Page 26 - Insurance Times Janaury 2021

5. Way forward: Y Rising risk awareness and technology orientation:
Rising risk awareness, accelerated digital
The challenges lie in overcoming this situation and protect
the interest of all stakeholders of the general insurance transformation & new and parallel supply chains are the
sector in the days to come. Some of the probable solutions shifts that are expected to occur due to the ongoing
to improve the sector and to conquer the ongoing crisis are Covid-19 crisis. COVID-19 will encourage increased
investment in information and communication
furnished below: infrastructure. By 2030, India is expected to be among
Y Infrastructure investment to drive General Insurance
sector growth: the top 10 largest insurance markets of the world. The
global market share of India is expected to increase
Against the weak economic activities, investment in
infrastructure increases the resilience and can improve from 1.7% in 2019 to 2.3% in 2030 with premium
volume increasing from 106 billion USD (2019) to 234
productivity since it has a positive multiplier effects on
billion USD (2030) (Sigma 4/2020).
output. COVID-19 pandemic has also demonstrated the
urgent need for more investment in health Y Strong underlying fundamentals and rate hardening of
infrastructure in emerging markets and more GI sector:
investment in this area is expected. Apart from large Indian GI sector has already seen an upward
gaps in health infrastructure exposed by the present movement post-liberalization of the insurance sector
COVID-19 pandemic, main drivers of infrastructure (Figure 1). Inspite of the setback due to Covid which is
investment in the coming years shall also include equally being faced by the global GI market, the global
GI premiums are expected to grow by 1.6% on average
ongoing urbanization, digitalization of smart cities and
in 2020 and 2021. Though there would be a contraction
infrastructure. In particular, India will add 405 million
to global urban population between 2019 and 2050 of 0.1% in 2020 the GI market is expected to rebound
strongly to 3.3% in 2021. This trend is also expected to
(Sigma 3/2020) and is at present the second largest
emerging market in terms of infrastructure investment. continue for India considering the history of GI sector
growth and in line with global markets. Rate hardening
Between 2007 and 2018, India had the highest growth has helped in improvement of the sector which is also
of 7% (CAGR) in investment in infrastructure. Hence, if expected to continue in the future.
this spree continues it may lead to more investment in
Y Insurance solutions for pandemic risk:
infrastructure which in turn will lead to increase in
Insurance solutions for pandemic risk could gain traction
demand of related insurance to cover risks associated
to cover risks after COVID-19.
with such projects, both during construction and
operational phases. Further, infrastructure investments The study will help policymakers and insurers to take a
will feed back economic activities leading to higher holistic view of the impact of COVID-19 situation and plan
disposable income enabling the people to buy property/ for the future accordingly.
assets which include home, vehicles, etc. which in turn
generate the need to cover the risk of loss or damage Reference:
associated with such assets. Various Sources.

IRDAI releases norms on info for inspection of insurers

The insurance regulator has come out with new norms for insurers on minimum information they have to provide for
inspection and investigation by the Authority. As per the Insurance Regulatory and Development Authority of India
(Minimum Information Required for Investigation & Inspection) Regulations 2020, the insurers should maintain a record
of all proposals received for insurance with proposal number, date when the proposal was signed by the proposer, date
of the receipt of the proposal, name and code of the insurance agent, staff or intermediary and data and amount of
the insurance proposal deposit, among others.
For health insurance policies, additional records giving all applicable hospital records and details of claims processed by
the third party administrators should be captured. In respect of group insurance business, additional information such
as group type and size, free cover limit applied to the group and rating factors considered. For reinsurance business,
details such as unique identification number and type of reinsurance agreement, etc., have to be maintained, as per
the norms.

26 The Insurance Times, January 2021