Page 24 - Insurance Times October 2020

a change in customer behavior, data, disruptive insurance segment. And it is estimated that by the year end,
technologies, artificial intelligence and innovation. India is the health segment may be far ahead of the motor
largely an underinsured population with the insurance segment.
penetration amongst the lowest in the world. Thus the un-
explored potential in the country remains high. The current Despite good growth in premiums in August, cumulative
insurance industry is largely focused on the urban organized premiums collected in the April-August period of FY21 were
sector. mostly flat. Premiums of non-life insurers grew 3.58 per cent
to Rs 73,965 crore in that period. General insurers also saw
This segment is most vulnerable to the financial loss from flat growth with premiums at Rs 62,669.21 crore in the April-
the untimely demise of the bread-winner and has unique August period, up 0.02 per cent. This is due to a fall in motor
needs. As the Covid pandemic continues to be a major segment premiums and no hike in motor third-party
threat, physical meetings have been replaced by virtual ones premiums. The Motor insurance segment has continued to
in all genres of life. The same holds true for doctor's witness a significant decline due to a sharp drop in vehicle
consultations which are increasingly being done through sales.
virtual modes like video conferencing, video calling, online As per a recent mandate issued by the IRDAI, long-term
chatting, etc.
motor insurance packages that cover both own damages
(OD) and third-party (TP) damages, will be discontinued. The
Motor Insurance: change has come into effect from 1 August 2020 and had
The general insurance sector has managed to show a applied to those cars that have been purchased post this
positive premium growth in August, but the numbers are date. As per the older 2018 policy, it was mandatory for a
unlikely to bring any cheer to the industry. For August, the four or two-wheeler owner to have third-party insurance,
general insurance sector collected a total premium of Rs 3-years for cars and 5-years for bikes and scooters. They
13,140 crore, a growth of just 5.5 percent when compared could also buy long-term comprehensive insurance which
to same month last year. The growth in the general bundled OD and TP for a longer period. After the nation was
insurance sector between April to August 2020 also hasn't in lockdown because of Covid-19, city streets became empty
moved anywhere as it remains almost flat. From business and the number of car trips dropped dramatically. Motor
point of view, the health segment for general insurers has insurance was the worst affected with a 49% year-over-year
become the biggest line of business, overtaking the motor dip in sales to Rs. 2621 crore for the month of April, 2020.

GROSS DIRECT PREMIUM INCOME UNDERWRITTEN BY NON-LIFE INSURERS WITHIN
INDIA UPTO THE MONTH AUGUST 2020

(PROVISIONAL & UNAUDITED) IN FY 2020-21 (Rs. In Crs.)

Insurers Motor Total Motor OD Motor TP Health Grand Total Growth %
Standalone Health sub Total 0.00 0.00 0.00 6096.45 6268.76 25.85%
Previous Year Sub Total 0.00 0.00 0.00 4731.58 4981.07

% Growth 28.85% 25.85%
Specialized Insurers

AIC (Crop) 0.00 0.00 0.00 0.00 4681.16 39.04%
Previous year 0.00 0.00 0.00 0.00 3366.79
ECGC 0.00 0.00 0.00 0.00 348.29 13.11%

Previous year 0.00 0.00 0.00 0.00 400.85
Specialized sub Total 0.00 0.00 0.00 0.00 5029.45 33.49%

The Insurance Times, October 2020