Page 46 - Insurance Times May 2023

private sector corporates
venture out into those areas,
which necessarily holds a profit
generating surplus for them.
They, hence, will have their
footprints in those places which
will be largely composed of a
well-informed and educated
populace possessing a certain
disposable income capable to
take care of their ailments or
future uncertainties through
Insurance. On the other hand,
public sector insurance
companies, with their added
social objectives, cater often
into the growing needs of the
Mr. Shashi Bhushan addressing the participants
marginal and social Sectors in
congruence to and giving shape to various Government Plans The solution lies in the following:
and Policies. 1. A section of the price be borne by the Various
Governments
Hence, a clear dichotomy exists in the General Insurance
Market with the Public and the Private Sector Insurance 2. Keeping the end price low for the customer and
Companies having clearly distinctive objectives in their mitigating the losses (Claims - Premium) of the
outreach programmes. While the Private Enterprises are Insurance in a calculated manner. As the Governments
overtly guided by their "Profit Maximizing Objectives", The will clearly be using the machineries of the Insurance
PUBLIC SECTOR Companies are mostly expected, in this Companies as service providing resources, this will
context, to make the Social Objectives of the Governments' create sufficient impetus for running PSUs on
Outreach Programmes synonymous with those of the Commercial Priorities on one hand, also providing more
outreach programmes of the PSUs'. This certainly affects the investible funds to the INSURERS to generate multiplier
pricing system in varying degrees as Govt. Programmes are effect for any Society at large by optimally using these
based on affordable prices and mitigation of Social/Societal resources.
Losses through fortuities through BUDGETARY SUBSIDIES He added that for this targeted sector as discussed, it should
more often than not. necessarily be characterized by the following:
1. Building an environment of Trust between the
Under such a prevailing scenario, even with a PSU Insurer
Government, the Service Providers and the end
being expected to deliver with Surpluses to be invested in
beneficiaries.
the various money markets as per financial policies of the
Government, the end result largely depends on whether the 2. Considering remoteness, social strata, level of
surplus generating component of these PSU INSURERS is able education/awareness, availability of smart phones,
to outweigh the subsidy component in this process. publicity plans needs to be drafted.
Pricing Issues Further Expounded: 3. Use of Media should largely be centered around
In a country like ours, where a large section of the masses Television Channels and hoardings in strategic places,
hardly has any disposable income left for buying Insurance leaving some space for Newspapers or Mobile
after addressing their needs concerning their daily struggle Gadgetry.
for sustenance, it becomes one of the toughest challenges Most importantly however, based on his experiences in
to embark upon a price that is affordable by them and also
travelling to some of these remote places where his work
is able to generate sufficient sustainable surpluses for the had taken him, the general populace of these places clearly
PSU Insurance Companies. prefers a human interface viz an insurance agent, social

The Insurance Times May 2023 41