Insurance in India
At present, there are 24 life insurers in India. The IRDA has recently taken away the tariffs of the interest rates and this has provided insurers greater independence when it comes to deciding the price of their insurance policies. The insurance industry has also become more competitive as a result.
Yet another important factor affecting this sector has been the recent financial meltdown.
India insurance industry growth in last few years
India currently has 57 insurance companies.
- LIC is the only public sector life insurance company.
- The market size of the insurance sector in 2020 is US$ 280 billion.
- The market share of private companies in the general health insurance market was 48.03% in FY20.
- Health insurance companies in the non-life insurance sector increased by 41% due to the COVID-19 Pandemic.
- India is the second-largest insurance technology market in Asia-Pacific.
- LIC recorded 10.11% growth in FY21, with an income of RS. 56,406 crores.
- Max life insurance launched the ‘Max Life Saral Pension' in May 2021.
- India is ranked 10th in the world in Life insurance.
India insurance industry - market share of leading companies
The following table shows the market share of top insurers in India in the period till April 2011:
| Company | Approximate market share |
|---|---|
| LIC | 50.00% |
| SBI Life | 11.50% |
| HDFC Life | 9.70% |
| ICICI Prudential | 5.80% |
| Max Life | 4.80% |
| Tata AIA | 3.10% |
| Bajaj Allianz | 3.10% |
| Birla Sunlife | 2.20% |
| Kotak Mahindra | 1.80% |
| PNB Met Life | 1.40% |
| India First | 1.30% |
| Others | 5.30% |
In terms of policies sold following are the top insurers in India(2020-2021)
| Company | Policies sold till December 2011 (approximate figure) |
|---|---|
| LIC | 9269392 |
| TATA AIA Life | 261319 |
| Shriram Life | 145514 |
| SBI life | 884372 |
| Reliance Nippon Life | 112635 |
| PNB Metlife | 139922 |
| Max Life | 367673 |
| Kotak Mahindra Life | 180294 |
| Aditya Birla Sun | 154238 |
| ICICI Prudential Life | 379520 |
| HDFC Life | 592360 |
India insurance industry - some key findings
Following are some important findings from the World Bank regarding the condition of the insurance industry in India:
The premium for the insurance industry for FY21 stands at US$31.9 Billion.
There are over 110 InsurTech start-ups in India as of 2020.
Factors such as decreasing healthcare, Increasing health problems, high medical expenses and public fear instilled by the pandemic are driving people to buy life insurances. Increasing the insurance companies’ growth.
India insurance industry major problems
Following are some of the major problems plaguing the insurance industry in India:
- Focus on actuarial pricing
- Regulatory misunderstanding
- Investment regulations
- Solvency regulation
- Claims settlement procedures
- Data clarity
- Distribution channel issues
India insurance industry contribution to GDP
Experts believe that around the world the insurance industry contributes around 4.5% to national GDPs. They have questioned the logicality of opinions that in India the contribution can be higher saying that there are other important sectors like education, defence, and health that cannot be undermined in this context.
They have ruled out possibilities that the sector can contribute 10% to India's GDP. The Chairman of IRDA, Hari Narayan has ruled out any such possibility asking if India's GDP growth will be that much in the next few years ahead.
The IRDA states that in India land and gold are more preferred as forms of investment. Narayan feels that if the insurance sector is to do well in terms of contribution to GDP then more people should be convinced about its capability to provide good ROI (return on investment).
Why are more people taking insurance policies?
One of the major reasons for an increasing number of people availing of insurance policies in India is the growing level of awareness. People nowadays value their lives, their health, and their families even more than before given the tough economic circumstances and so want to make sure that everything is fine even if they are not there.
Yet another reason for the growing popularity of insurance policies is the benefit of tax exemption that is provided to family-oriented and individual plans. The majority of the private insurers also provide lucrative returns and are now being availed by a section of the Indian society with greater disposable earnings.
There is an aspect of psychological comfort attached to the insurance policies as well - whenever insurance is availed the policyholder can be more or less assured of a safe future for that particular part of his or her life.
Top Insurance Policies
Following are the featured insurance policies of various insurers in India:
| Company | Product |
|---|---|
| SBI | SBI life shield |
| HDFC | HDFC life click 2 protect plus |
| Aviva | Aviva i-life |
| Care Plus | Future Generali care plus |
| Aditya Birla Sun | Birla sun life BSLI |
| LIC | LIC Jeevan Pragati plan |
| Max Life | Max Life Online Term Plan Plus Basic Life Cover |
| ICICI | ICICI Prudential iProtect Smart |
| Bharti Axa | Bharti Axa Life Elite Secure |
- Aviva Life Insurance
- Bajaj Allianz Life Insurance
- Birla Sun Life Insurance
- HDFC Standard Life Insurance
- ING Vysya Life Insurance
- Life Insurance Corporation of India
- Max Life Insurance Company
- MetLife India Insurance
- Reliance Life Insurance
- Sahara India Life Insurance
- SBI Life Insurance
- Tata AIG Insurance Company Ltd
- Om Kotak Mahindra Insurance
Company
- Agriculture Insurance Company of India Ltd
- Amsure Insurance
- ANZ Insurance
- Cholamandalam General Insurance
- Employee's State Insurance Corporation
- ICICI Lombard General Insurance
- IFFCO-Tokio General Insurance
- National Insurance Company Ltd
- Oriental Insurance Company Ltd
- Peerless Smart Financial Solutions
- Royal Sundaram Alliance Insurance India
- Tata AIG Insurance Company Ltd
- Export Credit Guarantee Corporation of
India Ltd
