In a bid to increase reach, insurance regulator Insurance Regulatory and Development Authority of India (IRDAI) has asked companies to follow the banking industry’s strategy for inclusion by adopting individual states as lead insurers.
The regulator has moreover set goals in terms of insurance penetration for the life and non-life industry. IRDAI chairman Debashish Panda organised the first of his proposed bi-monthly meeting with insurance chiefs — Bima Manthan — this week in Hyderabad.
Along with being advised on boosting the growth rate, insurers were individually given indicative targets along with unique states and UTs to lead on in the meeting. There was also a presentation from the Insurance Information Bureau on enhancing its role and also its corporatisation.
The organisation was established by the insurance regulatory and registered as an independent society under the Andhra Pradesh Societies Act. A repository of industry data, the IIB provides benchmarks for insurance companies.
Life insurance penetration (ratio of premium to GDP) was 3.2 per cent while that of non-life was 1 per cent, as per Swiss Re’s Sigma report. The world average for life is 3.3 per cent and 4.1 per cent for non-life.
The life insurance penetration in India is more because of high component of retirement savings while the protection component is lower.
Meanwhile, companies have been asked by the regulator to reach G7 level of insurance penetration for life companies and at least double the insurance penetration of non-life companies. In the meeting, the IRDAI chairman also suggested the creation of a working group including the officials of NHA, the insurance regulator and representation from the industry to utilise the claims exchange.
