Page 41 - Insurance Times April 2022

INSURING RURAL

INDIA: PROBLEMS,

PROSPECTS AND

STRATEGIES

Introduction problems, and strategies for harnessing the potential in rural
India.
The insurance industry in India liberalized in 2000. Even after
two decades, the reach has not expanded beyond the urban
domains. If the overall market has to grow, insurance The rural opportunity
companies need to look at rural markets rather than fight In the absence of a definition of rural as per census, we solely
for the same urban market pie. Despite the vast potential rely on the inference, what is not urban, is rural. Insurance
in rural areas, the insurers believed that the rural Regulatory & Development Authority (IRDA) qualification for
opportunity is commercially unviable except for regulatory rural is a population of less than 5,000, density < 400 people
requirements. per sq km, and at least 25 percent people engaged in
agricultural pursuits. The definition brings 72 percent of the
Rural insurance is a significant challenge for public and population under the rural ambit.
private insurers due to the scattering of masses over a broad
dissection of the geographical, socio-cultural, and linguistic The rural market is vibrant and holds tremendous potential
landscape. Further, the rural folks prioritize their assets over for the growth of the insurance business, mainly because of
their own precious life. This article examines the opportunity, the strong saving habit. There are more than 6 lakh villages
with a population of 905 m (Statista, 2022). The large
population, high savings rate, much disposable income,
About the author changing rural aspirations, rising literacy levels, significant
progress in Information and communication technology, and
infrastructure point toward the largely untapped market.
Dr. Rajendra Prasad Sharma
Professor of Marketing, With 33% of public sector bank branches in rural areas, 90%
Indian Institute of Foreign Trade, of the post offices in India catering to rural areas, haats
Delhi & Kolkata (periodic markets) and melas (exhibitions), mandis (Agri-

The Insurance Times, April 2022 41