Page 38 - Insurance Times March 2017 Sample

SOCIALISM was seen as Planning Distribution of wealth with and regulate Insurance Industry in India after
short falls in the creation of wealth. denationalization.
 GIC was no longer a holding company after
Globalization and Liberalization changed all these and a Denationalization. It was made the National Reinsurer
Borderless world of all Economies was seen emerging where of India as GIC Re. The Insurance Companies in India
all people of the world had all the ways open for Industrial were to make 20% Obligatory Cessions to GIC Re. GIC
and Agricultural Developments within each economy with Re also played the Role of Afro-Asian Reinsurer and
international co-operations! supported Afro-Asian Markets as a Major Reinsurer
with strength and stability.
This changed the world order.
 IRDAI opened the market for formation of Private
The Gulf war I and II impacted the new world order. Insurance Companies either with 100% paid up capital
Terrorism appeared as a threat - a negative force! of Minimum Rs. 1000 MLN by the Indian Proprietors
Insurance and Reinsurance world over had to cover or in Joint Venture with Foreign Partner with not more
Terrorism with a new threat. Terrorism became a Man- than 26% share holding. This cap is increased to 49%
made Catastrophe.
with the New Government in 2014-15.
1993 Bomb Blast in Mumbai became a big event of
By 2015-16 there are 24 Life Insurance Companies- LIC and
Terrorism! Indian Market Insurers and Reinsurers faced the
23 Private Companies with a Premium of almost USD 60
challenges of Terrorism. BLNS.

Thus by the end of the Millennium Indian Insurers and GIC And there are 19 Non-Life Insurance Companies, 5 Stand-
as Indian Reinsurer were well set to make a way of progress alone health Insurance Companies. 4 Public Sector
out of all the hurdles. Insurance Companies, ECGC and AIC as specialized Insurers.
Non-Life premiums amounted to USD 15 BLNS in 2015-16.
New Era of Economic Reforms in India under foresighted
plans of Dr. Manmohan Sigh as Finance Minister of P.M. Mr.
After the PMFBY Agricultural Insurance Premium increased
Narsimha Rao radically changed the Economy from
from Rs. 36 BLNS in 2015-16 to Rs. 150 BLNS in 2016-17
Socialistic / Communistic Idealism to Realism of Capitalism
and Rs. 200 BLNS in 2017-18.
in line with USSR. Private Sector became the engine of
Economic Growth by the end of 20th Century! Non-Life and Life Premiums are expected to be USD 90 BLNS
or more by the year 2019.
The 21stCentury began with two mega events viz. the Bhuj
Earthquake of 26th Jan 2001 for Indian Market and
Terrorism Loss in New York- The WTC Attacks by terrorists
on 11th Sep 2001. This Terrorism Loss covered all the classes
of Property, Casualty, PA, MDLOP, Aviation Hull & Liability,
Compensations to Workers clearing debris and many Life
Insurance Losses- all of which amounted to approx US$ 88
Billions! This was more than 100% of Non Life Market
Premium in UK and France. It is the largest insurance loss
since the 11th Century. 19 major western Reinsurer's
became financial week and they minimized their
involvements in Afro-Asian Markets with all kinds of
restrictions. In this scenario, Indian National Reinsurer GIC
Re emerged as a Leading Afro-Asian Reinsurer.

Restructuring Indian Insurance Industry from 1st
April, 2001
The Insurance regulator IRDAI was created and with
the Act of 1999 they were authorized to restructure

38 The Insurance Times, March 2017

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