A CII-EY Report on the Insurance Industry titled ‘Building Growth, Building Value’ recommends chasing efficiency in distribution by finding greater synergy among the different channels. This will help in well-rounded industry growth and enable maximum value creation for all the stakeholders. The report also states that insurers must be careful in identifying the right ways to employ additional capital inflows that they may receive over the next few years with capital infusion from the foreign partners.
Study of promotional strategy of icici prudential life insurance co ltdProjects Kart
This document is a certificate of participation for a student named Rajni Kant who completed a project titled "Advertisement Effectiveness Study (With reference to Life Insurance)" for the ICICI Prudential Life Insurance Co. Ltd. The project was conducted as part of the Post Graduate Program in Management and Insurance at the International School of Business and Media in Noida, India. The certificate certifies that Rajni Kant successfully completed the project, which analyzed and evaluated the media strategy of ICICI Prudential Life Insurance Co. Ltd.
The document provides information about a summer training project report submitted for a Masters in Business Administration degree. It includes an acknowledgements section thanking various individuals for their assistance and guidance. The document outlines the objectives of studying consumer behavior and customer satisfaction towards ICICI Prudential Life Insurance products. It discusses the research methodology used, including collecting primary and secondary data through questionnaires, interviews, books, and websites. The document appears to be a report summarizing the results of research conducted on consumer perceptions and satisfaction with ICICI Prudential Life Insurance.
This document is a project report submitted by Soumeet D. Sarkar for his M.Com program. It provides an overview of The Oriental Insurance Company Limited, including its history, popular policies, SWOT analysis, and product profile. The report contains chapters on data analysis and collection, including comparative balance sheets and profit/loss accounts, as well as ratios and comments. It aims to provide insight into The Oriental Insurance Company and the insurance industry in India.
Privatisation of life insurance sector in indiaiicecollege
This project is related to life insurance business in India. This study is mainly related to privatization of life insurance sector. LIC was monopoly in insurance sector till 2000.
The decision by IRDA to grant licences to private pledgers in life and non-life sector is expected to increase the insurance business in India. This is bound to board to force existing player to become more competitive thus the buyer can now expect better deals form its insurance agents.
This document provides information about Shiva Nihar's summer internship report on mutual funds with HDFC Ltd. It includes a title page, certificate from his internal guide, acknowledgements, declaration, table of contents, and introduction chapter. The introduction provides an overview of mutual funds, including what they are, their advantages, categories, and organizational structure. It explains that a mutual fund pools money from investors and invests it on their behalf in stocks, bonds, and other securities. The main advantages discussed are diversification, professional management, and lower costs through bulk transactions.
The document discusses new IRDA guidelines for unit-linked insurance policies (ULIPs). Key changes include: 1) Minimum sum assured of 50% of annual premium or 5 times annual premium. 2) Lock-in period for top-up premiums increased to 3 years from investment. 3) Withdrawals only allowed after 3 years except in last 2 years before death. The guidelines aim to increase consumer protection by reducing risk and improving transparency of charges.
A Project Report on - FINANCIAL PERFORMANCE OF LIC AND PRIVATE SECTOR LIFE...Karteek Chedadeepu
FINANCIAL PERFORMANCE OF LIC AND PRIVATE SECTOR LIFE INSURANCE COMPANIES IN INDIA
- A COMPARATIVE ANALYSIS USING CARAMEL MODEL..
This is my project report. I did my project on the financial performance of private and public sector of Life insurance companies India by using CARAMEL model.
The case study discusses Life Insurance Corporation of India's (LIC) strategy reforms to compete with new entrants in the insurance sector after 2000. LIC focused on training its large sales force, adopting new technologies, reengineering business processes, and strengthening its promotional strategy. For sales force training, LIC recruited more agents, provided mandatory professional training, partnered with IIM for IT skills, and offered laptops at concession prices. Technologically, LIC used a WAN and IVRS for improved customer service. It reengineered processes to reduce claim processing times. Promotionally, LIC increased advertising spending, used impactful slogans, and reduced ad agencies to ensure clear messaging.
Study of promotional strategy of icici prudential life insurance co ltdProjects Kart
This document is a certificate of participation for a student named Rajni Kant who completed a project titled "Advertisement Effectiveness Study (With reference to Life Insurance)" for the ICICI Prudential Life Insurance Co. Ltd. The project was conducted as part of the Post Graduate Program in Management and Insurance at the International School of Business and Media in Noida, India. The certificate certifies that Rajni Kant successfully completed the project, which analyzed and evaluated the media strategy of ICICI Prudential Life Insurance Co. Ltd.
The document provides information about a summer training project report submitted for a Masters in Business Administration degree. It includes an acknowledgements section thanking various individuals for their assistance and guidance. The document outlines the objectives of studying consumer behavior and customer satisfaction towards ICICI Prudential Life Insurance products. It discusses the research methodology used, including collecting primary and secondary data through questionnaires, interviews, books, and websites. The document appears to be a report summarizing the results of research conducted on consumer perceptions and satisfaction with ICICI Prudential Life Insurance.
This document is a project report submitted by Soumeet D. Sarkar for his M.Com program. It provides an overview of The Oriental Insurance Company Limited, including its history, popular policies, SWOT analysis, and product profile. The report contains chapters on data analysis and collection, including comparative balance sheets and profit/loss accounts, as well as ratios and comments. It aims to provide insight into The Oriental Insurance Company and the insurance industry in India.
Privatisation of life insurance sector in indiaiicecollege
This project is related to life insurance business in India. This study is mainly related to privatization of life insurance sector. LIC was monopoly in insurance sector till 2000.
The decision by IRDA to grant licences to private pledgers in life and non-life sector is expected to increase the insurance business in India. This is bound to board to force existing player to become more competitive thus the buyer can now expect better deals form its insurance agents.
This document provides information about Shiva Nihar's summer internship report on mutual funds with HDFC Ltd. It includes a title page, certificate from his internal guide, acknowledgements, declaration, table of contents, and introduction chapter. The introduction provides an overview of mutual funds, including what they are, their advantages, categories, and organizational structure. It explains that a mutual fund pools money from investors and invests it on their behalf in stocks, bonds, and other securities. The main advantages discussed are diversification, professional management, and lower costs through bulk transactions.
The document discusses new IRDA guidelines for unit-linked insurance policies (ULIPs). Key changes include: 1) Minimum sum assured of 50% of annual premium or 5 times annual premium. 2) Lock-in period for top-up premiums increased to 3 years from investment. 3) Withdrawals only allowed after 3 years except in last 2 years before death. The guidelines aim to increase consumer protection by reducing risk and improving transparency of charges.
A Project Report on - FINANCIAL PERFORMANCE OF LIC AND PRIVATE SECTOR LIFE...Karteek Chedadeepu
FINANCIAL PERFORMANCE OF LIC AND PRIVATE SECTOR LIFE INSURANCE COMPANIES IN INDIA
- A COMPARATIVE ANALYSIS USING CARAMEL MODEL..
This is my project report. I did my project on the financial performance of private and public sector of Life insurance companies India by using CARAMEL model.
The case study discusses Life Insurance Corporation of India's (LIC) strategy reforms to compete with new entrants in the insurance sector after 2000. LIC focused on training its large sales force, adopting new technologies, reengineering business processes, and strengthening its promotional strategy. For sales force training, LIC recruited more agents, provided mandatory professional training, partnered with IIM for IT skills, and offered laptops at concession prices. Technologically, LIC used a WAN and IVRS for improved customer service. It reengineered processes to reduce claim processing times. Promotionally, LIC increased advertising spending, used impactful slogans, and reduced ad agencies to ensure clear messaging.
Epgp term v mos group assignment april 2010Rajendra Inani
This document provides an analysis of the Indian health insurance market and ICICI Lombard General Insurance Company. It discusses the growing market size and factors driving future growth. It also outlines ICICI Lombard's range of health insurance products and services, competitors in the market, collaborators, and recommendations to further grow their market share in health insurance.
ICICI Prudential Life Insurance is a joint venture between ICICI Bank and Prudential plc. It has over 13,000 employees and offers a wide range of insurance products including term plans, wealth plans, child plans, health plans, and retirement plans. The company has maintained its dominant position among private life insurers in India and has a vision to be the dominant life, health, and pensions player built on trust and world-class service.
Insurance as a investment tool @ icici bank project report mba financeBabasab Patil
This document provides an overview of insurance as an investment tool with regards to ULIPs at ICICI Prudential Life Insurance Company Ltd in Hubli. It discusses the objectives of studying ULIPs, introduces ICICI Prudential and the importance of insurance in the Indian financial system. It also provides background on the history and regulations of insurance in India, including the role and functions of the Insurance Regulatory and Development Authority.
This document provides an overview of the life insurance industry in India. It discusses the history of insurance in India dating back to references in ancient texts from Manu and Kautilya. The first modern life insurance company was established in 1818. The industry was dominated by foreign firms until the 1950s when the government nationalized life insurance and established the Life Insurance Corporation of India in 1956. The regulatory framework for insurance continued to develop with acts passed in 1912, 1928, and 1938. Liberalization began in the 2000s with the establishment of the Insurance Regulatory and Development Authority in 2000 and the opening of the industry to private companies in 2000.
This document provides an overview of Life Insurance Corporation of India (LIC), including its formation, vision, mission, objectives, functions, and products/services. LIC was formed in 1956 through the nationalization of India's private insurance industry. It aims to widely provide affordable life insurance coverage. Its functions include carrying out life insurance business, investing funds, and engaging in other related businesses. LIC offers various insurance plans, pension plans, and group schemes to customers.
HDFC Standard Life Insurance is a leading private life insurance company in India. It is a joint venture between HDFC, a major housing finance company, and Standard Life of the UK. The document discusses HDFC Standard Life's products, growth, awards, and expansion efforts. It also provides background on the insurance industry in India, including key regulations and the growth of private insurers. HDFC Standard Life aims to increase its market share through new products, advertising, and improving its sales techniques.
This document provides an overview and executive summary of a project report on IDBI Federal Life Insurance Company. It includes sections on the organization overview, various departments like marketing, service, and HR. It discusses the company's history, mission, vision, competitors and products. Research methodology, objectives, and data collection sources are also mentioned. The document contains details of the project outline, chapters to be covered, and acknowledgements.
Project on CREDIT INSURANCE by Akshat MahendraAKSHAT MAHENDRA
Project Report on CREDIT INSURANCE
Project on CREDIT
BBI SEM 6 Project
Project Report on CREDIT
Semester VI BBI Blackbook Project 100 Marks
Project Report on INSURANCE
Semester 6 BBI Blackbook Project 100 Marks
Project on INSURANCE
Project on Finance
Project on Finance BBI
B.Com (BANKING and INSURANCE)
Project for BBI
Project on Finance BANKING INSURANCE
BANKING & INSURANCE
Semester 6 B.Com BANKING and INSURANCE Blackbook Project 100 Marks
BANKING and INSURANCE
Semester 6 BANKING and INSURANCE Blackbook Project 100 Marks
B.Com BANKING and INSURANCE
The document appears to be a research report submitted by Emmanuel Savio to his professor Renu Tiwari at St. Andrews College exploring life insurance products offered by the Life Insurance Corporation of India (LIC). It provides background on LIC and describes several of its popular life insurance plans, outlining their key features, benefits, eligibility requirements, and other details. The report was submitted to fulfill research objectives for Emmanuel's Bachelor of Commerce degree in the academic year 2011-2012.
project on ulip vs mutual funds.corporate bonds,debt fund,etcjyotish bharti
This document provides an overview of the insurance industry in India. It discusses the history and growth of the industry including the liberalization that allowed private players to enter in 2000. It introduces some of the major players in life and non-life insurance such as LIC, HDFC Life, ICICI Prudential and discusses factors that affect the industry like customers, competitors, technology. It also summarizes trends in the industry including rising demand for pension plans, bancassurance, and changing customer expectations around service and customization.
I express my sincere and deepest gratitude to mrAnuj Chauhan
The document is an internship report submitted to Mrs. Sunita Dwivedi for the Post Graduate Program in Marketing-Finance at ICICI Prudential Life Insurance Pvt. Ltd. It discusses the need for insurance and analyzes the life insurance industry and companies in India from 2000-2010. It provides profiles of the public sector Life Insurance Corporation of India and 22 private life insurers. Tables show the growth in offices of major private insurers from 2000-2010.
A project report on risk and return analysis of bharti axa productsKirankumar Kiri
The document provides an overview of risk and return concepts in finance and introduces the objectives, scope and methodology of a study on risk and return analysis of insurance products. It discusses that return is what an investor earns from an investment, while risk is the uncertainty associated with the investment. The potential return rises with increased risk. The study aims to maximize return by balancing risk, analyze risks of different insurance products, and do a comparative study of risk and return of insurance products. It will be limited to insurance products and use primary and secondary data collection.
This document provides an overview of the life insurance industry in India. It discusses the history and development of life insurance in India from its origins in 1818 to the present regulatory environment. Key events include the establishment of the Life Insurance Corporation of India in 1956, which had a monopoly for many years, and reforms in the 2000s that opened the industry to private companies and established the Insurance Regulatory and Development Authority (IRDA) to oversee the industry. The document also examines the contributions and growth potential of the life insurance sector for the Indian economy.
This document provides an overview of IDBI Federal Life Insurance, including:
1) IDBI Federal Life Insurance is a joint venture between IDBI Bank, Federal Bank, and Ageas insurance. It offers various insurance products to customers in India.
2) Information is provided on the partner organizations IDBI Bank, Federal Bank, and Ageas insurance.
3) An organizational structure of IDBI Federal Life Insurance is shown, including the CEO and heads of different divisions.
ING Vysya Life Insurance provides life insurance products and services in India. It has over 21,000 advisors working from 140 branches across 74 cities. The company aims to offer customers comprehensive protection, savings, investment, and retirement plans. It uses a tool called LifeMaker to help customers choose plans that suit their needs and life stage. Key partners include ING Group, Exide Industries, Gujarat Ambuja Cements, and Enam Group.
This document provides a summary of a research paper that compares the public and private life insurance companies in India. It begins with an abstract that outlines the objectives of comparing customer perceptions of service quality and analyzing the financial performance of public versus private insurers. The introduction provides background on the growth of the insurance sector in India. It then examines the performance of the public insurer LIC and private insurers based on financial ratios like liquidity, solvency, and leverage. The study found that LIC has stronger financial performance and stability compared to private insurers.
This document is a research report on customer preferences towards child education plans offered by Life Insurance Corporation of India (LIC). It includes an introduction discussing how customer perceptions can change over time. It then provides background on the benefits of life insurance and LIC's child education plans. The report contributes that LIC contributes 4% to India's gross domestic product and pays large dividends to the government. It concludes with an executive summary stating the report studies customer perceptions of insurance providers in Bhilai to help private and public insurers improve standards and customer facilities.
The document provides background information on the insurance industry in India. It discusses how the industry was nationalized in 1956 but opened up to private players in the 1990s. Currently there are 52 insurance companies operating in India, with the life insurance industry experiencing a decline in growth of 1.57% in 2011-12. The insurance sector has significant growth potential as penetration rates remain low compared to other Asian countries, providing opportunities for interested companies.
This document provides an overview of the insurance industry in India and IDBI Federal Life Insurance. It discusses the history of insurance in India dating back to ancient texts. Key developments include private players entering the market in 2000 which has led to growth. The future of the industry is promising with projections of the market reaching $63 billion by 2014 and insurance penetration increasing to 5-6% over the next 5 years. IDBI Federal Life Insurance aims to increase its brand awareness and market share through new products and improved services.
This document provides an overview of Reliance Life Insurance Company (RLIC) and the Indian life insurance industry. It discusses RLIC's profile, including its ownership structure and financial performance. It also provides background on the development of the Indian life insurance industry, from its origins in the 1800s to nationalization in 1956 and subsequent opening to private companies. The document outlines RLIC's vision, mission, goals and recent achievements. It concludes with a brief literature review on the concepts of insurance and the history and development of the insurance industry in India.
The insurance sector in India is governed by various acts and regulations. It has grown significantly in recent decades but penetration remains low, with over 80% of the population lacking life or health insurance. Reforms including allowing private companies and 26% foreign ownership have increased competition and improved products. The regulatory framework continues developing to promote growth while protecting policyholders.
11.service quality assessment in insurance sector a comparative study between...Alexander Decker
This document summarizes a research study that assessed service quality in the insurance sectors of India and China. The study developed a valid and reliable instrument to measure customer perceptions of service quality across six dimensions: assurance, personalized financial planning, competence, corporate image, tangibles, and technology. While both countries operate in similar service environments, the study found that customer responses to these service quality components differed between the two countries. The document provides background on the growth of the insurance industries in India and China and reviews literature on previous studies measuring service quality in various service sectors and countries.
Epgp term v mos group assignment april 2010Rajendra Inani
This document provides an analysis of the Indian health insurance market and ICICI Lombard General Insurance Company. It discusses the growing market size and factors driving future growth. It also outlines ICICI Lombard's range of health insurance products and services, competitors in the market, collaborators, and recommendations to further grow their market share in health insurance.
ICICI Prudential Life Insurance is a joint venture between ICICI Bank and Prudential plc. It has over 13,000 employees and offers a wide range of insurance products including term plans, wealth plans, child plans, health plans, and retirement plans. The company has maintained its dominant position among private life insurers in India and has a vision to be the dominant life, health, and pensions player built on trust and world-class service.
Insurance as a investment tool @ icici bank project report mba financeBabasab Patil
This document provides an overview of insurance as an investment tool with regards to ULIPs at ICICI Prudential Life Insurance Company Ltd in Hubli. It discusses the objectives of studying ULIPs, introduces ICICI Prudential and the importance of insurance in the Indian financial system. It also provides background on the history and regulations of insurance in India, including the role and functions of the Insurance Regulatory and Development Authority.
This document provides an overview of the life insurance industry in India. It discusses the history of insurance in India dating back to references in ancient texts from Manu and Kautilya. The first modern life insurance company was established in 1818. The industry was dominated by foreign firms until the 1950s when the government nationalized life insurance and established the Life Insurance Corporation of India in 1956. The regulatory framework for insurance continued to develop with acts passed in 1912, 1928, and 1938. Liberalization began in the 2000s with the establishment of the Insurance Regulatory and Development Authority in 2000 and the opening of the industry to private companies in 2000.
This document provides an overview of Life Insurance Corporation of India (LIC), including its formation, vision, mission, objectives, functions, and products/services. LIC was formed in 1956 through the nationalization of India's private insurance industry. It aims to widely provide affordable life insurance coverage. Its functions include carrying out life insurance business, investing funds, and engaging in other related businesses. LIC offers various insurance plans, pension plans, and group schemes to customers.
HDFC Standard Life Insurance is a leading private life insurance company in India. It is a joint venture between HDFC, a major housing finance company, and Standard Life of the UK. The document discusses HDFC Standard Life's products, growth, awards, and expansion efforts. It also provides background on the insurance industry in India, including key regulations and the growth of private insurers. HDFC Standard Life aims to increase its market share through new products, advertising, and improving its sales techniques.
This document provides an overview and executive summary of a project report on IDBI Federal Life Insurance Company. It includes sections on the organization overview, various departments like marketing, service, and HR. It discusses the company's history, mission, vision, competitors and products. Research methodology, objectives, and data collection sources are also mentioned. The document contains details of the project outline, chapters to be covered, and acknowledgements.
Project on CREDIT INSURANCE by Akshat MahendraAKSHAT MAHENDRA
Project Report on CREDIT INSURANCE
Project on CREDIT
BBI SEM 6 Project
Project Report on CREDIT
Semester VI BBI Blackbook Project 100 Marks
Project Report on INSURANCE
Semester 6 BBI Blackbook Project 100 Marks
Project on INSURANCE
Project on Finance
Project on Finance BBI
B.Com (BANKING and INSURANCE)
Project for BBI
Project on Finance BANKING INSURANCE
BANKING & INSURANCE
Semester 6 B.Com BANKING and INSURANCE Blackbook Project 100 Marks
BANKING and INSURANCE
Semester 6 BANKING and INSURANCE Blackbook Project 100 Marks
B.Com BANKING and INSURANCE
The document appears to be a research report submitted by Emmanuel Savio to his professor Renu Tiwari at St. Andrews College exploring life insurance products offered by the Life Insurance Corporation of India (LIC). It provides background on LIC and describes several of its popular life insurance plans, outlining their key features, benefits, eligibility requirements, and other details. The report was submitted to fulfill research objectives for Emmanuel's Bachelor of Commerce degree in the academic year 2011-2012.
project on ulip vs mutual funds.corporate bonds,debt fund,etcjyotish bharti
This document provides an overview of the insurance industry in India. It discusses the history and growth of the industry including the liberalization that allowed private players to enter in 2000. It introduces some of the major players in life and non-life insurance such as LIC, HDFC Life, ICICI Prudential and discusses factors that affect the industry like customers, competitors, technology. It also summarizes trends in the industry including rising demand for pension plans, bancassurance, and changing customer expectations around service and customization.
I express my sincere and deepest gratitude to mrAnuj Chauhan
The document is an internship report submitted to Mrs. Sunita Dwivedi for the Post Graduate Program in Marketing-Finance at ICICI Prudential Life Insurance Pvt. Ltd. It discusses the need for insurance and analyzes the life insurance industry and companies in India from 2000-2010. It provides profiles of the public sector Life Insurance Corporation of India and 22 private life insurers. Tables show the growth in offices of major private insurers from 2000-2010.
A project report on risk and return analysis of bharti axa productsKirankumar Kiri
The document provides an overview of risk and return concepts in finance and introduces the objectives, scope and methodology of a study on risk and return analysis of insurance products. It discusses that return is what an investor earns from an investment, while risk is the uncertainty associated with the investment. The potential return rises with increased risk. The study aims to maximize return by balancing risk, analyze risks of different insurance products, and do a comparative study of risk and return of insurance products. It will be limited to insurance products and use primary and secondary data collection.
This document provides an overview of the life insurance industry in India. It discusses the history and development of life insurance in India from its origins in 1818 to the present regulatory environment. Key events include the establishment of the Life Insurance Corporation of India in 1956, which had a monopoly for many years, and reforms in the 2000s that opened the industry to private companies and established the Insurance Regulatory and Development Authority (IRDA) to oversee the industry. The document also examines the contributions and growth potential of the life insurance sector for the Indian economy.
This document provides an overview of IDBI Federal Life Insurance, including:
1) IDBI Federal Life Insurance is a joint venture between IDBI Bank, Federal Bank, and Ageas insurance. It offers various insurance products to customers in India.
2) Information is provided on the partner organizations IDBI Bank, Federal Bank, and Ageas insurance.
3) An organizational structure of IDBI Federal Life Insurance is shown, including the CEO and heads of different divisions.
ING Vysya Life Insurance provides life insurance products and services in India. It has over 21,000 advisors working from 140 branches across 74 cities. The company aims to offer customers comprehensive protection, savings, investment, and retirement plans. It uses a tool called LifeMaker to help customers choose plans that suit their needs and life stage. Key partners include ING Group, Exide Industries, Gujarat Ambuja Cements, and Enam Group.
This document provides a summary of a research paper that compares the public and private life insurance companies in India. It begins with an abstract that outlines the objectives of comparing customer perceptions of service quality and analyzing the financial performance of public versus private insurers. The introduction provides background on the growth of the insurance sector in India. It then examines the performance of the public insurer LIC and private insurers based on financial ratios like liquidity, solvency, and leverage. The study found that LIC has stronger financial performance and stability compared to private insurers.
This document is a research report on customer preferences towards child education plans offered by Life Insurance Corporation of India (LIC). It includes an introduction discussing how customer perceptions can change over time. It then provides background on the benefits of life insurance and LIC's child education plans. The report contributes that LIC contributes 4% to India's gross domestic product and pays large dividends to the government. It concludes with an executive summary stating the report studies customer perceptions of insurance providers in Bhilai to help private and public insurers improve standards and customer facilities.
The document provides background information on the insurance industry in India. It discusses how the industry was nationalized in 1956 but opened up to private players in the 1990s. Currently there are 52 insurance companies operating in India, with the life insurance industry experiencing a decline in growth of 1.57% in 2011-12. The insurance sector has significant growth potential as penetration rates remain low compared to other Asian countries, providing opportunities for interested companies.
This document provides an overview of the insurance industry in India and IDBI Federal Life Insurance. It discusses the history of insurance in India dating back to ancient texts. Key developments include private players entering the market in 2000 which has led to growth. The future of the industry is promising with projections of the market reaching $63 billion by 2014 and insurance penetration increasing to 5-6% over the next 5 years. IDBI Federal Life Insurance aims to increase its brand awareness and market share through new products and improved services.
This document provides an overview of Reliance Life Insurance Company (RLIC) and the Indian life insurance industry. It discusses RLIC's profile, including its ownership structure and financial performance. It also provides background on the development of the Indian life insurance industry, from its origins in the 1800s to nationalization in 1956 and subsequent opening to private companies. The document outlines RLIC's vision, mission, goals and recent achievements. It concludes with a brief literature review on the concepts of insurance and the history and development of the insurance industry in India.
The insurance sector in India is governed by various acts and regulations. It has grown significantly in recent decades but penetration remains low, with over 80% of the population lacking life or health insurance. Reforms including allowing private companies and 26% foreign ownership have increased competition and improved products. The regulatory framework continues developing to promote growth while protecting policyholders.
11.service quality assessment in insurance sector a comparative study between...Alexander Decker
This document summarizes a research study that assessed service quality in the insurance sectors of India and China. The study developed a valid and reliable instrument to measure customer perceptions of service quality across six dimensions: assurance, personalized financial planning, competence, corporate image, tangibles, and technology. While both countries operate in similar service environments, the study found that customer responses to these service quality components differed between the two countries. The document provides background on the growth of the insurance industries in India and China and reviews literature on previous studies measuring service quality in various service sectors and countries.
The document provides an overview of the Indian insurance sector, including:
1) It discusses the history and types of insurance, including life and general insurance. General insurance is further broken down into fire, marine, and miscellaneous insurance.
2) It lists some of the major players in the life and general insurance industries in India.
3) It describes the regulatory body, the Insurance Regulatory and Development Authority (IRDA), and its objectives of promoting competition and protecting policyholders.
4) It discusses various political, economic, social, and technological factors that affect the insurance industry according to PEST analysis.
5) It provides some suggestions to help insurance companies in India reduce costs and
A study on the growth of indian insurance sectoriaemedu
The document summarizes the growth and development of the Indian insurance sector. It discusses key milestones like the nationalization of life insurance in 1956 and general insurance in 1972. It then covers the liberalization period starting in 1999 with the establishment of IRDA, which allowed private players to enter the market. Today there are 29 insurance companies with private players controlling around 26% of life and non-life markets. While competition has increased, the four public sector insurers still dominate with over 70% combined market share. The document also provides tables outlining the major players in life and general insurance.
Evolution of the healthcare industry in India and the potential impact of the...Harshit Jain
2014 looks to be a positive but challenging year for the Indian health care sector; one in which many historic business models and operating processes will no longer suffice amid rising demand, continued cost pressures, lack of or inadequate care facilities, and rapidly evolving market conditions. India, likely will be dominated by the “Modi-care” –Health assurance for all.
The document contains information about an individual including their name, job title, contact information, education history from 1998-2006, work experience from 2006-2011, and details about a fundraising campaign by CODOCA MTVCOLA MARKETING ADVERTISING AND OUTSOURCING PRIVATE LIMITED led by Vishvas Yadav to provide funds for social causes and NGOs. It also contains information about project management certification offered at INR 5500.
9 3 multiplying polynomials by monomials lessongwilson8786
This document discusses multiplying polynomials by monomials using algebra tiles. It provides examples of multiplying different polynomials by monomials, such as 3(x + 4) = 3x + 12, x(x + 3) = x^2 + 3x, and -3x(2x + 1) = -6x^2 - 3x. It also models other examples like 2(x + 5) = 2x + 10, 4(3x + 1) = 12x + 4, and -5(-x - 2) = 5x + 10 to demonstrate how to multiply polynomials by monomials.
The authors developed three online interactive workbooks using the Articulate platform for social care, early childhood care, and youth and community work students. Students provided real-time feedback on the workbooks through surveys after using each one. The feedback helped troubleshoot technical issues and influenced changes to the subsequent workbooks. Gathering and responding to student feedback required redefining team roles, with the instructional designer becoming more student-focused, the librarian taking on blended library and instructional design skills, and the lecturer receiving more support. This new collaborative model helped improve e-learning adoption across various disciplines.
The struggle to set aside savings and the increasing difficulty that many working people find in securing a decent income at retirement is one of the less noticed but potentially most far-reaching issues in the living standards debate.
In her first major speech on pensions policy since becoming Shadow Secretary of State for Work and Pensions, Rachel Reeves MP discussed Labour’s plans for helping those on modest and low incomes save for a pension and secure a decent income at retirement.
These are the slides presented by Michael Johnson, Research Fellow at the Centre for Policy Studies who responded to the speech by Rachel Reeves MP on 29th May 2014.
How To Engage Audiences With Snapchat GeofiltersAustin Dixon
This document provides tips on how to effectively use Snapchat geofilters to engage audiences. It recommends that marketers 1) Know their audience by understanding what types of content resonates with them and why, 2) Design geofilters with engagement in mind by making them appealing for users to use, and 3) Think carefully about location by targeting filters to places where the audience uses Snapchat most. The document also highlights benefits of geofilters like their ability to target specific locations, facilitate instant sharing, provide early adoption opportunities, offer high impression value, and gain unlimited impressions at no extra cost.
El documento proporciona 11 pasos básicos para instalar un sistema operativo como Windows o Linux en una PC. Estos incluyen realizar una copia de seguridad de los datos, limpiar el disco duro, iniciar desde un dispositivo de instalación, seguir las instrucciones durante la instalación, reiniciar la PC y permitir actualizaciones y la instalación de antivirus.
Oracle is a relational database management system where data is stored in tables and accessed using SQL. It has been in development since 1979 and has evolved to support new technologies. The Oracle database architecture uses a shared pool of memory to cache data and SQL for fast access. Data is organized into tablespaces which contain one or more datafiles to store table rows and other objects.
A bíblia das crianças - José encontra os irmãos (estória e atividades)Cheila Peças
José se casou e teve filhos no Egito. Quando uma fome atingiu Canaã, seus irmãos foram ao Egito comprar comida. José, que agora era poderoso, testou seus irmãos e revelou sua identidade. Todos se reconciliaram.
1. Silabus mata pelajaran fisika kelas X mencakup kompetensi inti dan kompetensi dasar tentang pengukuran, vektor, gerak lurus, dan hukum Newton.
2. Pembelajaran dilakukan dengan mengamati, menanya, mengeksplorasi, mengasosiasi, dan mengomunikasikan untuk memahami konsep-konsep fisika.
3. Penilaian meliputi tugas, observasi, portofolio, dan tes untuk menilai pemahaman sis
The document appears to be promotional materials for Vishvas Yadav's company CODOCA MTVCOLA MARKETING ADVERTISING AND OUTSOURCING PRIVATE LIMITED, which offers Project Management certification and conducts fundraising campaigns for NGOs, orphanages, and charitable trusts. It provides details on Vishvas Yadav's role as Program Director, the company's fundraising efforts, and contact information to learn more about Project Management certification or contributing to the fundraising campaigns.
The document provides an overview and analysis of the key features of the Union Budget for 2014-15 presented by the new Indian government. Some of the key initiatives outlined in the budget include achieving fiscal deficit targets, promoting growth in the agriculture sector through investment in research and infrastructure, boosting foreign direct investment by raising caps in sectors like defense and insurance, and prioritizing growth in infrastructure, manufacturing and services to accelerate economic growth and job creation. The budget aims to stabilize the economy and revive GDP growth to 7-8% through these economic and policy measures.
This document provides an overview of the life insurance industry in India. It discusses how the industry has grown significantly over the years and now represents a major economic sector. While insurance penetration is still low compared to other countries, there is huge growth potential as nearly 80% of the population lacks adequate life or health insurance. The regulatory framework for insurance is outlined, including the key acts governing the industry and the role of the Insurance Regulatory and Development Authority. Segment-wise splits of new business premiums collected in 2010 and 2011 are also presented in charts.
The present book is a great step in forward direction of Indian Insurance sector ; and I have no doubt that after studying this book in detail and getting through the examination successfully, the insurance agent will gain substantially in accomplishing the tasks that are assigned to him or her. I would keenly look forward to its huge success in the Indian insurance domain in the days to come.
This document provides an overview of the Indian insurance industry. It discusses that the insurance industry in India has a history dating back to 1818 and provides life and general insurance. It notes that the industry has gone through changes in recent years with the opening up of the private insurance sector. It then discusses the nature of the industry, including that it provides protection against financial losses. It also discusses industry organizations, products offered, and recent developments like increased online services. It provides information on working conditions and common occupations in the industry.
This document provides an overview of the Indian insurance industry. It discusses that the insurance industry in India has a history dating back to 1818 and provides life and general insurance. It notes that the industry has gone through changes in recent years with the opening up of the private insurance sector. It then discusses the nature of the industry, including that it provides protection against financial losses. It also discusses industry organizations, products offered, and recent developments like increased online services. It provides information on working conditions and common occupations in the industry.
This document provides a project report on the sales process of life insurance. It includes an acknowledgement, declaration, table of contents, and introduction discussing the history and major players of the Indian life insurance industry. The report was submitted by a group of students from the Indian Institute of Planning and Management in Hyderabad, India under the guidance of an instructor from Metlife India Insurance.
Comparative analysis of insurance market in india on hdfc-life-1-1Flex
This document is a project report submitted by Vivek Kumar to SavitriBai Phule Pune University for the degree of Master of Business Administration. The report is about life insurance and taxation in India, with a focus on HDFC Standard Life Insurance. It includes approval letters for the internship and project, a certificate confirming the original work, and declarations. It also provides acknowledgements, preface, index, and executive summary sections.
This document provides an overview of IDBI Federal Life Insurance Company, including its sponsors and joint venture partners. IDBI Federal is a joint venture between IDBI Bank, Federal Bank, and Ageas, a European insurance giant. IDBI Bank owns 48% equity, while Federal Bank and Ageas each own 26% equity. The company offers life insurance and retirement products through the branches of IDBI Bank and Federal Bank, as well as advisors and partners. As of January 2011, the company had over 2.68 lakh policies with Rs. 14,230 crores of sum assured. The sponsors, IDBI Bank and Federal Bank, are described as leading Indian banks.
CII-EY report titled Insurer of the Future reveals that technology will power the new wave of change for the Indian Insurance Industry. The report recommends pursuing technology to improve the traditional insurance process and to re-configure the insurance business model.
This document discusses the recruitment of advisors and sales of financial products through advisors in the life insurance industry in India. It provides background on the history and development of the life insurance sector in India. It describes how advisors, also known as agents, are critical to the distribution and sales process, as they are the primary channel through which insurance companies can explain policies and benefits to customers. The success of insurance companies depends on having an adequate network of agents to capture market share.
focusing on Aditya Birla capital Advertisement Strategies, tying to know consumer behaviour and Branding. Understand how companies find target group and also get to know consumer insight.
Done Research get to know consumer behaviour towards Insurance Sector and i.e. also develop questionnaire to know consumer behavior towards private and public Insurance Company.
This document discusses the impact of the global financial crisis on the Indian insurance industry. It provides background on the history and development of insurance in India. It then describes the current state of the Indian insurance market, which includes both public and private sector players. Finally, it discusses the global financial crisis that began in 2007-2008 and its effects on financial institutions worldwide. In 3 sentences:
The document provides context on the history and development of the Indian insurance industry. It then outlines the present scenario of the industry, which includes both public and private players competing in the large and growing Indian market. Finally, it introduces the global financial crisis that began in 2007 and may have impacted the Indian insurance sector.
The document discusses the insurance industry in India, including its structure, performance, and future challenges. Some key points:
- Private insurance companies have gained market share, acquiring 13% of the life insurance market and 14% of the non-life market within a short time, but there remains huge untapped demand for insurance products in India.
- Challenges for the insurance sector include demand conditions, competition, product innovations, distribution systems, technology use, and regulation.
- A colloquium was held to discuss issues like future demand for insurance, competitive pressures from bank participation, implications of declining average policy sizes, product innovations, benefits from global partnerships, and the role of technology.
-
A comparative study on ‘ulip’ polices offerd by icici and comparison to hdfc ...Projects Kart
This document provides an overview of HDFC Bank and ICICI Prudential Life Insurance Company. It discusses their product profiles, highlighting savings, protection, child, market-linked, and retirement solutions offered by both companies. It also briefly outlines their group insurance solutions, including plans for gratuity, superannuation, and term insurance. HDFC Bank is described as India's second largest bank, while ICICI Prudential is a joint venture between HDFC Bank and Prudential plc focused on providing leading-edge life insurance solutions in India.
The document provides an overview of the Indian insurance industry. It discusses the market size, key players, and LIC's dominance. It also covers entry barriers like foreign ownership restrictions, high capital requirements, and lack of composite licenses. Competition is increasing as private players challenge LIC's monopoly, though LIC and GIC still dominate market share. The future growth depends on improved customer-centric products and distribution channels to increase rural penetration.
October 2016 Edition of BEACON, A Monthly Newsletter by SIMCON.
Inside this issue:
About Us
Our Team
INDUSTRY ANALYSIS : Insurance
Brand Analysis: Bata
Case Study Analysis: Ola
Concept of the month: Bug Bounty
Guest Lecture by Devang Mehta
This document discusses the importance of intellectual capital and innovation in the agricultural insurance sector. It begins by outlining the importance of insurance services for agricultural producers and sectors. Intellectual capital is defined as the knowledge, skills, and experiences of employees, while innovation refers to new processes, services, marketing methods, and organizational changes. The relationship between intellectual capital and innovation is then explored, finding they have a reciprocal relationship that can boost company performance. Specifically within insurance companies, intellectual capital and innovation are crucial assets that allow companies to develop new services, gain competitive advantages, and better serve customer needs. Overall, the document argues that effectively managing intellectual capital and fostering innovation are important for the success and sustainability of agricultural insurance companies.
The document is a project report on the product/services and marketing strategies of Kotak Mahindra Life Insurance. It includes an introduction to the insurance industry in India, the importance and functions of life insurance. It also describes the research methodology used in the project which involved collecting primary data through surveys to analyze customer buying behavior and evaluate strategies for recruiting life insurance advisors.
Training needs identification in service industries shubhangini sahuSanjib Pal
This document provides details about a research report submitted for a Master of Business Administration degree. It includes an abstract that introduces the topic of correlating theoretical management studies with practical business experience through research projects. It also discusses how the fast pace of technological change is impacting businesses and individuals. The document then outlines the importance of the insurance sector to the economy. It provides a table of contents and acknowledges those who helped with the research. It also includes sections on the company profile, research objectives, methodology, data analysis, limitations and conclusions. Overall, the document presents a research report on identifying training needs in the service industry.
Similar to Indian Insurance Sector: ‘Building Growth, Building Value’ (20)
The May edition of the Multilateral Newsletter highlights the key deliberations from the Forum and provides the key recommendations made by the OECD stakeholders. In addition, the edition covers major happenings at the World Bank, Asian Development Bank (ADB), B20 and International Labour Organisation (ILO).
The document discusses empowering micro, small and medium enterprises (MSMEs) in India. It outlines some key policies and initiatives that have impacted MSMEs recently, both positively and negatively. These include banning letter of undertakings to check banking irregularities, addressing issues from demonetization, and the impacts of implementing the Goods and Services Tax (GST). Overall, the MSME sector contributes significantly to the Indian economy but still faces challenges around access to finance, regulations and compliance that need to be addressed for it to reach its full potential.
It’s a matter of concern that 600 million people in India face high to extreme water stress in the country. About three-fourths of the households in the country do not have drinking water at their premise. With nearly 70% of water being contaminated, India is placed at 120th amongst 122 countries in the water quality index. It’s a fact that water is a State subject and its optimal utilization and management lies predominantly within the domain of the States. This index is an attempt to budge States and UTs towards
efficient and optimal utilization of water and recycling thereof with a sense of urgency.
GST has been implemented in India for one year. A survey found that most respondents believe GST was the right decision and are satisfied with its overall implementation. Specifically:
- 83% believe GST was the right step. Nearly two-thirds are satisfied with the overall implementation.
- GST has had a positive impact on employment and demand for goods and services.
- Respondents were satisfied with many aspects of GST like registration, invoices, record keeping. However, some were less satisfied with penalties, interest rates and certain refund processes.
Cyberspace is rapidly transforming our lives – how we live, interact, govern and create value. With the JAM (Jan Dhan, Aadhaar and Mobile) trinity, India is at the forefront of global digital transformation. “Digital India” is being hailed as the world's largest technology led programme of its kind.
While internet, smartphones and modern information and
communication devices have been great force multipliers, endless connectivity and proliferation of IoT devices is giving rise to vulnerabilities, risks and concerns. Cyber security is today ranked among top threats by governments and corporates. Heightened concerns about data security and privacy have resulted in a spate of regulations in India and across the world. India is in the process of discussing and enacting its own comprehensive data security and privacy regulation, as well as vertical specific ones. Cyber security is an ecosystem where laws, organisations, skills, cooperation and
technical implementation would need to be in harmony to be
effective.
Overall, a robust regulatory framework based on global and
country-specific regulations, development of a holistic cyber
security eco-system (academia and industry as well as
entrepreneurial) and a coordinated global approach through
proactive cyber diplomacy would help to secure cyber space and promote confidence and trust of key stakeholders including
citizens, businesses, political and security leaders.
CII has been actively working in the cyber security space. The CII Task Force on Public Private Partnership for Security of the Cyber Space has been set up to bring about improvements in the legal framework to strengthen and maintain a safe cyberspace ecosystem by capacity building through education and training programmes. We would facilitate collaboration and cooperation between Government and Industry in the area of cyber security in general and protection of critical information infrastructure in particular, covering cyber threats, vulnerabilities, breaches, potential protective measures, and adoption of best practices.
Delhi, the capital of India, has emerged as a major commercial capital and industrial hub of India. It is home to a wide range of industries including textiles, electrical and electronics, IT &ITeS services, hotel and tourism, which have contributed immensely to the economic and industrial growth of the country. Nearly 88% of the SMEs in Delhi revealed that this cluster is as an attractive destination for conducting business. Delhi has become an attractive business and tourist destination. This is driven by its improved infrastructure, good connectivity with other Asian and western regions, ease of access to market and availability of skilled labor among others. Consequently, it has emerged as
one of the most preferred investment and business destinations.
The state government of Maharashtra has been at the forefront in creating a conducive business environment that fosters globally competitive firms. Business reforms introduced both by the Central as well as the state government have played a critical role in India’s 30 spots improvement in the Doing Business ranking for 2018.
The State, under the Business Reforms Action Plan (BRAP) 2016, has implemented over 90 per cent reforms in 7 out of 10 parameters, including labour registration, utility connections, single window system, environment registration, among others. These policy reforms have significantly helped in the reduction in time and cost of doing business for the industry, thereby
establishing Maharashtra as one of the top investment destinations in the country.
This report provides the key highlights of the select initiatives on ease of doing reforms in Maharashtra. With a view to provide on-ground impact of these initiatives, the Report also captures industry views on various aspects of business reforms.
The March-April edition of the Multilateral Newsletter gives insights on the key happenings at the various multilateral institutions and highlights the key discussions and deliberations at the informal WTO Ministerial Meeting held in New Delhi.
WTO plays a vital role by bringing stability and predictability to the multilateral trading system. It is a collective responsibility of WTO members to address the challenges faced by the system and putting the economies back on steady and meaningful way forward.
Several proposals and initiatives on investment facilitation were tabled at the WTO in the run-up to the 11th Ministerial Conference. The proponents advocated discussions on Investment Facilitation within the WTO framework. However, there was no consensus on initiating negotiations, or even establishing a Work Programme, on Investment Facilitation. A clear need of more work to look at all aspects of a potential multilateral rules on Investment, particularly on its impact on domestic policy space was stated.
In order to deepen the understanding between the member it is important that an open, transparent and inclusive approach of decision making for the various interventions. The informal WTO Ministerial gathering in New Delhi saw convergence of around 53 members representing a broad spectrum of the WTO membership.
CII, as an Industry Institution is cognizant of the need for India to engage constructively in some of the new issues being discussed under the WTO framework.
Businesses are gradually recognizing that ethics means good business. It is believed that well-run and trustworthy
companies are more likely to attract greater investment opportunities, which enables them to innovate and expand, and
generate wealth and jobs. Good corporate governance practices are regarded as providing an 'extra' edge to companies
to enhance their image and stay ahead in an intensely competitive business environment. This would help them imbibe
universally accepted values of ethics and good governance—accountability, transparency, responsibility and
responsiveness to stake holders. Besides, it would also mean looking beyond achieving mere economic sustainability to
include social and environmental sustainability as well. Many corporates are adhering to sustainable business practices
and many more are likely to follow suit in the time to come.
On the domestic front, CII expects economic growth to bounce back to 7.3-7.7 per cent in FY19 from the estimated 6.6
per cent in FY18. The prognosis of improved rural consumption and a recovery in private investment will support
growth, even as the debilitating effects of demonetisation and GSTimplementation will fade away
The Commuique May 2018 edition discusses the cover story
on 'Resolving Insolvency in India'
The Insolvency and Bankruptcy Code (IBC) 2016, is one of
the biggest regulatory reforms corporate India has witnessed
in recent times.
It also features 'UK-India CEO Forum Meeting ', 'CII CEOs Delegation to 11th Commonwealth Business Forum 2018', 'Four Transformations of the Global Energy Market', Economy pieces on 'The Innovation Paradox' & 'Can the Lion Conquer the Forest?' along with a piece on 'India-Africa Economic Partnership'.
The government of India has, in the past few years, accorded an utmost priority to the Ease of Doing Business (EoDB). The accent is on simplification of regulations and use of technology to make the compliance more efficient for businesses. Apart from the Centre, the States are also being encouraged to implement business reforms in the spirit of competitive federalism, to foster reforms at the sub-national level. The measures are aimed at creating a conducive business environment, which is a key to facilitating growth and creating jobs. Thanks to these measures, India’s EoDB ranking, captured by the World Bank, has improved by 42 spots since 2014 to touch the 100th position now. The Prime Minister envisions India among the top 50 nations in the next couple of years.
While business reforms are being undertaken at a rapid pace and large scale, cutting across Central as well as state levels, it is imperative that awareness about these developments is created among stakeholders and regular feedback is generated to address the gaps in the implementation of reforms. Identification of pending issues and suggesting possible solutions are equally vital. It is also important to identify the best practices within and outside the country, which are considered for implementation by the needy states.
The report reflects on the role of broadband connectivity and the multiplier effect it has on the larger ecosystem. India is ripe for a Digital rethink, with both government and industry aligning their efforts toward a broadband powered Digital India. Broadband has the power to enable the gigabit society that is always connected. Broadband connectivity has changed the way people
communicate, socialise, create, sell, shop and work. India’s digital consumption patterns highlights the evolution. On an average Indians spend 200 minutes on mobile every day, with the second highest app downloads globally. Almost 79% of the web traffic in India is on mobile.
To realise the Digital India dream, there is a need to strengthen the broadband backbone, which forms a key pillar of this transformation. This report highlights the need for future ready and robust broadband infrastructure and the requisite efforts for expediting its reach.
South Africa and India share a rich past and bright future. India has transitioned from being South Africa’s political ally to being a vibrant economic partner. Despite challenges, the opportunity for increasing the value of bilateral trade between the two countries is growing exponentially each year.
South Africa and India have nurtured a bilateral relationship since the 1860s, when the first Indians arrived in South Africa. India was one of the first countries that rallied at the United Nations in support of the anti apartheid movement in South Africa. The strong bond established between the two countries during the struggle for democracy in South Africa became further entrenched in post-apartheid South Africa.
Most global businesses recognise South Africa as the most favourable destination in Africa for making long-term investments. The country offers a stable political and economic environment with established institutions. Policies and procedures are well articulated and consistent, and it offers a free and competitive environment with open-minded consumers. South Africa provides the most stable and technologically viable environment for Indian companies wishing to establish a base from which to expand across the continent. As a gateway to Africa, it is renowned for its infrastructure, skills pool and expertise.
The document discusses India's progress and potential in innovation and adoption of new technologies. It makes the following key points:
1) While India has the human capital and resources to leverage new technologies like AI, machine learning, and IoT, its spending on R&D as a percentage of GDP is still low compared to other countries. The industry sector in particular needs to increase its investment in technology and innovation.
2) CII has been promoting technology adoption in Indian industry through various programs and platforms. It is also partnering with the government on initiatives to facilitate industry-academia collaboration and international joint R&D projects.
3) For India to fully capitalize on new technologies, both industry and start
This is the fifth edition of the Grant Thornton India meets Britain Tracker, developed in collaboration with the Confederation of Indian Industry. The India Tracker identifies the fastest-growing Indian companies in the UK, as well as the top Indian employers. It provides insight into the evolving scale, business activities, locations and performance of the Indian-owned companies who are making the biggest impact in the UK.
This year, our research identified approximately 800 Indian companies operating in the UK, with combined revenues of £46.4 billion (£47.5 billion in 2017). Together, they paid £360 million in corporation tax (£275.7 million in 2017) and employed 104,932 people (105,268 in 2017). This shows the continued importance of the contribution that Indian companies make to the UK economy.
The Make in India initiative of the government which lays emphasis on domestic manufacturing, indigenization and import substitution, is expected to pave the way for making the Indian defence sector self-sufficient.Encouragingly, the Indian industry is now actively engagedand is partnering with the government in building a modern and best-in-class defence systems, equipment and components which should strengthen our forces and make the country more self-reliant. The formation of the Society of Indian Defence Manufacturers (SIDM) as an apex body of the Indian defence industry is critical in this regard. SIDM is expected to play a proactive role as an advocate, catalyst and facilitator for building the growth and capability of the defence industry in India. Given the rising importance of buttressing the Make in India programme for expanding the capacity of the Indian defence sector, in this issue of Economy Matters, a few SIDM office bearers and defence experts present their insights into this crucial topic.
As India integrates deeper into the global economy, it is becoming increasingly clear that the country needs to focus both on meeting international competition and its own developmental challenges.
The Government launched several initiatives last year, such as Make in India, Skill India, and Digital India, among others, towards make the vision of integrated inclusive development a reality.
For industry, grappling with the challenges of disruptive technologies, restrictive trade laws, environmental responsibilities and more demanding and discerning customers, the imperative is for sharper focus on producing excellent goods and services, along with building skills, generating jobs, and mainstreaming the marginalized.
The document recommends actions to reform public transport and shared mobility in Delhi to reduce air pollution. It finds that private vehicles have significantly increased while public transport options like buses have declined. It recommends identifying gaps in public transport accessibility, increasing bus fleets by involving private players through liberalized permit systems, leveraging existing cluster bus models, and liberalizing taxi permits for aggregators. Coordinated action is needed between central and state governments to ensure bus aggregators and state transport undertakings coexist synergistically. Expanding public transport options can help shift travelers from private vehicles to more sustainable modes.
Confederation of Indian Industry (CII) takes immense pleasure in presenting the third edition of Annual CSR Tracker 2017. Similar to the last two editions, this is the most comprehensive analysis of CSR disclosures of Bombay Stock Exchange (BSE-listed) companies obligated to practice CSR as per the Companies Act, 2013.
The Annual CSR Tracker 2017 is based on disclosures of 1,522 companies as compared to 1,270 companies in 2016 and 1,181 in 2015. Disclosures are broken into approximately, 41 indicators spread across six aspects of CSR legislation: governance, policy, financials, spends as per Schedule VII, spend channels, and spend locations. Also included is beneficiary data that companies voluntarily disclose in their annual reports.
At CII Indian Women Network, we are driven by the imperative that Indian women become a core critical mass of the workforce to bring about the transformational change in attitude and behavior. We have also recognized the importance of some amazing women role models who can inspire the future generation into believing that there are no limits to what a woman can achieve. One critical aspect is our own self-belief and innermost conviction that will ultimately help us triumph in our relentless struggle for gender equality. It is a pleasure to share this comprehensive report with you that captures the universe of several variables that will impact our future progress.
IMPACT Silver is a pure silver zinc producer with over $260 million in revenue since 2008 and a large 100% owned 210km Mexico land package - 2024 catalysts includes new 14% grade zinc Plomosas mine and 20,000m of fully funded exploration drilling.
At Techbox Square, in Singapore, we're not just creative web designers and developers, we're the driving force behind your brand identity. Contact us today.
Event Report - SAP Sapphire 2024 Orlando - lots of innovation and old challengesHolger Mueller
Holger Mueller of Constellation Research shares his key takeaways from SAP's Sapphire confernece, held in Orlando, June 3rd till 5th 2024, in the Orange Convention Center.
B2B payments are rapidly changing. Find out the 5 key questions you need to be asking yourself to be sure you are mastering B2B payments today. Learn more at www.BlueSnap.com.
3 Simple Steps To Buy Verified Payoneer Account In 2024SEOSMMEARTH
Buy Verified Payoneer Account: Quick and Secure Way to Receive Payments
Buy Verified Payoneer Account With 100% secure documents, [ USA, UK, CA ]. Are you looking for a reliable and safe way to receive payments online? Then you need buy verified Payoneer account ! Payoneer is a global payment platform that allows businesses and individuals to send and receive money in over 200 countries.
If You Want To More Information just Contact Now:
Skype: SEOSMMEARTH
Telegram: @seosmmearth
Gmail: seosmmearth@gmail.com
Building Your Employer Brand with Social MediaLuanWise
Presented at The Global HR Summit, 6th June 2024
In this keynote, Luan Wise will provide invaluable insights to elevate your employer brand on social media platforms including LinkedIn, Facebook, Instagram, X (formerly Twitter) and TikTok. You'll learn how compelling content can authentically showcase your company culture, values, and employee experiences to support your talent acquisition and retention objectives. Additionally, you'll understand the power of employee advocacy to amplify reach and engagement – helping to position your organization as an employer of choice in today's competitive talent landscape.
LA HUG - Video Testimonials with Chynna Morgan - June 2024Lital Barkan
Have you ever heard that user-generated content or video testimonials can take your brand to the next level? We will explore how you can effectively use video testimonials to leverage and boost your sales, content strategy, and increase your CRM data.🤯
We will dig deeper into:
1. How to capture video testimonials that convert from your audience 🎥
2. How to leverage your testimonials to boost your sales 💲
3. How you can capture more CRM data to understand your audience better through video testimonials. 📊
How MJ Global Leads the Packaging Industry.pdfMJ Global
MJ Global's success in staying ahead of the curve in the packaging industry is a testament to its dedication to innovation, sustainability, and customer-centricity. By embracing technological advancements, leading in eco-friendly solutions, collaborating with industry leaders, and adapting to evolving consumer preferences, MJ Global continues to set new standards in the packaging sector.
The 10 Most Influential Leaders Guiding Corporate Evolution, 2024.pdfthesiliconleaders
In the recent edition, The 10 Most Influential Leaders Guiding Corporate Evolution, 2024, The Silicon Leaders magazine gladly features Dejan Štancer, President of the Global Chamber of Business Leaders (GCBL), along with other leaders.
Taurus Zodiac Sign: Unveiling the Traits, Dates, and Horoscope Insights of th...my Pandit
Dive into the steadfast world of the Taurus Zodiac Sign. Discover the grounded, stable, and logical nature of Taurus individuals, and explore their key personality traits, important dates, and horoscope insights. Learn how the determination and patience of the Taurus sign make them the rock-steady achievers and anchors of the zodiac.
At Techbox Square, in Singapore, we're not just creative web designers and developers, we're the driving force behind your brand identity. Contact us today.
Zodiac Signs and Food Preferences_ What Your Sign Says About Your Tastemy Pandit
Know what your zodiac sign says about your taste in food! Explore how the 12 zodiac signs influence your culinary preferences with insights from MyPandit. Dive into astrology and flavors!
Implicitly or explicitly all competing businesses employ a strategy to select a mix
of marketing resources. Formulating such competitive strategies fundamentally
involves recognizing relationships between elements of the marketing mix (e.g.,
price and product quality), as well as assessing competitive and market conditions
(i.e., industry structure in the language of economics).
2. 2 | Indian insurance sector: Building Growth, Building Value
The insurance sector in India is overlooking an exciting period in its evolution. With
the passage of the Insurance Laws (Amendment) Act 20151
, the longtime demand
of having greater access to foreign capital has been fulfilled. This one amendment
can be a game changer as it will bring in significant fresh capital to re-energize the
sector. However, insurance companies must tread with caution and carefully adopt
changes to make the best possible use of the opportunities presented. The sector
will have to partner with the regulator and other industry bodies to ensure that the
current phase leads to a holistic long-term growth and successfully builds value for
all the stakeholders involved.
The major gaps which the industry must plug in are around realizing a cost-effective
distribution mix (primarily life), checking the ongoing slowdown in the non-life
sector, getting a handle on claims (particularly in motor and health lines) and
absence of a sizable presence in the pension space. To prepare for the next level
of progression, the industry must have a strong focus on augmenting the value
insurance brings to nation’s economy, the society, its customers, the distributors,
the shareholders and the insurance companies themselves.
The Confederation of Indian Industry (CII) and EY bring you this report on the
Indian insurance industry where the key aspects on the evolution of the sector,
the prevalent trends/challenges and the imperatives for the industry have been
discussed. To bring in an external perspective, a separate section highlighting the
issues faced in global markets is covered which identifies themes which may play
a role in the Indian context in times to come. Finally we provide our view on the
imperatives toward which the industry must work for a rewarding and engaging
journey ahead.
Foreword
Chandrajit Banerjee
Director General
Confederation of Indian Industry
Rohan Sachdeva
Global Insurance Emerging Markets Leader
Partner & Leader –
Financial Services Advisory Services
Ernst & Young LLP
1. Press Information Bureau, Government of India, Ministry of Finance, 13 March 2015
3. 3Indian insurance sector: Building Growth, Building Value |
Contents
1. Executive summary................................................................................... 4
2. Overview: Driving economic growth while creating stakeholder value........... 6
a. Insurance industry - stakeholder value creation at its core.................... 7
b. Insurance industry’s role as a key enabler for economic growth............ 8
c. The growth story – Liberalization, expansion and introspection............. 9
3. Global insurance market trends................................................................ 14
4. Trends and Issues – Indian Market............................................................. 22
a. An elusive pursuit of a ‘cost-effective’ distribution channel
(life insurance)................................................................................. 23
b. Non-life: slowdown in volume growth after a strong run..................... 25
c. Despite recent improvements, claim ratios remain adverse
(non-life)......................................................................................... 26
d. Insurance regulations – from oversight to cautious optimism.............. 39
e. Pensions and retirement solutions – a major gap in life insurers’
product portfolio............................................................................. 31
5. Way forward and imperatives for Indian insurers........................................ 34
a. Pursuing efficiency in distribution..................................................... 35
b. Making the most of the Insurance Laws (Amendment)
Act 2015 ........................................................................................ 36
c. Awaiting a paradigm shift: exploring possibilities in the
pension space.................................................................................. 37
d. Further penetrating the health insurance market............................... 39
e. Solving the cost conundrum by a greater use of technology................ 41
f. Embracing ‘Digital’ – disrupting the traditional business structures...... 43
6. Conclusion.............................................................................................. 48
4. 4 | Indian insurance sector: Building Growth, Building Value
1Executive summary
5. 5Indian insurance sector: Building Growth, Building Value |
From its fundamental role of providing basic protection against losses, the insurance industry in India has come
a long way over the last decade and a half. It has become an indispensable pillar to support India’s ascent to
economic prosperity and growth by accounting for risks, providing funds for nation building projects, steadying
equity markets and driving social security. In the process, it continues to create significant value for all its
stakeholders i.e. customers, distributors, shareholders and the insurance companies.
Indian insurance industry’s growth story since liberalization has been dramatic. Both life and non-life sectors
initially witnessed a long phase of sustained high volume growth. However, the life insurance sector’s charge
was halted by a much needed course correction initiated by the regulator in recent years, leading to a
stagnation in growth and a question mark on the viability of the existing business models. Non-life insurance,
on the other hand had a more consistent volume growth, but had its journey blemished by excessive claim
related losses. In both these cases, much of the pain was unleashed by necessary, yet too frequent regulatory
interventions, which prevented the industry from settling down.
Much like the Indian market, the global insurance scenario remains somber with persistent low interest
rates (impacting margins), soft pricing conditions in the non-life sector and frequent regulatory reforms.
Nevertheless, one major fact which differentiates the developed markets with the Indian market is India’s
unbeatable growth potential which in turn is derived from India’s low insurance penetration (overall 3.3% -
life 2.6%, non-life 0.7%), rising income levels, a high rate of economic growth and highly favorable
demographic attributes.
For ensuring a future which is characterized by a well rounded industry growth and which maximizes value
creation for all the stakeholders, the sector must work towards capitalizing on every opportunity. Some of the
areas which it must pursue in this regard include:
• Chasing efficiency in distribution by finding synergy among channels, driving skill development at an
industry level, optimizing the distribution network and achieving greater service integration between the
insurer and the distributor
• Making the most of the Insurance Laws (Amendment) Act 2015 by effectively utilizing the incremental
capital infusion to drive awareness, reaching out to underpenetrated segments and adopting global best
practices in operational efficiency and service delivery
• Exploring possibilities in the pension space by developing relevant products and incentivizing stakeholders
• Furthermore penetrating the health insurance segment by engaging customers early, creating cost
effective offerings (products with savings component, old-age health insurance) and by keeping a tab
on frauds
• Solving the cost conundrum by a greater use of technology to streamline operations, to curb losses from
claims and to prevent frauds
• Embracing digital whole heartedly to disrupt the traditional business structures while keeping risks in check
by leveraging a resilient cyber security framework
6. 6 | Indian insurance sector: Building Growth, Building Value
2
Overview: Driving
economic growth
while creating
stakeholder value
7. 7Indian insurance sector: Building Growth, Building Value |
a. Insurance industry - stakeholder value creation at its core
Insurance is an industry which has value creation at its core. It generates value for policyholders who lay their
trust in an insurance product, for shareholders who back the business, for distributors who depend on it for
their income and the insurance company itself which interlinks all the other stakeholders. It is this interlinking,
which if done in a balanced manner while keeping the costs low, creates a long-term success story.
Customer/policyholder,
the prime stakeholder
Value creation
Shareholder, the sponsor
Distributor, the facilitator Insurance company, the producer
Exhibit 2.1: Stakeholder value creation
Source: EY Knowledge Analysis
Value creation for stakeholders takes the form of
• For a customer/policyholder: Selling need based insurance plans; fair payouts during claim, maturity
or surrender
• For a distributor: Reasonable compensation for the time and effort involved in customer acquisition
• For a shareholder: Fair return on its investments over the long-term
8. 8 | Indian insurance sector: Building Growth, Building Value
• For the insurer: Creating a resilient business with a strong work culture, winning customers of its choice,
attracting the right investors who believe in the long-term and drawing the best manpower who drive the
business in an ethical manner
While the insurance industry in India has strived to maximize value for all, the emphasis on achieving a
balance has been actively driven in the recent years by persistent regulatory interventions. How the insurance
industry in India maps its progression in the future will be ascertained by the effectiveness with which all the
stakeholders collaborate and create enabling conditions. An ideal state will be an industry which is extremely
efficient in managing costs, generates high returns for shareholders, actively engages all the distributors with
confidence and most importantly attracts high customer loyalty.
b. Insurance industry’s role as a key enabler for economic
growth
The development of any modern age economy cannot be realized, if its insurance sector remains
underdeveloped. The insurance industry plays a crucial role in mitigating risks, supporting critical social levers,
providing long-term capital for infrastructure development, and rendering poise to equity markets.
Risk management
Insurance supports institutions in keeping a tab on unforeseeable losses, which can otherwise jeopardize the
institution’s existence. Insurance brings consistency to earnings by capping damages. It instils confidence
among investors to take business risks in areas where they would not participate normally.
Infrastructure development
With limited instruments available in the Indian market to support long-term asset liability management,
the insurance sector has successfully channelized savings toward nation building through infrastructure
development. The fact that the size of life insurers’ infrastructure investments has been growing at a rate
(FY08–15 CAGR: 18%) faster than India’s GDP growth exemplifies the criticality of this sector. Nearly
one-eighth (FY15: 12.4%)2
of the life insurers’ assets under management are currently being leveraged by
infrastructure projects.
2. Life Insurance Council data
Exhibit 2.2: Infrastructure investments by life insurers (in INR billion)
913
1,137
1,397
1,538
2,209
2,462
2,603
2,913
-
500
1,000
1,500
2,000
2,500
3,000
3,500
Source: Life Insurance Council
FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15
+18%
9. 9Indian insurance sector: Building Growth, Building Value |
Supporting equity markets
Insurers, being among the largest fund managers in India, are instrumental in checking adverse swings in equity
markets, as they tend to transact in relatively large volumes during market corrections.
Generating employment
The insurance sector is a major employment provider in India, as it has around 350,000 individuals on its
payroll (life and general), and indirectly employs at least 2 million more individuals (count of life insurance
agents alone exceeds 2 million, while thousands more are employed at channel partners and in other
associated sectors).
Social security and financial inclusion
Insurance allows sections of the society with low income to address risks that directly impact their livelihood.
Most insurance policies in this segment are being offered in conjunction with the Government, or through
policies sold under “rural or social sector obligations.”
Since liberalization in 2000, India’s insurance industry has grown in significance with each passing year and
has now turned into a major enabler of economic growth. However, its increased significance also implies that
the sluggish industry growth, seen in recent years, may become a drag on India’s economic growth in times to
come. Hence, to reenergize this growth engine, it will be critical that corrective measures are taken at multiple
levels through reinforcing regulatory interventions, collective efforts by the industry and corrective actions by
each insurer.
c. The growth story – Liberalization, expansion and
introspection
While the insurance sector’s journey over the last 15 years has been fast-paced, it hasn’t been flawless. Post
the opening of the sector for private participation and foreign funding in 2000, insurers went on an overdrive
to ramp-up distribution and operations in a bid to win market share. Rapid economic growth, rising middle class
population, and wealth and bullish equity markets enabled a 23% average rate of growth for the life insurance
industry’s first year premium between FY02 and FY11, and 16% for the non-life sector’s gross direct premium
between FY02 and FY153
.
However, as the building scale took precedence over creating a quality business, the regulator stepped in to
establish checks at every strata of the business. This led insurers to reflect upon the viability of their operating
models in the new product landscape. Insurers were compelled to undertake multiple corrective measures, as
efficiency and profitability became paramount for long-term value creation. As a result of these measures, the
customer took its rightful place as the central figure and the focus moved towards winning customer trust.
Life insurance industry
Growth over the years
The first year premium for life insurers grew from INR262 billion in FY05 to INR1,264 billion in FY11, at a
CAGR of 30% on account of growing awareness about life insurance, favorable demographics, buoyant
equity markets, rapid distribution expansion (particularly in the individual agency channel), and launch of
innovative products.
3. IRDAI Handbook 2013-14 data
10. 10 | Indian insurance sector: Building Growth, Building Value
However, the implementation of the revised ULIP guidelines in 2010 (which restricted margins and distributor
pay-outs significantly), multiple restrictions on corporate agents and brokers, coupled with persistent high-
inflation and low-growth scenario, resulted in stagnation in the new business premiums since FY11. As a result,
new business premium collections dropped from INR1,264 bn to INR 1,131 bn in FY15 (4 year CAGR: -3%).
However, in the near term, the life insurance sector is expected to grow by around 6% (till 2018)4
.
Exhibit 2.3: Evolution of India's life insurance industry
199 169 198 262
388
756
937 873
1,099
1,264
1,140 1,074
1,202
1,131
2.2%
2.6%
2.3%
2.5% 2.5%
4.1% 4.0% 4.0%
4.6%
4.4%
3.4%
3.2% 3.1%
2.6%
0%
1%
2%
3%
4%
5%
-
500
1,000
1,500
2,000
2,500
3,000
FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15
FYP (in INR bn) Penetration (gross premium/GDP)
1% 6% 12% 21% 26% 26%
36% 39% 35% 31% 28% 29% 25%
31%
Share of private players
Source: Life Insurance Council, IRDAI, Swiss Re ‘World Insurance’ reports
Competitive landscape
During the high growth phase in FY05-11, the share of private players (current count: 23) rose to 39%5
of the
first year premium in FY09, while that of the public sector behemoth Life Insurance Corporation of India (LIC)
dropped to 61%. With unit-linked products (ULIPs) losing favor among both distributors and customers post
FY11, and private players forced to reorganize their operations to better manage costs, the private players’
market share shrunk to 25% in FY14, with LIC regaining some of its lost turf. However, FY15 witnessed a strong
performance by bancassurance-dominated insurers, owing to the increased take-up of insurance in a rapidly
expanding private bank branch network (the top 3 private banks increased their combined branch count from
around 4,700 in March 2010 to 10,653 in March 2015), revival of ULIPs following a rebound in equity markets,
and greater use of technology. This, coupled with a relatively weak performance by LIC in recent quarters,
again led to a drop in LIC’s market share in FY15 (69% vs. 75% in FY14). The top four private players are all
bancassurance-led and now command 54% of the private market share and 17% of the total market share.
4. Source: Timetric – Insurance Intelligence Center data
5. IRDAI data
11. 11Indian insurance sector: Building Growth, Building Value |
Penetration and global position
A strong growth run during FY05-11 had taken India’s life insurance penetration (FY10: 4.6%)6
beyond the
global average (FY10: 4%). However, stagnation in life premium collections since FY11 against a high nominal
rate (real + inflation) of GDP growth led to a drop in the penetration level from 4.6% in FY10 to 2.6% in FY15
(FY15 global average: 3.4%), a level not seen since FY06. Similarly, India’s life insurance density (premium per
capita in US$), which continues to be much lower than the global average (FY15: US$368), fell from a high of
US$56 in FY11 to US$44 in FY15. Despite the low rate of adoption, India’s life insurance market is the 11th
largest in terms of gross written premiums.
Non-life insurance industry
Growth over the years
Non-life insurance sector’s volume growth has been more consistent, when compared to life insurance sector’s
growth. The gross direct premium of the non-life insurance sector stood at INR847 billion in FY15, having
grown at a CAGR of 16% since FY02. The non-life sector’s growth has been largely in line with the nominal rate
of GDP growth during this period. The lines of business leading this growth have been motor (CAGR of 18%
between FY06 and FY14) and health (CAGR of 30% between FY06 and FY14).
However, steady volume growth didn’t materialize into comparable value creation, particularly since 2007,
when price deregulation came into effect. Before 2007, insurers could drive profitable growth by altering
distributor payouts. Starting 2007, non-life insurers were pulled out of their comfort zone, as profits eroded
across lines of business, owing to increased price-led competition. Volume growth too, has come under
pressure over the last two years, on account of weaker auto sales and slow execution of infrastructure projects
among other factors. (FY15 growth: 9.3%). Despite the recent slowdown, the non-life sector is projected to
grow at a CAGR of 14% over the next three years (till 2018)7
.
6. Source for all penetration and density related information: Swiss Re ‘World Insurance’ reports
7. Source: Timetric – Insurance Intelligence Center data
Source: Life Insurance Council, IRDAI, Swiss Re ‘World Insurance’ reports
127 152 174 195 225 271 305 336
392
482
598
712
775
847
0.56%
0.67%
0.62% 0.64%
0.61% 0.60% 0.60% 0.60% 0.60%
0.70% 0.70%
0.78% 0.80%
0.70%
0.0%
0.1%
0.2%
0.3%
0.4%
0.5%
0.6%
0.7%
0.8%
0.9%
(100)
100
300
500
700
900
1,100
1,300
1,500
FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15
Gross direct premium (in INR billion) Penetration (gross premium/GDP)
Exhibit 2.4: Evolution of India's non-life insurance industry
Share of private players
4% 9% 13% 18% 24% 32% 37% 38% 38% 39% 40% 42% 44% 45%
12. 12 | Indian insurance sector: Building Growth, Building Value
Competitive landscape
Currently, the non-life insurance sector has a total of 28 insurance companies, with six being public and the
remaining being private. Of the 22 private players, five are stand-alone health insurers, which are rapidly
gaining volume, having grown at a CAGR of 22% since FY10 (FY15 growth: 31%). Despite having lost
considerable market share over the years, the top four public sector players (the remaining two public sector
players being specialized insurers) continue to dominate the non-life space with a market share of 50% in FY15
(FY06: 71%).
Penetration and global position8
Non-life insurance premium, as a percentage of GDP, has increased from 0.56% in FY01 to 0.70% in FY15,
and the per capita premium income increased from US$2.4 in FY01 to US$11 in FY15. However, both these
indicators continue to be much below the world average of 2.70% and US$294, respectively, indicating a very
high long-term growth potential. Despite extremely low penetration and density, the Indian market ranks 20th
in terms of the size of premiums underwritten.
8. Source for all penetration and density related information: Swiss Re ‘World Insurance’ reports
14. 14 | Indian insurance sector: Building Growth, Building Value
3Global insurance
market trends
15. 15Indian insurance sector: Building Growth, Building Value |
Quest for growth amidst a complex reality
As the global insurance industry is gradually recovering from the impact of the global financial crisis, the focus
of insurance companies is shifting from sustenance to driving growth. Insurance companies in mature markets
are shedding non-core businesses to de-risk and streamline their operations, and are also investing heavily in
technology to improve the core process. At the same time, insurers are cautiously rebalancing their geographic
footprint and seeking business line expansions to drive future growth. However, this growth is being restricted
by multiple macro-economic variables such as a sluggish Euro zone economy, persistent low interest rate
environment and softening prices in the non-life segment.
• Life insurance: During 2014, global life insurance markets benefited from a combination of strong equity
markets, realignment of product portfolios toward unit-linked and fee-based policies, and a return to double
digit growth in some of the emerging Asian markets. However, ongoing macro-economic uncertainties in
the Euro area and persistent low interest rates continue as strong headwinds.
• Non-life insurance: While below average catastrophe losses and a gradual upturn in economic activities
drove improvements across the non-life sector in 2014, softening rates in most markets are expected to
impact both top-line and margins through 2015.
In the near-term, insurers are expected to be favorably influenced by a gradual rise in bond yields and efficiency
gains made on account of investments in technology and digitization across the value chain by insurers
in recent years. Several factors, stemming from the recent environmental, technical and organizational
developments, are driving the following key trends in the global insurance industry:
• Life insurers mitigating the impact of persistent low interest rates
• Non-life insurers facing a gradually softening pricing environment
• Rising investments in advanced technology and digitization
• Emergence of health insurance as a growth opportunity
• Regulatory reforms becoming more frequent and stringent
Mitigating the impact of persistent low interest rates by realigning the product
mix, reorganizing operations and accessing high growth markets
The impact of prolonged low interest rates and falling yields on earnings and capitalization ratio remains a key
concern for the insurance industry, especially for life insurers as they offer savings products with guaranteed
returns. European life insurers are particularly exposed to low interest rates as the guarantees offered are more
generous and the duration of liabilities longer as compared to other markets. Also, a shift in the product
mix toward guaranteed benefit policies during 2009-12 further increased the insurers’ sensitivity for low
interest rates.
The recent rise in bond yields will likely help stabilize the sales of saving type products, such as annuities and
universal life, which have been under pressure for a long time. Moreover, if bond yields continue to improve
slowly in 2H15, it should boost the investment income and ease the pressure on sector’s earnings as well.
However, the ongoing low interest rate environment will continue to put pressure on guarantees and will
gradually drive down the earnings for the life insurers.
16. 16 | Indian insurance sector: Building Growth, Building Value
1.2%
0.8%
2.0%
1.0%
2.4%
0%
1%
2%
3%
4%
Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 Jan-15
Exhibit 3.1: Ten year government bond yields, 1Q'11-2Q'15
France Germany The UK Euro Area Central Govt The US
Source: S&P Capital IQ data
To navigate through this prolonged phase of low interest rates, life insurers are adopting several
strategies, such as realigning the product mix, minimizing guarantees, selling non-core businesses
and focusing on emerging markets.
• Realigning product mix: Most life insurers are shifting their product mix away from spread-
based products to fee-based products. Several insurers have reduced the emphasis on the
spread business, while raising the share of fee-based retirement, pensions and protection
business. These product mix shifts are aimed at reducing the exposure to low interest
rate risk. In addition, insurers are aggressively revamping their product design, including
increasing fees, limiting features, reducing guarantees and rationalizing bonus rates.
• Restructuring to streamline operations: Several life insurers are restructuring their operations
and shedding non-core businesses to reduce their exposure to interest rate sensitive
businesses such as banking and asset management. Insurers are also streamlining their
operations to improve efficiency and risk management to drive long-term profitable growth.
• Expanding footprint in high growth, emerging markets: With the focus returning to growth
and combating low interest rates in matured economies, insurers are seeking to expand
their presence in emerging markets, in order to capitalize on better growth dynamics. Many
global insurers are targeting acquisition opportunities in the emerging markets of Asia, Latin
America, and Central and Eastern European region.
Despite the modest
growth in bond yields,
the overall low interest
rate environment
remains a key concern
for the insurance
sector, mainly for the
life insurance sector
due to their guaranteed
savings product
offerings. To ease the
pressure, life insurers
must continue to
de-risk and realign their
operations.
17. 17Indian insurance sector: Building Growth, Building Value |
Negotiating soft market conditions (non-life) through tactical reinsurance
ceding, and smart capital deployment
The global non-life insurance premium growth, that remained relatively resilient during the financial crisis, is
observing a downward trend (dropped to 3.7% in 2014 from 7% in 2011). This moderation is primarily driven by
the softening of non-life rates across most regions and lines of business (particularly personal and commercial),
which in turn is due to relatively low volume of insured losses from major catastrophes since 2012.
• Property lines experienced the largest rate decline during 2014 across regions, due to continued strong
capacity and below average catastrophe losses in 2013 and 2014.
• US commercial lines price, although still positive, were mostly flat to up low-single digits.
• The UK and Continental Europe also witnessed a continuous drop in rates since 2013, particularly in the
casualty, and the financial and professional liability lines.
• Although the current low penetration and increasing wealth of the middle-class population are driving the
demand in emerging Latin American and Asia-Pacific markets, continued inflow of new capital is adding to
the capacity and putting pressure on the rates.
Exhibit 3.2: US P&C insurance rate changes (%)
-6%
-4%
-2%
0%
2%
4%
6%
Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15
Personal Lines Commercial Lines
Exhibit 3.3: UK non-life pricing change (%)
-20%
-15%
-10%
-5%
0%
5%
1Q13 3Q13 1Q14 3Q14 1Q15
Motor Pricing Property Pricing
Source: MarketScout Commercial Lines and Personal Lines Barometer Reports; Association of
British Insurers – AA Index
The industry has continued to experience rate softening across most markets and lines in first
half of 2015 which is likely to put further pressure on premium growth. While a divergent trend
appeared in the UK, where motor insurance rates rose in 2Q15 due to higher claims and imposition
of premium tax, the property insurance rates continued to decline.
To mitigate the growth challenges arising from rate declines, non-life insurers are adopting various
capital management strategies to protect margins and keep investors interested
• Harnessing the soft reinsurance market: Insurers are looking to take advantage of the
currently favorable reinsurance rates and terms to expand their exposure to high margin
coastal property risks.
• Scaling up inorganically: Insurers are deploying excess capital for mergers and acquisitions to
sustain growth and scale. During 2Q15, industry witnessed several high value deals.
• Maintaining investor confidence: Several groups are returning excess capital to shareholders
through increased dividends and share buy-backs.
As pricing power
declines, cyclical
adversities have begun
to set-in for the non-life
sector. Though benign
catastrophe losses have
masked the impact of
the rate softening on
earnings, sustaining
a profitable growth
will become a critical
issue for the insurers
in the coming years.
Nonlife insurers must
continue to implement
more effective capital
and cycle management
practices.
18. 18 | Indian insurance sector: Building Growth, Building Value
Increasing investments in technology and digitization to create a harmonious
ecosystem for all stakeholders
The continued rise in competitive pressures within the insurance industry has led to an increase in the
customers’ buying power and related changes in the customers’ and intermediaries’ preferences. These
environmental changes are driving insurers to invest in the transformation of core processes and the
modernization of legacy systems, particularly policy administration and claims systems, and to develop
and implement an effective digital strategy. Several major insurers have already initiated core system
transformation projects to improve customer service and speed to market. Digital channels and customer
analytics are also the priority investment areas for insurers to improve customer experience, distribution,
and process automation. According to Forrester’s research, the world’s largest insurance companies see the
Internet of Things (IoT), digital marketing, and big data as the key disruptive digital technologies for the sector.
According to estimates by Celent, the global insurance IT spending is expected to grow to US$189 billion by
2017 (CAGR 2011-17: +6%).
Forrester’s research also indicates that development of customer self-service portals, collaboration
ecosystems, and analytics competency are the top focus areas for insurance companies’ digital
initiatives for 2015 and beyond.
• Several insurers are investing to develop better digital self-service portals to improve
customer experience
• Enhancing customer value and stakeholder (distributors, TPAs and other partners)
engagements through a holistic digital ecosystem is another key priority for insurers
• A large number of global insurers are seeking to drive smarter decision-making by applying
data/customer analytics tools to leverage big data
Emergence of health insurance as a key growth opportunity
The global health insurance sector is forecast to grow at a CAGR of 5%9
during the period 2013-
17, and reach US$1.2 trillion10
by the end of 2017. Moreover, the private health insurance market
is forecast to grow at a faster pace across several markets.
9. EY analysis based on timetric – Insurance Intelligence Center data
10. EY analysis based on timetric – Insurance Intelligence Center data
Exhibit 3.4: Insurers' key focus areas for digital initiatives in 2015
(No. of insurers surveyed 200)
0% 10% 20% 30% 40% 50%
Operations
Agent portals
Digital marketing
Digitizing and Enabling STP
Analytics
Partner collaboration ecosystems
Source: The Digital Insurer in 2015; Forrester Consulting
Customer self service portals
With global economic
growth outlook
gradually improving,
insurance sector’s
investments in new
IT capabilities is
likely to increase
further. Insurers will
continue to invest in
emerging technologies,
including sensor-based
technology, to improve
operational efficiency
and extend customer
reach
19. 19Indian insurance sector: Building Growth, Building Value |
11. Population Challenges and Development Goals, The Department of Economic and Social Affairs of the UN
12. How Changes in Medical Technology Affect Health Care Costs; Kaiser Family Foundation
13. 2015 Outlook for Emerging Market Economies; EuroMonitor International
Exhibit 3.5: Personal health insurance - Net premiums earned forecast: 2015 – 2025
(US$ billion)
505
37
10 21
79
652
45
12 33
147
848
55
15
53
292
United States
Source: Timetric – Insurance Intelligence Center data
Germany Switzerland Japan BRIC Countries
2015 2020 2025
Multiple factors, stemming from macro-economic, demographic and regulatory changes are
catalyzing the growth of the private health insurance market
• Aging population with chronic health care needs: The global population of individuals aged
more than 60 years is estimated to triple from the 2010 levels to reach over 2 billion11
in
2050 — increasing from 11% to 22% of the world’s population. The individual health insurance
and nursing care offerings are likely to replace death coverage insurance as the main growth
and profit drivers.
• Rising health care costs: Globally, health-care expenditures are continuing to grow rapidly.
Since 1970, health care spending has grown at an average annual rate of 9.8%12
.
• Reductions in the Government’s welfare spending: In several large economies such as Italy,
France, Japan and Canada, the Government is adopting various fiscal tightening measures,
including reductions in social welfare spending. As social schemes become less generous,
people will have to increasingly spend out-of-pocket for their health care needs, which will
lead to an increase in the demand for private health insurance plans.
• Increasing disposable income in emerging markets: The middle-class population in the
emerging markets is expanding and their disposable income is increasing, enabling more
individuals to afford insurance policies. In 2015, the number of households with an annual
disposable income of over US$10,000 (PPP) in the 25 key emerging market economies is
likely to be around 845 million, which is expected to increase to 1300 million by 203013
.
• Health insurance reforms: In several markets such as Switzerland and Netherlands, the
Government has mandated compulsory enrolment to basic health insurance provided through
private insurers. In addition, insurers have the opportunity to write supplementary health
insurance that can be attached to the mandatory basic health insurance plans.
Against the backdrop
of rising costs, aging
populations, stressed
infrastructure,
constrained resources
and shifting regulations,
health insurance offers a
huge growth opportunity
for the insurance
companies across the
globe.
20. 20 | Indian insurance sector: Building Growth, Building Value
Against the backdrop of rising costs, aging populations, stressed infrastructure, constrained resources and
shifting regulations, health insurance offers a huge growth opportunity for the insurance companies across
the globe.
Regulatory reforms becoming more frequent and stringent
Globally, insurance regulations are becoming more intrusive and stringent, encompassing continuous
monitoring of risk management activities and financial performance of the insurers. The insurance regulators,
across regions, are seeking to introduce a new approach for setting reserve and capital requirements that not
only focuses on improving capital adequacy and liquidity, but also ensures insurers’ long-term ability to
honor commitments.
The European Union (EU) insurance sector regulator, the European Insurance and Occupational Pensions
Authority (EIOPA) is leading the way with the introduction of the landmark risk-based capital regulatory regime,
known as Solvency II. The Solvency II norms, which will become effective from 1 Jan 2016, will affect multiple
facets of the insurance business, including costs, governance and reporting. It aims at enhancing policy holder
protection, modernizing supervision to shift supervisors’ focus away from basic compliance monitoring,
deepening the EU market integration through harmonization of various supervisory regimes, and increasing
international competitiveness of EU insurers. Similarly, the International Association of Insurance Supervisors
(IAIS) also has plans to develop new global insurance capital standards (ICS) by 2016.
Geography Major developments
The United States Federal Insurance Office (FIO) submitted its long-awaited recommendations
to modernize insurance regulation, including capital adequacy, safety and
soundness, and marketplace regulation (December 2013)
China The China Insurance Regulatory Commission (CIRC) started the technical tests
to quantify the risk-based minimum capital for life insurers under its second-
generation solvency reform
Germany German insurers may need to build up more than €10 billion in extra
regulatory capital by 2016 to meet requirements under Solvency II regime
(As per BaFin, the German insurance regulator)
Canada The Office of the Superintendent of Financial Institutions plans to finalize the
life insurance capital framework by 2016
Mexico A three-pillar solvency framework, similar to Solvency II, being implemented
Oceania Eight Pacific Island nations’ regulators have developed regional and individual
country action plans to improve supervision of insurance and reinsurance
regulatory regimes. These are aimed at increasing insurance penetration in
this region’s under-developed insurance markets and attract long-term capital
The insurance
regulations are likely
to continue to become
more stringent in
coming years. With
these reforms underway,
insurers need to
proactively start
preparing for changes to
their risk management
processes, systems, and
reporting.
Most regulators are developing Solvency II type frameworks to ensure the protection of policy holder
wealth and confidence. Some key reforms in prominent geographies have been highlighted below:
22. 22 | Indian insurance sector: Building Growth, Building Value
4Trends and Issues –
Indian Market
23. 23Indian insurance sector: Building Growth, Building Value |
a. An elusive pursuit of a ‘cost-effective’ distribution channel
(life insurance)
Industry’s initial surge, particularly for life insurance, was driven by a myopic yet relentless hunt for capturing
market share. However, a relook at the cost structures to drive profitability in the ULIP 2.0 era post 2010
forced insurers to alter their distribution mix in favor of channels with lower overrides.
Agency: a flawed fixed cost model for most private players
The agency channel was the key growth driver for the sector until 2008. However, with reduced commission
structures on short-term products, extremely high attrition (at both agent and front line sales manager level)
and customer acquisition becoming tougher, agency’s viability remains under pressure. Also, high agency
costs on account of a fixed cost model amidst declining average productivity per agent despite reduced size of
agency makes the revival trickier.
Lack of attractiveness of the agency as a career proposition is another factor, which is hampering this channel’s
growth, as recruiting the right talent is becoming increasingly challenging. As a result of these adverse trends,
most agency-led insurers, apart from LIC, have either seen a drastic drop in new business volumes, or have
progressively raised their dependence on bancassurance. Subsequently, the number of offices in the private
space has gone down significantly from a high of 8,785 in March 2009 to 6,193 in March 2014 and at less
than a million, the agent count too is at a level not seen since 2007.
Exhibit 4.2: Number of offices of private life insurers
3,072
6,391
8,785 8,768 8,175 7,712
6,759 6,193
FY07 FY08
Note: Number of offices as on 31st March
Source: IRDA Annual Reports
FY09 FY10 FY11 FY12 FY13 FY14
-30%
890
1,327
1,593 1,575
1,302
1,081
950 993
0
200
400
600
800
1000
1200
1400
1600
1800
FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14
Agent count (000s)
Source: IRDAI Handbook 2013-14: state wise distribution of individual agents of life insurers
Exhibit 4.1: Individual agent count – private life insurers
24. 24 | Indian insurance sector: Building Growth, Building Value
Bancassurance: driving growth and profitability for some
With other channels struggling to match the new economic reality post 2010 changes, bancassurance
was the only major channel which performed favorably. A captive customer base, banks’ strong brand
recognition, ability to sell insurance as an add-on product with other banking products and a rapidly
expanding bank branch network allowed private banks to scale up their insurance business.
However, the benefits were restricted to a few players which successfully reduced their dependency on
agency and other third party channels and improved their cost to premium ratios significantly while gaining
scale and market share. As banks have increasingly influenced both volume and margin, insurers’ share in
profits has been on a wane in most recent bancassurance deals.
Brokers, still low on maturity
Insurance broking is a significant channel in developed markets, for both life and non-life segments. Globally,
this channel has been successful mainly because brokers are seen as customer representatives who advise
their clients on the most relevant product/solution to meet their requirements. However, in India, this market
is highly fragmented, with few large organized brokers, which often behave as expensive agents. Moreover,
most brokers are unable to offer a full range of services to the customers and lack specialization, often failing to
customize offerings in accordance with the customers’ requirements.
Corporate agents: shrinking insurance play
Of all major channels, corporate agents have witnessed the biggest decline in recent years. Between FY10 and
FY14, the individual new business written by corporate agents dropped by more than 79%. The key factors
driving this trend have been
• Excessive regulatory intervention in the corporate agency space to ensure a minimum level of sales quality
• Reduced interest from insurance companies on account of unviable terms from the established
corporate agents
• Extremely low quality business (particularly low persistency) written by fringe corporate agents, leading to
a lack of participation by insurers in tie-ups with such entities
50.7 46.9 44.1 39.7 40.1
24.9 33.2 39.0 43.1 43.6
10.3
8.7 7.5 6.0 4.03.4
6.4 5.1 5.1 4.9
10.7 4.8 4.4 6.1 7.4
FY10 FY11 FY12 FY13 FY14
Individual agents
Source: IRDAI
Banks Corporate agents Brokers Direct selling
Exhibit 4.3: Channel-wise distribution mix - Private life insurers
(as % of individual New Business)
25. 25Indian insurance sector: Building Growth, Building Value |
b. Non-life: slowdown in volume growth after a strong run
Globally, the non-life insurance market is known to grow in line with economic growth. Even in India, its growth
has moved in tandem with the nominal rate (real + inflation) of economic growth. In the last 10 years (FY05-14),
non-life gross direct premiums grew at a CAGR of 17%, which was slightly more than the nominal rate of GDP
growth (c.15%; real rate of GDP growth during this period was 7.7%). While growth rates averaged 22% between
fiscal years 2011 and 2013, the market has since witnessed a relatively modest expansion (FY15: 9%).
The key factor driving this relative slowdown has been the lagged impact of sluggish economic growth in recent
years. The motor insurance segment, which continues to be the biggest line of business within the non-life space
(contributed 46% of non-life gross direct premium in FY14), grew at its slowest pace in four years (FY14: 14;
CAGR of 25% during FY11-13). Weakness in motor insurance premiums’ growth is caused by the slow expansion
in the passenger vehicle segment where sales grew at 4% both in the domestic market and for exports.
The representation below depicts the correlation between non-life premiums with the country’s GDP growth
and annual motor sales. While motor sales have an immediate impact on the non-life premiums, there is a lag
between GDP growth/ decline and non-life premiums.
However, economic slowdown is expected to have bottomed out and economic activity will remain strong in the medium term leading
to a rebound in the non-life segment. According to World Bank’s estimate, India’s GDP is expected to grow at a rate similar to that
recorded in FY15 (7.4%), which is higher than the average 6.2% recorded during FY12-FY14.
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
35%
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
Exhibit 4.5 Growth trends - nonlife gross direct premium, GDP growth (nominal) and domestic motor sales
Non-life premium growth
Sources: General Insurance Council, IRDAI, World Bank, Trading economics, Society of Indian Automobile Manufacturers (SIAM)
GDP growth (Nominal rate) Domestic motor sales growth
Exhibit 4.4: Corporate agents' individual new business - overall industry (INR billion)
18.3
34.6 33.8 35.1
29.6
17.5
12.9
8.1
FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14
-77%
Source: IRDAI
26. 26 | Indian insurance sector: Building Growth, Building Value
c. Despite recent improvements, claim ratios remain adverse
(non-life)
Despite recording a double digit growth in eight out of the last 10 years, the sector has been making significant
underwriting losses from its core operations since 2007. The only major source of profits has been the
investment income on policyholder funds.
In FY14, the net incurred claims for the industry rose 15% to INR 457 billion up from INR 396 billion in FY13
and the underwriting profits have been non-existent since FY11. Among various segments, the health and
motor insurance lines, which are also the biggest and the fastest growing segments, had the highest claims
ratios (101% and 80%, respectively)14
.
110%
114%
119% 120%
126%
117%
112% 111%
80% 83%
86% 87%
93%
89%
83% 82%
50%
60%
70%
80%
90%
100%
110%
120%
130%
FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14
Source: General Insurance Council Yearbook (Underwriting)
Combined ratio Claims ratio
Exhibit 4.6:
The high claims cost has been driven by a combination of factors which include third party liability losses,
incessant price competition and unchecked fraud, particularly in the two largest segments - motor and health.
Motor third party liability pool: no respite in sight
The motor third party liability pool which was setup in 2007 was one of the main sources of underwriting losses
for non-life insurers up until 2011. The Indian Motor Third Party Insurance Pool (IMTPIP) was a mechanism
where all motor third party liability premiums for commercial vehicles were ceded into a pool and claims were
shared by all non-life insurers. This setup prevailed for almost five-years between 2007 and 2011 leading to
huge losses. The incurred claims ratio for motor segment rose to as high as 103% in FY2011.
The eventual dismantling of the IMTPIP in 2012 and introduction of Declined Risk Pool allowed insurers to
transfer only those risks which related to commercial vehicle third party liability that they were unwilling to
have on their books, to a pool administered by the General Insurance Corporation. This development provided
some relief to non-life insurers by freeing the pricing model and giving insurers the flexibility to price vehicles
based on claims. As a result, despite being adverse, claims ratio has been improving since FY11.
14. Source: IRDAI Handbook 2013-14
27. 27Indian insurance sector: Building Growth, Building Value |
The challenge of managing motor insurance losses is expected to continue as the regulator has made it
mandatory for insurers to have a minimum percentage of motor third-party (TP) business underwritten,
starting this year. This, coupled with a much lower increase in motor third party tariff than expected, could
prove to be a challenge for non-life insurers going forward.
Relentless competition with price being the only differentiator
Rise in the number of non-life insurers from 15 in FY07 to 28 currently coupled with the 2007 de-tariffing, led
to persistent price wars in a bid to gain market share. However, continued restrictions on the premium pricing of
the biggest non-life segment i.e. third party motor liability (which continues to be administered by tariff) implied
that the insurers continued to book major losses. Additionally, the inability of general insurers to differentiate
on the basis of product offerings along with the lack of customer awareness towards product features has kept
customers’ relationship with the general insurance industry to be extremely price driven.
The case of missing ‘utmost good faith’: Extremely high incidence of
claim-related frauds
Indian insurers have been struggling with controlling the costs incurred from fraudulent claims since a very long
time. While on one hand insurers face high cost of investigation and litigation, on the other hand, they grapple
with reduction in customer contentment levels due to delays in claims settlements for genuine customers.
Therefore, insurers often find honoring a fraudulent claim cheaper than investigating it.
Some common forms of frauds include:
• Tampering with the date of loss
• Exaggerated repair bills
• Concealment of pre-existing diseases
• Providing false information regarding the purpose of hospitalization
• Fake hospital bills and exaggerated claims
• Fraudulent pathology lab reports
28. 28 | Indian insurance sector: Building Growth, Building Value
d. Insurance regulations – from oversight to cautious
optimism
Regulations aim at driving transparency, simplifying products and services and creating a favorable ecosystem
for all the stakeholders. While the intent has been right, frequent changes in regulations continued to disrupt
the business models of insurers during the last decade. A plethora of changes within a limited span created
multiple operational and economic complications for both insurers and distributors. Some of the key changes
which played a dominant role in charting the course for the industry were the introduction of cap in charges on
linked products, restrictions on pension and index-linked products, and persistency norms for agents; while the
general insurance sector was affected by price de-tarrification and motor third party risk pooling arrangements.
Following is a snapshot of some of the key changes introduced since 2010:
2010 2011 2013 2014 2015
► Capping of charges
on ULIPs
► Declined risk pool
for motor third
party
► Health insurance
portability
► Restrictions on
referral
arrangements
► Guaranteed annual
return clause on
ULIP pensions
replaced with a
non-zero return
clause
► Persistency norms
implemented for
agents
► Health insurance
product
regulations and
standardized
definitions
► Proposed
guidelines for web
aggregators
limiting content
and remuneration
(implemented:
2014)
► Revised product
regulations for life
with minimum
death benefit
specification
► Ban on NAV
guaranteed and
index-linked
products
► Proposal for banks
to operate as
brokers
► Increased FDI
limits
► Development of
IMFs
► Hike in motor TP
premium rates
► Shift from ULIP to
traditional
products
► Dis-incentivized
agents
► Non-profitable
branches were
shut
► Motor TP line‘s
viability improved
► Flexibility for
customers
► Share of pension
products in Life
Insurance
individual new
Business dropped
from 33% in FY10
to 4% in FY12
► Persistency norms
contributed to
increased exodus
of agents
► Better
understanding of
terms by the
customers
► Increased access to
reliable health care
for insurers
► Growth of web
aggregation market
limited by curbs on
advertising and
tie-ups
► Up to one-third
sales impacted and
margins eroded for
several insurers
► Opposition from
banks towards
broker model
► Capital infusion to
aid in improved
quality and
expanding reach
► Much needed
career progression
for agents via IMFs
► Increased viability
for the TP motor
line of business
Source: EY Knowledge Analysis
Exhibit 4.7:
ChangeImpact
29. 29Indian insurance sector: Building Growth, Building Value |
While a number of changes in the recent past had an adverse impact on the sector, some of the recent
regulatory developments have shown a progressive outlook, while focusing on interests of all stakeholders:
1. Insurance Laws (Amendment) Act 2015 – multiple positives for insurers15
Increase in insurance FDI limits as a part of the new Insurance Bill is expected to help insurers with more capital,
technical know-how and expose them to global best practises.
Foreign partners keen on larger equity participation
Considering the positive market sentiments in the country and improved investor confidence, several Indian
parents of insurance companies are looking at diluting their stakes to capitalize on a good valuation. Global
insurance companies are equally excited at the prospect of having a greater stake in the growing, under-
penetrated Indian insurance market. So far, multiple global majors have shown interest in raising stake in their
Indian subsidiaries.
Elimination of standard prescribed expense limits
As per the old provisions, an insurer’s annual management expenses had to be within prescribed limits, which
restricted the ability of the insurer to diversify into untapped geographies entailing high set-up costs. With
the passage of the law, this clause has been eliminated from the act, giving more power to the local regulator
(Insurance Regulatory Development Authority) to regulate management expenses. It provides flexibility to the
regulator to prescribe a broad architecture to define expense limits.
Flexibility on the maximum commission to agents
Earlier provisions prescribed the maximum amount of commission which is payable to an insurance agent
or any other intermediary. While this clause was aimed at containing the inorganic growth by insurers who
could heavily compensate the intermediaries for getting business, in reality insurers managed to create
alternate routes in making high distributor payouts. In response to an already prevalent practice adopted by
most insurers, the restriction on commission payouts has been dropped. Instead, the regulator is expected to
regulate the commission at a product level, thereby ensuring meeting of product margins.
Elimination of renewal commission to non-agents
The amended bill has responded well to the burning issue in the insurance industry of high agency attrition,
impacting both productivity and activity. As per the earlier provisions, an insurer was required to continue
paying renewal commission to an agent who has served a minimum of five years with the company, irrespective
of whether he/she is still an agent of the company or not. Post the amendment, insurers are not required to pay
agents who cease to be associated with them.
Responsibility of appointing advisors entrusted to insurers
The new regulation equips the regulator with the power to frame regulations to regulate the agent’s eligibility,
qualifications and other aspects. In lieu of the same, and the consultative approach of the regulator, insurers
have now been given the sole right to appoint the agents without any intervention from the regulator.
Withdrawal of requirement of deposit with the RBI
Insurers were earlier required to maintain a deposit of USD 1.5 mn with the Reserve Bank of India. In the
amended bill, this requirement has been waived off, offering flexibility to new insurers with lower top-line to
effectively deploy this additional fund.
15. Press Information Bureau, Government of India, Ministry of Finance, 13 March 2015
30. 30 | Indian insurance sector: Building Growth, Building Value
2. Development of Insurance Marketing Firms (IMFs) – the birth of a
new channel
IMF as a new distribution channel is expected to give distributors, especially agents, a logical
career progression and at the same time limit mis-selling for customers due to a professional
outlook expected to be adopted by these firms.
The lower capital requirement for setting up of an IMF combined with the fact that they can be a
one-stop-shop for all financial needs of a customer makes IMF a lucrative choice for independent
financial advisors and certified financial planners. For insurers, especially the newer ones, IMFs can
thus be an effective distribution channel to help increase footprint in untapped segments without
significant capital drain.
3. Insurers mandated with fiduciary responsibility and accountability
towards customers
The regulator has often taken steps towards the protection of the policyholder and customer
interests, by mandating processes, several reporting requirements, and imposition of penalties.
However, the new bill has further tightened the regime:
• Governance: As per a provision of the Insurance Laws (Amendment) Act 2015, no life
insurance policy can be questioned on any grounds for three years from the date of the policy.
• Intermediary accountability: Insurers are now responsible for all the acts and omissions of
their agents, including violation of the code of conduct specified by the regulator.
• Increased penalty: Insurers are liable to a penalty of up to US$0.15 million for the acts and
omissions of their agents. Similarly, a standard penalty of up to US$4.0 million has been
included for failing to comply with the rural or social sector obligations of the or third party
motor insurance.
4. Revision of third party motor premium rates and assessment limits
IRDAI raised the Third Party motor premium rates in order to curtail the persistent losses recorded
by the non-life sector in recent years. While the hike was below the original draft released by IRDAI,
it was still a step in the right direction. Additionally, IRDAI is also contemplating hike in third-party
insurance assessment limits, i.e. the level of claims that would require surveyors to assess losses.
If implemented, this would imply that insurance companies will be able to settle claims of a higher
value for property and motor lines without engaging surveyors. However, this can be detrimental
to the c.11,000 surveyors who may end up losing a bulk of their business.
It is desirable that the
industry is allowed
adequate time to adjust
to major regulatory
changes post a
thorough regulatory
impact assessment.
After all, such changes
often have a notable
impact on customer
experience and
perception towards
insurance industry.
With a greater flexibility
post the Insurance
Laws (Amendment) Act
2015, the regulator
can take stronger
steps to facilitate
financial education
and awareness about
insurance products.
Considering that
currently a majority
of sales, particularly
in the life segment, is
accounted for by tax
incentives rather than
any specific demand
from customers, such
steps can go long way
in creating a customer
pull and driving growth
for industry in the long
run.
31. 31Indian insurance sector: Building Growth, Building Value |
e. Pensions and retirement offerings – a major gap in life
insurers’ product portfolio
India is currently one of the world’s youngest nations with 31% of population under 14 years of age, and around
60% under the age of 30. However, with rising life expectancy and declining birth-rates, the rate of growth
of India’s elderly population (those above 60 years of age), during 2010 to 2030 (est. 3.6%), will be much
higher than the average rate of overall population growth during the same period (est. 1.1%). As a result, the
percentage share of 60+ populations, which was 8% in 2010, is expected to reach 12% by 2030.
The factors which necessitate the presence of a strong pension market in India are:
• Absence of a robust Government-backed social security system
• Limited segments of population, such as the organized salaried class, being currently covered by the
existing pension plans
• Diminishing social support system with the reducing size of families
• High rate of inflation implying high cost of living in future years
All these drivers are certain to spur the demand for retirement products such as pension and annuity in the
times to come. Pension products cover longevity risk and are typically an important segment in the financial
services space for most economies. Hence, given the increased longevity in an inflationary environment
combined with the absence of a Government-sponsored social security plan, post-retirement income and
health-care insurance are critical for the Indian population.
37% 35% 31% 27% 24%
27% 28%
28%
26%
24%
30% 31% 34%
37%
40%
6% 7% 8% 10% 12%
1995 2000 2010 2020 2030
60+ 30-59 15-29 0-14
Exhibit 4.8: India’s population projection
Source: “Population Division”, United Nations Department of
economic and social affairs
32. 32 | Indian insurance sector: Building Growth, Building Value
Challenges which ail the penetration of pension products in India
The prime factors responsible for the unexpected absence of pension as a major product segment in India are
competition from other financial products, lack of specific government interventions, deficient risk transfer
mechanism, an underdeveloped annuity market, low level of awareness towards retirement savings and
customers’ high preference for tangible assets:
Competition from other financial products
Higher returns offered by other financial products and lack of specific tax breaks for pension products imply
that pension products appear low in the order of preference for most customers.
Preference for physical assets and short-sightedness
A major part of society in India still finds physical assets such as gold and real estate to be a more reliable bet
for old age savings than a pension product. Also, most customers are interested in short-term returns, and
are unwilling to participate in a very long-term investment. As, a result even fixed deposits have a much
higher demand.
Lack of awareness among customers
Customers are still not aware about how much they need to save for retirement and why they need to start
early. As a result, they end up making wrong bets when it comes to managing their savings.
Absence of a dynamic market for annuities
A dynamic annuity market, which is imperative as a support system for a strong pension market, is poorly
developed in India. Without a well-defined regulatory framework, the market has limited products to offer
and lacks innovation. While low financial literacy, a false notion of life expectancy, inheritance motives and
alternative savings restrict the demand for annuities, the supply is equally restricted by an insufficient
supply of long-term financial instruments for the purpose of hedging long-term risks and adverse selection,
among others.
Scarcity of annuity providers and narrow product market
There are not many annuity providers in the market. Not many life insurance companies in the country have
the necessary experience in risk management, and the requisite solvency capital to serve in this capacity. An
authorization exercise to select these providers is still pending. With the majority of plans launched being either
participating or non-participating deferred annuities, India’s annuity market is very restricted in terms of the
range of products on offer. Immediate annuities on offer are very few in number, and are launched only by a
single insurer. This hardly gives options to interested investors.
Difficulty in providing long-term insurance guarantees
The absence of an effective reinsurance mechanism for hedging long-term annuity business and the adverse
experience of global insurers due to their earlier long-term guarantees on annuity yields have prevented life
insurers from participating aggressively in the pension space. Till FY10, when insurers were actively
promoting pension products, the risk was completely with the customers, as most pension products were
market-linked. However, with IRDAI mandating capital guarantee for such products, most insurers exited this
particular segment.
33. Indian insurance sector: Building Growth, Building Value | 33
Following illustration shows how as a segment, pensions and annuities collapsed for life insurers post the 2010-
11 product changes:
India’s pension sector is
crucial for the growth of
the country’s economy,
since pension funds can
support the funding of
long-term infrastructure
projects, bring stability
in capital markets,
and enable its growing
elderly population to be
financially independent.
Given the state of
the industry today, a
concerted effort from
all the key stakeholders
is required to institute
fundamental changes
in the functioning of
the pension industry to
address the key issue of
security in old age.
24%
33%
25%
4% 3% 4%
FY09
Source: Life Insurance Council
FY10 FY11 FY12 FY13 FY14
Exhibit 4.9: Share of pensions and general annuities in individual new business premium
34. 34 | Indian insurance sector: Building Growth, Building Value
5Way forward and
imperatives for
Indian insurers
35. 35Indian insurance sector: Building Growth, Building Value |
a. Pursuing efficiency in distribution
A distributor is typically the first touch point through which a customer identifies an insurance company and
is the enabler who pitches products based on customers’ needs, and finally closes the sale. In the process,
it serves as the backbone for ground level insurance operations in terms of driving KYC and enabling the
transaction. A distributor is also the default listening post for most customers. Owing to its’ criticality for the
success of an insurance business, a cost-effective distribution model is naturally the biggest logistical challenge
which the insurers face.
While the larger players with captive bancassurance tie-ups have been successful in achieving distribution cost
efficiencies, others are yet to reach a stable state. All the other key channels – agency, corporate agency and
brokers have struggled to keep costs low in proportion to the value of new business underwritten. Given the
complexities in the current distribution models, a complete revamp is unlikely in the short-term. However, what
should work are incremental yet strategic interventions, which gradually improve the face and reputation of
insurance distribution.
Collaborating to drive pan-industry talent development
The key reason most channels are unable to operate in a cost effective manner is skill-deficiency among the
salesforce. This lack of proficiency, in identifying the right customers, approaching them in the right manner
and with the right offerings, leads to low performance and a subsequent lack of interest in the job for a frontline
employee/agent. This finally reflects as an exit by choice or as a termination by the insurance company. The
insurance industry currently faces a major scarcity of manpower with the right acumen to drive customer
engagements and sales.
While creating a strong learning and development infrastructure may not be feasible at an individual insurer
level, it can be realized by an industry-wide effort. A common and robust skill building framework can go a long
way in creating a large pool of resources for the industry to depend on.
Unified service support for third party distributors
Typically, the partnership between an insurer and a third party distributor (primarily corporate agents,
including banks, and brokers) has been transactional. The distributor engages customers, closes a sale and
finally, receives a relevant compensation from the insurer. However, what will make this process efficient is the
insurer partnering the distributor at each level of the value chain. The insurer can proactively provide relevant
customer analytics, create a product portfolio aligned to the distributor’s own attributes, make available
appropriate sales tools, and provide dedicated operational support for policy servicing. Such an integrated
partnership will simplify sales for the distributor’s sales personnel, improve customer experience, and will allow
the insurer in aligning the distributor with its own priorities.
Optimizing network distribution
Insurers must revisit their network planning strategies and re-align the distribution network mix in line with the
economic potential of a region or a city. The right mix of full service branches, satellite branches and presence
through a local partner must be carefully assessed based on the region’s potential and the insurer’s ability to
successfully address the requirements of the local customers.
36. 36 | Indian insurance sector: Building Growth, Building Value
Multi-channel approach:
The new age customer doesn’t interact with just one distribution channel. Through multiple touch-
points/channels, the customer first knows about a product; then compares it with similar products
offered by the insurance company itself and by those being offered by competitors, and finally
completes the sale through any one of the channels. Insurance companies that can seamlessly
integrate the operations of new and alternative channels with traditional channels to present an
integrated view to the customer, will likely be best positioned to enhance operational efficiency and
benefit from customer’s behavioral changes. By developing a multi-channel distribution network,
insurers are likely to derive tangible benefits in the following ways:
1. Multi-distribution model will allow the insurer to derive the benefits from each channel to
enable a unified service delivery for customers.
2. Integrating new, alternative channels is likely to boost the productivity of the traditional
channels by increasing the volume of the leads generated. Also, the lead generation through
one channel can be used to close sales via another channel, thus improving the overall lead
conversion rates for the insurers (while ensuring that there is no cannibalization among
partners).
3. Interacting with a particular customer or customer segment via multiple channels will allow
the insurer to gain greater insights about customers’ preferences
b. Making the most of the Insurance Laws
(Amendment) Act 2015
After nearly seven years of being tabled in the Parliament, the Insurance Laws (Amendment) Act
2015 finally came into effect earlier this year. The major changes included greater availability of
capital, enhanced flexibility for the regulator, higher power to the life and the general councils and
permission to foreign reinsurers to set up shop in the country. Following are some ways in which
insurers can leverage these positives into a long-term advantage:
Collaborating to drive customer awareness
With capital infusions allowing a higher spending power, insurers can now actively work in
partnership with the Government, the regulator and the industry bodies to attract public interest
towards insurance. Such a drive can alter insurance’s current perception among customers of
being a mere tax saving instrument to being a critical component for long-term financial security.
Avail reinsurance expansion to design higher margin products
With the amended law enabling foreign reinsurers to set up branches in India and with major
global players displaying keenness to enter the Indian market, risk transfer through reinsurance
by insurance companies is set to get a fillip. This will allow insurers to design high margin high-risk
products for specific customer segments and channels; and enter product categories such as long-
term care without taking significant risks on their balance sheet.
Insurers continue
to take multiple
productivity enhancing
bets across the
value chain such as
technology enablement
of individual agents,
targeting each channel
with the dedicated
product mix in line
with a channel’s
cost structures, and
eliminating costs
wherever possible.
However, to disrupt the
status quo, concerted
efforts will be required
not just by specific
insurers but by the
industry as a whole in
collaboration with the
regulator.
37. 37Indian insurance sector: Building Growth, Building Value |
Reach out to hitherto underpenetrated customer segments
Increased investments will allow insurers to beef their distribution muscle and expand in the under-
penetrated segments of the population, particularly those in smaller towns and non-urban areas,
where other than public sector companies; only a few private players have a strong presence.
Insurers can better equip their sales personnel with technology enabled tools and adequate
training to effectively meet the requirements of the identified target customer segments.
Adopt global best practices to enhance operational efficiency
Increased availability of the capital and know-how from foreign parents will go a long way in
plugging the infrastructural gaps faced by insurers. From revamping policy administration systems
to improving claims settlement processes, insurers can raise operational efficiency at each level
of the value chain. Such improvements can provide a major boost to the long-term profitability of
insurance companies.
Raise service delivery standards to boost customer engagement and
reputation
Through greater foreign participation, insurers will be exposed to world class customer servicing
tools and methods which can significantly improve the way in insurers reach out to their
customers. Insurers can make greater investments into customer relationship management, which
will have favorable implications in the form of improved persistency and reduced surrender rates,
both being much higher than the global average.
c. Awaiting a paradigm shift: exploring possibilities in
the pension space
To develop the long-term pensions market, it is imperative that the Government and the regulators
put together a concerted effort in encouraging and developing the long-term asset market. With
the right assets available in the market for long-term risk free investments, the pension providers
will be in a position to develop and distribute appropriate pension products.
The possible options which can lead to the establishment of a robust pension market can only be
arrived by identifying the broad issues faced by the industry, which are:
• Customers’ lack of awareness about the need for pensions
• Absence of relevant products
• Pensions system’s low penetration
• Dearth of appropriate incentives for all stakeholders
A combination of the following initiatives, addressing each of the above issues can be a game
These latest policy
changes are expected
to go a long way in
driving the sector’s
next wave of growth.
However, to realize the
true potential of these
changes, insurers must
ensure that their actions
are carefully thought
through and aimed at
driving a growth which is
balanced in all respects.
38. 38 | Indian insurance sector: Building Growth, Building Value
changer for the industry16
:
1. Addressing customers’ lack of awareness about the need for pensions
Some of the possible desirable actions on this front are:
• Understanding customer aspirations and identifying the needs of specific segments, e.g., rural and
urban, working age groups and people past retirement age through in-depth market research
• National level education campaigns by the Government, regulators covering the need for pensions,
inadequacy of current pension provisions and the avenues available for retirement savings
• Investing in the training and certification of individual pension advisors for providing the right
pensions advice to customers on a large scale
2. Creating relevant pension products for the market
In order to create appropriate products, pension providers may take the following possible actions:
• Enhance attractiveness of annuity plans through appropriate pricing and innovative offerings e.g.,
impaired life annuities
• Pension fund managers should aim to achieve adequate returns to enable customers in achieving the
desired fund corpus on retirement
• Offer guarantees and price them adequately
• Pension Scheme actuaries to advise trustees and sponsors of occupational pension schemes.
Insurance companies’ actuaries to design and manage pension plans as per principles of “public
interest,” allowing for appropriate profit margins and ensuring regulatory compliance
• Global mobility of human capital means that the cross-border movement of retirement funds could
potentially be a big opportunity. This would require initiatives at Government, regulatory and product
manufacturer/plan sponsor’s level to seek approval of overseas pension’s regulatory bodies to agree
upon mutual recognition of the pension schemes
3. Improve participation into the pensions system
The key initiatives that may be considered to enhance coverage of pension plans are:
• Auto enrolment into pension schemes, e.g., NEST scheme in the UK
• Mandatory enrolment into pension schemes, e.g., raising the salary ceiling for EPFO subscription
• Use prevailing distribution networks like India Post, co-operative banks, NGOs, self-help groups, micro-
finance institutions
• Open up the existing schemes for wider participation, e.g., access to EPFO for the people working in
the informal sector, allowing higher contributions in PPF
4. Incentivize stakeholders to actively develop the pensions sector
All stakeholders need incentives to play their role in the development of the pensions sector. The
customers need tax breaks, the providers aim at reasonable profits and the regulator expects that
customers are treated fairly along with the smooth development of the sector, as well as 100% compliance
with regulations.
• India can have a preferential tax rate for the income-earned from retirement funds and for retirees,
similar to the practice being followed in Netherlands, where the tax rate of a pensioner is 18% lower
than the tax rate of an employee.
16. Pensions business in India, November 2013, EY
39. 39Indian insurance sector: Building Growth, Building Value |
• The pension product structure needs to allow for appropriate income for all stakeholders, e.g.,
incentive for the distributors to advice customers. The regulatory framework should help in striking
a balance between the profitability of pension providers, the income earned by distributors and the
value delivered to the customers.
• The regulations around occupational pension plans would help improve the governance of employer-
sponsored retirement plans and also help employees achieve the desired income replacement ratio
after retirement.
• The Government may provide appropriate financial support for economically deprived sections of the
society example, paying a contribution equal to the contribution by the member of the plan, providing
capital guarantee.
d. Further penetrating the health insurance market
Increased customer awareness, high health-care inflation, fast progression of medical technology and greater
incidences of diseases/sickness due to changed lifestyle has facilitated the growth of health insurance segment
in India over the last 15 years. Health insurance premiums grew at a CAGR of 30% between FY06 and FY14.
As a result, the share of health insurance in the total non-life gross direct premium has increased from 10%
in FY06 to 22% in FY14. The fact that five standalone health insurers have entered the Indian market in the
private space in recent years signifies the interest which this segment has generated. Its growth has also been
enabled by the availability of a greater number of choices for customers (products like Daily Hospital Cash
benefit, and add-on critical illness rider) and favourable regulatory interventions, such as rural health schemes
and health insurance portability.
Exhibit 5.1: Health insurance gross direct premium (FY06-14)
(in INR billion)
22.2
156.6
0
20
40
60
80
100
120
140
160
180
200
FY06 FY14
Non-life insurers
Source: IRDAI Handbook 2013-14, General Insurance Council
Standalone health insurers
CAGR 30%
22.5
179.1
40. 40 | Indian insurance sector: Building Growth, Building Value
Despite this meteoric rise over the years, the health insurance space is plagued by a host of
issues which directly impact the profitability of the insurance companies and the overall customer
experience. At 100.7%17
during FY13-14, the industry continued to observe an adverse claims ratio,
partly on account of high incidences of fraud. In order to maintain this growth momentum and to
enhance the viability of this business, the following measures can play a critical role:
Improved framework to curtail fraud
Fraud risk exposure from claims is a major area of concern which continues to have an adverse impact
on the overall costs for insurers and premium charges for policyholders. Each insurer needs to adopt
a definite methodology to identify and address risks of fraud within it. Some of the areas that a good
fraud risk management process should cover include a well-defined whistle-blowing policy, periodic
fraud risk assessments, a pre-employment screening, and vendor background checks.
Greater role by life insurers
Health insurance products contributed just 0.3%18
of life insurance companies’ individual new business
premium in FY14. Given the long-term nature of the health products offered by life insurers (contrary
to the short-term nature of products provided by non-life and standalone health insurers); these
products may appeal to a large section of population. Also, the fact that these can be bundled with
other long-term life insurance products makes an interesting value proposition for customers.
Engaging customers early
Unlike a life insurance policy, where a customer gets a lower premium rate for the entire payment
duration if enrolled at a younger age, there is no such incentive in case of health insurance. As a
result, customers tend to purchase a health insurance policy only in the later stages of their life when
they expect a greater health risk. By providing incentives and signing up a larger pool of healthy and
young population, health premium rates can be expected to moderate and become more attractive for
a wider population.
Cost effective health insurance products for the elderly
Currently, the industry offers limited products for the population above the age of 60. Also, the
high premium charges for the existing products generally make these products unviable for most
customers in this segment. In a scenario where the population growth for those in the age bracket
60 or more is expected to be much higher than the overall rate of population growth, developing a
cost effective solution for this customer segment is crucial for the overall growth of health
insurance segment.
Combo products with savings elements
The fact that customers typically buy insurance as an investment or a savings product makes a strong
case for combo offerings, which add a savings component to the health insurance premium, where a
customer also participates in creating a long-term fund.
Raise service proficiency
Improved servicing capabilities for customers towards claims management, when a customer is in
distress and helping them understand the technical aspects of the policy during the purchase will
create a strong sense of trust among customers.
17. General Insurance Council
18. Life Insurance Council data
The biggest test for
the health insurance
segment in the coming
years will be to ensure
that it transforms
from being a provider
of basic health
protection products
to providing holistic
offerings which cater
to the ever evolving
life style changes
across customer
segments. With
favorable regulatory
developments, such
as recognition of
health insurance as a
separate vertical (as
per Insurance Laws
(Amendment) Act
2015) and IRDAI’s
efforts towards creating
a new health insurance
framework, lending
support to the current
growth drivers, health
insurance segment is
expected to maintain
its status as one of the
fastest growing lines
of business for the
foreseeable future.
41. 41Indian insurance sector: Building Growth, Building Value |
e. Solving the cost conundrum by a greater use
of technology
India’s insurance sector has faced significant regulatory headwinds over the last decade, which necessitated
greater price transparency, condensed margins and reduced flexibility to price products. As a result, managing
costs has increasingly developed into a key lever for profitability.
While for life insurers, the key pain area from a cost perspective is their high fixed-cost operating models,
for the non-life insurers it is their inability to correctly price products leading to excessively high claims in
proportion to the premium collected.
For private life insurers, the cost ratios have failed to moderate beyond FY11 as aggressive cost rationalization
efforts starting FY11 led to substantial drop in new business collections, particularly for players sans a major
bancassurance alliance.
Exhibit 5.2: Cost ratios19
for private life insurers
11.0%
10.0%
8.5% 7.5%
5.7% 5.3% 5.7% 5.3%
23.2% 23.5%
26.3%
21.3%
18.5% 17.9%
19.3% 19.5%
0%
5%
10%
15%
20%
25%
30%
35%
40%
FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14
Commission to net premium ratio Operating expense to net premium ratio
Source: IRDAI Handbook 2013-14
While the non-life insurers have seen improvements since FY11, their combined ratios continue to be adverse
and worse than the global norms. (The average non-life claims ratio for most North American and European
economies in recent years has been roughly 70%20
, compared to a figure of around 90% for Indian insurers.)
A robust cost management framework requires targeted investments in technology across the value chain,
particularly to drive operational efficiencies, minimize redundancies across channels and reforming the claims
management process.
19. Operating expenses includes both ‘Operating Expenses related to Insurance Business’ & ‘Expenses other than those
related to Insurance Business’
20. World Insurance report 2014 by Capgemini
42. 42 | Indian insurance sector: Building Growth, Building Value
Achieving operational efficiency through information system integration
across partners
Manual processes, prolonged processing cycles, and disparate systems act as barriers to the speed at which
the insurance industry conducts business. Insurers interact and transact with several third party entities, such
as individual and corporate agents, brokers, third-party administrators (TPAs), vendors, etc. During these
interactions, real-time exchange of data usually becomes a logistical issue due to a lack of integration between
the information systems at the insurance company and those at the external partners. Partner integration
systems help insurers integrate their systems and data repositories with those of their partners, and enhance
operational synergies. These systems automate data transfer, reduce the sales cycle and minimize the time
required to service customers. Moreover, these systems support web services and provide insurers the flexibility
to adapt to the changing business needs.
Implementing a modern and integrated claims management system
An integrated claims-processing system aids in simplifying processes and improving claims resolution, resulting
in lower costs and enhanced customer fulfillment. Such a system can minimize the complexities of the legacy
systems and can achieve compatibility across multiple internal systems (such as policy administration and
management reporting systems) and third party systems.
An integrated claims management system avails modern technologies such as service-oriented architecture
(SOA) to enhance business flexibility, enable straight-through processing, and support control and monitoring
functions. It allows for efficient online filing of claims and supports integration of systems across product lines.
Additionally, an integrated system minimizes the number of hand-offs, manual interventions, and process
delays by making the claims resolution process a lean one.
Exhibit 5.3: Benefits of implementing a modern and integrated claims system
Improved Claims Adjudication:
► A web-enabled integrated claims
processing system improves
efficiency across the claims
resolution and pay-out process
► Aids application integration that
reduces the claims processing cycle
time
Reduced Management Costs:
► Elimination of process gaps reduces
loss adjustment expenses
► Implementation of analytics
capabilities reduces claims leakages
expenses
Improved Claims Adjudication:
► Reorganizes the complex legacy claims
systems by leveraging service-oriented
architecture (SOA)
► Aids real-time integration with 3rd party
vendor systems
► Reduces number of hand-offs and
unnecessary process delays
Continued Improvements:
► End-to-end monitoring of the claims
process cycle
► Collection of key business and technical
performance indicators
► Continued review and monitoring
Core
claim
system
Serviceorientedarchitecture
Business flexibility
Control and monitor
Straightthroughprocessing
Source: EY Analysis
43. 43Indian insurance sector: Building Growth, Building Value |
Leverage analytics to manage fraudulent claims
Fraudulent claims cost continues to be a major issue being faced by insurers. Insurers face a
twin challenge on frauds — on one hand they face high cost of investigation and litigation and
on the other hand, it leads to customer remorse due to delays in claims settlements of genuine
customers. Therefore, frequently insurers find honoring a fraudulent claim cheaper than
investigating it. While most insurers have instituted a claims fraud detection framework, they need
technology enabled processes which can detect and prevent fraudulent claims at a cost less than
the costs for honoring such claims. Following advanced analytics tools can help in
this regard:
• Rules-based systems to test each claim instances against a set of pre-defined business rules to
detect fraud patterns.
• Exception reporting to highlight claims cases where a threshold for a particular measure
is exceeded.
• Predictive modeling to produce fraud propensity scores by using data-mining tools and
programs to detect complex fraudulent claims patterns.
• Social networking analysis to identify fraudulent activities by establishing relationships with
people involved in claims.
By implementing an analytical solution to calculate the propensity for fraud at each level of the
claims value chain, right from the first notice of loss to the final claim settlement, insurers can
boost their effectiveness in combating fraud.
Adopting usage based insurance technologies – particularly in motor
Usage based technologies such as telematics will go a long way in the correct assessment of risk
and pricing products based on the real experience. Globally the adoption rates for technologies
like telematics are rising at a fast pace while reaping advantages for both the insurers and
the customers. By 2020, it is expected that more than a quarter of the US and Canadian auto
insurance premium revenue will be generated via telematics, representing over US$30 billion21
.
While some Indian non-life insurers are also known to have begun pilots in this area, there is a
need for adopting such technologies in a big way. Correct pricing or elimination of customers with
undesirable traits at the underwriting stage can lead to huge savings from unwanted claims.
f. Embracing ‘Digital’ – disrupting the traditional
business structures
Digital transformation represents the continuous disruption to existing business models, products,
services and experiences enabled by data and technology. With traditional operating structures
being challenged, insurance executives must re-evaluate their future direction and make the digital
agenda a high priority.
Digital technologies can be embedded across the core elements of the insurance value chain, right
from product development to claim settlement. An effective digital strategy can allow insurers
to reduce customer service costs, increasing customer fulfilment and retention, while enhancing
21. http://telematicswire.net/navigating-the-telematics-journey-through-motor-insurance-industry/
Reducing costs is a key
area where technology
plays a major role.
However, greater use of
technology also ensures
that insurers stay future
ready, minimize risks
on account of manual
interventions and enable
robust decision making
at both the leadership
and operational level.
44. 44 | Indian insurance sector: Building Growth, Building Value
process efficiency. In pursuit to become a true digital company, developing mobile applications and enhancing
data capabilities to leverage analytics are the key investment areas for the insurance companies. Developing
mobile applications is also critical owing to the brisk pace at which smartphone adoption is increasing in turn
driving an increasing demand for real time services. Mobile applications offer a huge potential for enhancing
customer service experience in the form of speedier sales closure, greater access to policy details and even for
making hassle-free renewal payments.
Product design Front office Underwriting
Policy
administration
Claims
Management
Product Design and
Manufacturing
Marketing, Distribution
and Channel
Management
Underwriting
New Policies
Policy Acquisition
and Servicing
Claims Servicing
and Payout
► Advance customer
analytics and
diagnostic tools,
like telematics
► Channel sensitive
pricing and
product
differentiation
► Customization of
product
► Optimization of
speed to market
► Ease of product
configurability
► Regulatory
responsiveness
► Integrated
multi-channel
marketing
► Extended
multi-device and
mobility offering
► Centralized
distribution-related
support functions
► Customer needs
management –
360° view of
customers
► Self-service
processing
capability
► Real-time
information on
policy application
status
► Real-time
information
capturing
► Advanced risk
analytics enabling
risk based pricing
► Customer value-led
promotions and
discounts
► Automated
workflow
management and
rules engines
► Straight through
processing (STP)
► Integration with
analytics and data
management
system
► Self-service
capability and STP
► Automated
renewal notice,
premium reminder
► Automated billing
with multiple
payment options
► Anytime access to
policy details/view
policy document in
electronic format
► Instant notification
of the claim
through advanced
hand-held devices
► Digitally enabled
claims document
submission
► Real-time claims
status monitoring
► Claims status
updates through
E-mail, Alerts, SMS
► Analytics-based
fraud detection
► Digitally enabled
data management
Exhibit 5.4: Potential impact of digital transformation on the insurance value chain
Source: EY Knowledge Analysis
EY’s recent Global Digital Survey22
found that insurers who can differentiate their customer service experience
through a carefully designed, thoughtfully executed and adaptable digital strategy are more successful than
their competitors at reducing customer service costs while increasing customer retention.
Analytics – a critical element for digital success
With technology changing so rapidly, insurers need new skills to exploit the digital opportunity. According
to EY’s Global Digital Survey, analytics capabilities (segmentation, customer data and predictive modeling)
emerged as the most in-demand skill set for the insurance sector.
The insurance companies need to gradually move from analyzing historical data to predicting future patterns
by leveraging business intelligence (BI) and predictive analytics. BI and analytics will also help in addressing the
increased sophistication of processes and rising quantum of information.
22. Insurance in a digital world: the time is now; EY Global Insurance Digital Survey 2013
45. 45Indian insurance sector: Building Growth, Building Value |
Exhibit 5.5: Integrated business intelligence and analytics tools
Insurance company
Distribution and
Channel
Management
Actuarial
Systems and
Product Design
Underwriting
System
Enterprise Data Management Analytics Tools
Policy
Administration
System
Claims
Management
System
360° view of
customers –
Cross-sell
opportunities
Product design
and templates
BI on claims trend BI on claims customers Premium reminders/
renewals
Claims dataCustomer future needs
Customers data Policy information
Fraud
analytics
Source: EY Knowledge Analysis
Analytics platforms can provide a complete view of the customer, creating opportunities to
cross-sell and upsell23
. For example24
, when a customer adds a new vehicle to an existing auto
policy, sales representatives can use insights churned out by an analytics tool to decide whether
the customer owns a home, and whether a homeowner policy can be offered to the customer.
Similarly, the sale of a term product can trigger a cross-selling opportunity for a complementary
long-term care (LTC) rider. This big-picture view of the customer’s profile across all lines of
business, when combined with extensive information from marketing database providers, results in
personalized interaction, and improved customer retention.
Insurers can further leverage data analytics for underwriting by moving away from broader
historical rate models and integrating user-specific data to develop more accurate underwriting
models and potentially customize premiums. For example25
, in motor insurance space, several
global insurers have started using advanced tracking technology to monitor and record
unprecedented levels of information about customers’ driving habits via telematics.
Similar to telematics in cars, life insurers can now extend this model to include data gathered
from wearable technology, such as smart watches or fitness trackers. Wearable tech products
have made significant advances in detecting humans’ physical activities and biometrics, and these
capabilities are expected to continue advancing at a rapid pace26
. Life insurers can leverage the
extensive amount of health data gathered to make richer risk assessments using ongoing data for
longer-term health indicators, such as changes in body mass, blood pressure, and blood sugar and
cholesterol levels.
23. Hot Topics’ for Insurers: Social, Mobile, Analytics, Big Data, Cloud and Digital,” Novarica
24. Transforming customer service in insurance through digital innovation; EY
25. Transforming customer service in insurance through digital innovation; EY
26. Rude Health: Fitness Tech one of the internet’s fastest growing sectors, The Irish News, 27 May 2014
Many insurance
organizations run the
risk of not delivering
digital analytics soon
enough, and prefer
to wait until digital is
strongly embedded into
the overall insurance
sector. However, analytic
capabilities are already
emerging as a key
competency area for
some insurers and are
likely to provide these
insurers a competitive
advantage in a not so
distant future.