The document summarizes recent developments in the Indian insurance sector. It notes that while life insurance penetration has increased from 2.15% in 2001 to 4.6% in 2009, general insurance penetration has remained low between 0.55-0.75%. It discusses issues like the need for insurers to be conservative, challenges in infrastructure funding, and shifting focus of life insurance from risk of dying early to risk of living too long. The summary also highlights regulatory changes by IRDA to standardize proposal forms, introduce new product rules and increase oversight of insurers.

1. Recent Developments in Insurance Sector

2. “I think Insurance Companies should be conservative”
Sh J Harinarayan, Chairman, IRDA
“Banks are finding it difficult to fund
infrastructure projects. Govt need to arrange
fund….”
Sh Gokaran, Dy Governor, RBI

3. Recent
Developments
Year Insurance Penetration- Life/General
2001 2.15%/0.55%
2009 4.60%
“
2010 4.40%/0.71%
2011 3.40%/0.70%
In General Insurance Penetration has been
between0.55 to 0.75

4. Fiscal Insurance Penetration
Life General
2001 2.15% 0.55%
2009 4.60%
2010 4.40% 0.71%
2011 3.40% 0.70
Chairman ,IRDA

5. Recent development
Rreecent rrDevr
Away from Mutuality
General Insurance
*Solvency and Profitability,
*Risk Management and Risk Pricing,
*Underwriting Discipline,
*Detariffing –India Vrs other Countries
*Mutuality and Pooling,
*Special Pool,
*Discipline in Claim Settlement,
*Third Party Liability, ??
(Pay if you can, repudiate if you must)

6. Recent development
Rreecent rrDevr
Away from Mutuality
Life Insurance
*Death now vying for attention with travails of living.
From risk of dying early to risk of living too long,
*Clear polarization/positioning of life insurance plan either as
protection or investment,
*From Traditional to Ulip/SP, India Vrs other countries.
*Meeting reasonable expectation of customers.
*Risk Management Vs Risk Pricing,
As on 31st Oct,2002, Age 30, Term 20, Term Insurance, 1 Lakh SA
LIC HDFC I-PRU TATA ALLZ
1528 1535 2680 3450 2440

7. Distribution
*Demoralized Distributors
*Anybody can sell any product to any person at any price,
*From Insurance peddler to advisor to consultant?
*From 28 million to 15-16 million agents,
*Bancassurance, Corporate agency,
*Insurance Brokers,
*Online distribution,
*WSM etc,

8. Customers
*His dissatisfaction,
*Overwhelmed with choice,
Drowned in data but dying for information.

9. Some Insurers have become smart, IRDA smarter
*Deliberate low rate of annuity,
*Pension without having Immediate annuity product,
*Violation of File and Use,
*Excess payment to distributors,
*Wrongful denial of claim,
*Wrong interpretation of rules,

10. Some Insurers have become smart, IRDA smarter
*Deliberate low rate of annuity,
*Pension without having Immediate annuity product,
*Violation of File and Use,
*Excess payment to distributors,
*Wrongful denial of claim,
*Wrong interpretation of rules,

11. (Over)Enthusiastic IRDA
*Std Proposal and CNA form, full details,
*Standardized Products.. ALL PRODUCTS TO BE REFILED
*Traditional
*HI, 5 yr projection.
*Pension,4.5% -non zero,
*Investment,
*Open Architecture,
*Special Agents,

12. Health Insurance
*TPA experiment,,
*Standalone Insurers,
*PLHA, Oct,2011
*Pricing ?