DEPARTMENT OF BUSINESSADMINISTRATION

ABES ENGINEERING COLLEGE, Ghaziabad

PRESENTATION ON

Insurance industry in indiaPresented By:

Anchal GoelMeenakshi Prasar

INDUSTRY IN INDIA

A financial device or contract to mitigate or eliminate risk of loss to life and property.

Form of risk management used to hedge against the risk of a contingent or uncertain loss.

Insurance can be defined as- A legal contract b/w two parties whereby one party (insurer) undertakes to pay a fixed amount of money on the happening of a particular event, which may be certain or uncertain.

Premium: The other party (insured/ assured) pays in exchange a fixed sum of money.

Policy: The document which embodies the contract.

INSURANCE

General characteristics

Risk sharing: A device to share the financial loss which may be afflict the individual or his/ her family members.

Risk assessment Cooperation: among the large number of persons who come

together voluntarily to share the financial loss. Payment at the time of contingency: For payment to be made at the

time of contingency. Quantum of compensation: value of compensation depends on the

extent of loss suffered by the insured from a particular risk. Larger the number, Better the care: small no. of insured- higher

premium- unaffordable- unpopular.

PRINCIPLESPrinciple of Insurable interest. Principle of Utmost Good Faith. Principle of Indemnity. Principle of Subrogation. Principle of Contribution. Principle of Causa Proxima (Nearest Cause). Principle of Mitigation of Loss.

TYPES OF INSURANCE

LIFE INSURANCE

GENERAL INSURANCE

LIFE INSURANCE• TERM POLICY• WHOLE LIFE POLICY• ENDOWMENT POLICY• MONEY BACK POLICY• ANNUITY• UNIT LINKED

INSURANCE POLICY

GENERAL INSURANC• FIRE INSURANCE• MARINE INSURANCE• MORTOR INSURANCE• ACCIDENT INSURANCE• CREDIT INSURANCE• PUBLIC LIABILITY INSURANCE• PROPERTY/ CASUALTY• FIDELITY INSURANCE• WORKMEN COMPENSATION• UNEMPLOYMENT INSURANCE• NATIONAL HEALTH INSURANCE• CASH TRANSIT INSURANCE

The Insurance Act, 1938 to govern all form of insurance and to provide strict control over insurance business.

Insurance Regulatory And Authority Act, 1999 (to provide) for the establishment of an authority to protect the interest of the holder of insurance policy, to regulate, promote and ensure orderly growth of insurance industry and for matter connected therewith or incidental thereto and future to amend the Insurance Act, 1938, the Life Insurance Corporation Act, 1956 and the general insurance business (Nationalization) act, 1972.

The Actuaries Act, 2006: An Act to provide for regulating and developing the profession of Actuaries and for matters connected therewith or incidental thereto.

ACTS GOVERNING INSURANCE

Insurance Regulatory & Development Authority is regulatory and development authority under Government of India in order to protect the interests of the policyholders and to regulate, promote and ensure orderly growth of the insurance industry.

INSURANCE REGULATORY &DEVELOPMENT AUTHORITY (IRDA)

INSURANCE ORGANISATION

There are mainly two large organisations in indian insurance industry:

i) ii)

12

STRUCTURE OF LIC

Historical Perspective(i) Prior to 1956 242 companies operating(ii) 1956 – 2001 Nationalisation – LIC

Monopoly player Government control

(iii) 2001 Opened up sector(iv) Present structureFully owned by Government

PRIVATE PLAYERS

1. Bajaj Allianz Life Insurance Co. Ltd.2. Birla Sun Life Insurance Co. Ltd. (BSLI)3. HDFC Standard Life Insurance Co. Ltd. (HDFC STD LIFE)4. ICICI Prudential Life Insurance Co. Ltd. (ICICI PRU)5. ING VYSYA Life Insurance Co. Ltd. (ING VYSYA)6. Max New York Life Insurance Co. Ltd. (MNYL)7. MetLife India Insurance Co. Pvt. Ltd. (METLIFE)8. Kotak Mahindra Old Mutual Life Insurance Co. Ltd.9. SBI Life Insurance Co. Ltd. (SBI LIFE)10. TATA AIG Life Insurance Co. Ltd. (TATA AIG)11. AMP Sanmar Assurance Co. Ltd. (AMP SANMAR)12. Aviva Life Insurance Co. Pvt. Ltd. (AVIVA)13. Sahara India Life Insurance Co. Ltd. (SAHARA LIFE)

CONTRIBUTION TO INDIAN ECONOMY

Life Insurance is the only sector which garners long term savings

Spread of financial services in rural areas and amongst socially less privileged

Long term funds for infrastructureStrong positive correlation between

development of capital markets and insurance /pension sector

Employment generation

GENERAL INSURANCE CORPORATION OF INDIA

The government nationalised the general insurance business in1972.

107 insurers, including branches of foreign companies operating in india, were amalgamated and grouped into four companies namely: The national insurance company limited (kolkata); The new india Assurance co. ltd.(mumbai); The oriental insurance co. ltd. (delhi); and The united india Assurance co. ltd.(chennai).

PLAYERS IN INDUSTRYLife Insurance General Insurance

Life Insurance Corporation of India. General Insurance Corporation of India. 1. Oriental Insurance Company Ltd. 2. New India Assurance Company Ltd. 3. National Insurance Company Ltd. 4. United India Insurance Company Ltd.

ICICI Prudential Life Insurance Ltd. Bajaj Alliaz General Insurance Company Ltd.

Tata AIG Life Insurance Corporation Ltd.

Reliance General Insurance Company Ltd.

ING Vysya Life Insurance Corporation Ltd.

Tata AIG General Insurance Company Ltd.

Kotak Mahindra Life Insurance Corporation Ltd.

Royal Sundaram Alliance Insurance Company Ltd.

The Insurance Industry in 2015: Trends and InnovationPosted by Parker Beauchamp on Feb 18, 2015

4 Important Insurance Trends for 2015: Growing connectivity between the real and digital worlds will determine major and innovative trends in 2015. Insurance companies will continue to invest in digital tools needed to enhance products and services delivered to policyholders, increase operations efficiencies, and better connect networks of partners and providers. Below are four technologies insurance companies should strive to integrate in 2015:

i) Big Data Analysis : Analysis based programs can help insurers improve their efficiency in a variety of ways, such as assessing fraudulent claims or improving the rate at which business changes to meet changing client needs and expectations.

ii) Mobile: Thanks to advancements in mobile technology, digitizing life activities  become the new standard in 2014. From tablets to mobile phones and the up-coming smart watches, consumers are looking for ways to further mobilize their spending and management practices in nearly every aspect of life.

Most major insurance companies already offer mobile apps for easy access to accounts, insurance quotes, claims support or even roadside assistance. The key in 2015 will be to further connect policyholders to the insured in order to more quickly exchange information and expedite the claim report and response process.

iii) Re-Engineering Underwriting : Assessing income risk is more thorough than ever. Using spatial data, such as information from Google Maps to public statistics on crime, education, income and health care, will help insurers assess risks and liabilities in new and sophisticated ways in the coming year.

iv) Cloud/Client Computing: About half of insurance carriers today are “in the cloud,” and this tech trend should continue to grow this year. Cloud computing is a tech term for the practice of sharing a network of remote Internet servers to store, manage and process information. Operating in the cloud enables organizations to optimize IT and will prepare businesses for everything from product growth to potential data loss disasters.