|| SHANIWAR SAMWAD || 11-06-2022

 Recently, news came from IRDAI that they are planning a small insurance company in both the life and general insurance sector.

Our insurance penetration in life and general insurance is significantly less, i.e. life insurance penetration is just 2.5 to 3 %  and general insurance is just 1% of the total population.

We know by 10 years back  RBI had given some Universal and Small Finance Bank as per head bank account or banking facility to the ordinary citizen was less.

Along with these payment bank licenses, which changed the banking penetration increased, and awareness of the financial products increased.

As said above the insurance product penetration is not as expected. The small insurance company will have less compliance burden than the full-fledged insurance company.

The solvency margin and capital requirement will be less. Just sometime back IRDAI gave authority to the insurance companies to launch products without its permission or allow them to sell, then take its permission.

Our insurance industry is now 20 years old with listed companies in both life, health, and general insurance.

Now, IRDAI is giving licenses in both segments without foreign partners.

The Government and IRDAI  have confidence in our own local company, which means our actuarial science is working as per expected.

The listing of Life Insurance Corporation is in the same direction also the maturity of the industry.

Right now, any changes in the product needed prior permission. Which led to losses for companies due to long and costly.

It is a long pending demand from the industry. The move is in the right direction.

Getting insurance products to the rural market needs modification as per the needs of the particular market.

We are dealing with both urban and rural markets in the same priced product which is not necessarily adaptable.

The rural market which is still nascent is unable to absorb the costly product due to a lack of awareness and services. 

The needs of rural market is different and they need less cost product. 



Location: India

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