Overview of the General Insurance Industry in India

Development has been indefinable for the general insurance industry in India. During last three years, the non-life industry has been a slowdown. As per the numbers on gross premium underwritten till November 2014, this sector grew by 9.24 percent.

It grew 12 percent in FY14 and nearly 19 percent in FY13. Development is slow because of economic situation and sector hasn’t planned proper measures to improve insurance penetration. Awareness level is definitely increased but still low for development to pick up.

General Insurance

Have a look on below mentioned reforms initiated by Insurance Regulatory and Development Authority to make positive changes:

·         Long-term Car Insurance Plans

In auto insurance, IRDA allowed insurance companies in India to register long-term compulsory third-party coverage for two-wheelers for a period of 3 years. Majority of two-wheeler owners are not covered because they don’t want to involve in the hassle of policy renewal process every year.

Today, around 70 percent of the two-wheelers owners are uncovered. Hence, a long-term coverage is a more sensible move. In case of private automobiles, nearly 85 percent are covered so that category is not an issue.

·         Hike in Premiums

IRDA showed concerns about costs of non-life plans not being sufficient owing to tough competition after the sector got de-tari general insurance in india

vffed. IRDA has suggested that the burning rate should be the beginning point while costing property, group mediclaim and fire policies from next year. Burning rate is the cost of pure loss or the cost of insurance claims. The industry is moving towards a claim plus pricing mechanism.

It creates concern to those customers who have availed attractive deals on group health insurance and fire policies. Insurance companies will cost equal with the risk factor. The sector is operating on a combined ratio that means the cost is not correct and will get mirrored in the sector’s reluctance to pay claims.

·         Smaller Company Health Coverage

Health insurance guidelines were implemented in 2013 and made policies more customer-friendly. Standardization of terms has brought awareness among buyers and decreased confusion. Now, insurance companies in India have concentrated on insurance products innovation.

Generally, most people still depend on mediclaim policies coverage offered by their employers. Many group health insurance have stopped insuring policyholder’s parents or providing maternity cover.

 Source From  : http://blog.policyboss.com/tag/general-insurance-industry-in-india/