Sun Life and Aviva Life leading to a cumulative investment of Rs 7,262 crore (US$
1.09 billion).
IRDAI has given initial approval to open branches in India to Switzerland-based Swiss Re,
French-based Scor SE, and two Germany-based reinsurers namely, Hannover Re and Munich
Re.
 Indias current Insurance penetration rate stands at 3.42%, far
below the global average of 6.2%, says an industry report. A
1% rise in insurance penetration translates into 13% reduction
in uninsured losses-an increased investment equivalent of 2%
of national GDP and a 22% reduction in taxpayers
contribution, stated the report Transformative Agenda for
The Indian Insurance Industry and its Policy Framework, jointly
authored by H Ansari, former member (non-life), Irdai, and
leading insurance expert Arun Agarwal. The report also
highlighted the existing regulatory framework of the insurance
industry is insufficient to promote insurance penetration and
density significantly despite the governments objectives to
have a country with full insurance and pension penetration.
Overview of the Insurance Industry
Globally
The global insurance industry is likely to see slightly increased growth by
2018. Better economic prospects in the USA and in many emerging markets
will offset negative factors such as declining growth in the Chinese market.
In the longer term, the emerging markets of Asia will have the greatest
growth potential, and their share of primary insurance premium is expected
to be on a par with that of Western Europe in the next few years.
Michael Menhart, Chief Economist at Munich Re: The economies of many
emerging markets, such as Brazil, but even Russia, are experiencing a
significant recovery. This is leading to increased growth in property-casualty
insurance. In most of the industrialised world in the eurozone, the USA, and
Japan demand has been bolstered by a solid economic environment.
 The emerging markets are gaining more and more weight in the
international insurance industry: the emerging markets share of the
anticipated additional premium volume is expected to rise from 20% in 2016
to 47% by 2025.
Rising standards of living and increasing insurance coverage needs are two
major contributory factors. Interest rate increases and demographic trends
could revitalise the life insurance segment in the industrialized countries as
well.
Opportunities for qualified Insurance
Professionals in Insurance Markets
Operations ( Branch, Cluster, Regional and Zonal)
Finance ( Investment Regulations, Fund Management, Core Accounting
Functions Etc.,)
Underwriting (Financial Underwriting and Specialized Underwriting Different
Segments of Insurance Business)
Claims
Investigation
Compliance and Legal Matters
Policy Servicing
 Insurance Distribution Channels Individual Agency (Insurance Planners)
Corporate Agents, Insurance Brokers
Web Aggregators
Claims Handling Agencies
Information Technology Industry Insurance Domain Subject Matter Expert and Consultants
(Business Analyst)
Common Service Centers
Third Party Administrators (TPAs) -Health Insurance Claims Servicing
Insurance Surveyors and Loss Assessors/Adjusters
Self Regulatories Body and Professional Associations
Insurance Studies Faculties and Educator
Consultant with State/Central Government for Insurance Matters
Reinsurance
Grievance Handling
Insurance Repositories
Consulting in Legal Firms
Etc
 Somandy & Associates Advocates which specializes in
Insurance Litigations Claims that on an average , Insurance
Litigations could stretch upto as long as 7 Years or more in
India. So there is dire need for One body that would take
up all Insurance related court cases such that the pace of
resolution could become much quicker.
Registration and Exam Calendar for
2017
Steps Details Dates

1. Pay online fees for registration/ Online Registration, Enrollment, Change th

7 to 16th August,2017
paper enrollment * of Subject Dates

2. Book Centre, date & time of the

Slot / Subject Booking Dates 23rd Aug to 2nd Sept,2017
examination i.e. Slot Booking.

Saturday, 09th Sept., 2017

Sunday, 10th Sept.,2017

3. Examination window period available
Examination Dates
for those who book their slot.
Saturday, 16th Sept., 2017

Sunday, 17th Sept., 2017