INSURANCE

SECTOR IN INDIA
 WHAT IS INSURANCE ??
 Insurance is a co-operative device to spread the
loss caused by a particular risk over a number
of persons who are exposed to it and who agree
to insure themselves against the risk.
TYPES OF INSURANCE

INSURANCE

LIFE GENERAL
INSURANCE INSURANCE
 HISTORY
1818 - Oriental Life Insurance Company – 1 st Insurance
Company.

1870 - Bombay Mutual Life Assurance Society – 1st Life

Insurance Company.

1912 - The Indian Life Assurance Companies Act enacted

the 1st Law to Regulate the Life Insurance Business.

1928 - The Indian Insurance Companies Act enacted to

enable the government to collect statistical information
about both life & non-life insurance businesses.
1938: Earlier legislation consolidated & amended the
Insurance Act with the objective of protecting the interests
of the insuring public.

1956: 245 Indian & foreign insurers & provident societies

are taken over by the central government & nationalized.

LIC formed by an Act of Parliament, viz. LIC Act, 1956,

with a capital contribution of Rs. 5 crore from the
Government of India.

The first General Insurance Company established in the year

1850 in Calcutta by the British.
1999 : Insurance Regulatory and Development
Authority Act introduced.

Foreign investment allowed, capped at

26% holding in the Indian insurance
companies.

2006 : Actuaries Act passed.

 IRDA
 In 1993 Government setup a committee under
chairmanship of RN Malhotra ,former Governor
of RBI for reforms in Insurance sector.
 Recommendations are :-
 IRDA was constituted as an autonomous body
to regulate and develop the insurance industry.
 Foreign companies are allowed up to 26% of
paid up capital and can operate with an Indian
company.
DUTIES, POWERS AND FUNCTIONS OF
IRDA

 To regulate, promote and ensure orderly growth of

the insurance business and re-insurance business.
 Issue to the applicant a certificate of
registration,renew, modify, withdraw, suspend or
cancel such registration .
 Protection of the interests of the policy holders in
matters concerning assigning of policy, nomination
by policy holders, insurable interest, settlement of
insurance claim, surrender value of policy and
other terms and conditions of contracts of
insurance
INVESTMENT…..
 Assets of insurer should be invested as …
 25% in Government securities(including deposit in
RBI),
 At least 25% in Government/other approved
securities;
 Up to 15% of the controlled fund of the insurers
can be invested in other insurance;
 Up to 25% of the assets ofGIC can be invested in
other investment;
 No fund of policy holder can be invested outside
India.
 FACTS
 US$41 billion industry

 Growing at a rapid pace of 32-34% annually

 75% population has no insurance

 Adds 7% to country’s GDP

 47 companies currently operating in India

 A minimum capital of US$20 million is required to

set up an insurance company.
KEY PLAYERS
MARKET SHARE
 THANK
YOU
 Presented by
 Murali Krishna (10078)
 Praveen Pardesi (10085)
 Brijesh Gupta (10069)
 Atul Kumar Singh (10066)