Page 5 - Life Insurance Today July - December 2020

Cover Story

HIGH -FREQUENCY

INDICATORS

SUGGEST INDIA'S

INSURANCE

INDUSTRY PICKING

UP PACE

T he Indian Insurance Industry is picking up pace recovery. A large part of the recovery in underwritten

premium may simply be inventory restocking, and in
again, after being stuck in limbo for the past few
anticipation of future demand disruptions. It will take some
months. April saw the hardest hit on the
Insurance Industry, with the pandemic-induced
all indicators of the business activity were in the red. The
lockdown in its most stringent phase. After a rebound in time for clearer trends to emerge. For the last four months,
May, the recovery seemed to be losing momentum. In the insurance industry stands on the precipice of profound
May-July period, the reading remained the indicators in red. change. And this disruption is not just digital. Demanding
August marked an improvement for the first time since customers, new competitors and a changing set of
May, with the number of indicators in the red dropping challenges are transforming the insurance industry.
down. The outlook still remains clouded as the pandemic
The insurance industry is set to overcome this year's COVID-
continues to spread, raising the risk of further localized
19-induced global economic recession, the latest Swiss Re
lockdowns.
Institute's sigma says. The sharpest economic contraction
since the 1930s will lead to a slump in demand for insurance
There are reasons to be guarded about the prospects of
in 2020, more so for life products, with global premiums
expected to contract by 6%, than for non-life covers (-0.1%).
About the author However, total premium volumes will return to pre-crisis
levels in 2021 already, alongside more protracted recovery
Jagendra Kumar in the global economy. There will be sector divergence, with
Ex. CEO, non-life premium volumes above pre-crisis levels, and life
Pearl Insurance Brokers below. The emerging economies, led by China, will underpin
JAIPUR the insurance market comeback.

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Life Insurance Today July - December 2020 5